Consensus building for bigger child care tax credit
(The Center Square) – Consensus continues building in the General Assembly as lawmakers embrace expansion of the state’s child care tax credit.
What exactly an expansion looks like remains to be seen, though Gov. Josh Shapiro, Senate Republicans and House Democrats – who play key roles in negotiating the state’s budget – agree more must be done.
“We have reached the point where this is no longer an issue for families, but an issue for employers across the commonwealth,” Nicole Reigelman, spokeswoman for House Democrats, told The Center Square on Monday.
According to the Economic Policy Institute,
care for one child in Pennsylvania nears $12,000 per year – a cost so prohibitive that nearly 1.6 million parents have left the workforce entirely. During his budget address last week, Shapiro said the state’s economy loses $3.5 billion each year because of lacking child care options.
“We can’t ignore the fact that it’s hard for moms and dads to get to work in the first place if they don’t have affordable child care,” he said.
Shapiro proposed boosting the Child Care Works program by $66.7 million to offer more support for low-income families, as well as raising salaries for child care workers to fill more than 4,000 positions and clear a waitlist of more than 38,000 kids.
This would come in addition to the state’s $25 million child care tax credit that became law last year as part of a $45.2 billion spending plan.
“House Democrats had fought for a more robust investment that was ultimately rejected by Republicans,” Reigleman said. “It is promising to hear that child care affordability is a shared area of interest between the House and Senate chambers.”
Modeled after the federal program, families earning less than $43,000 annually receive a $315 credit for one child and $630 for two or more. The amounts reduce to $180 and $360 for filers making more than $43,000.
Roughly 220,000 families will qualify for the credit this year, according to state data.
“We are really pleased that the governor is building on some of the things we have started previously with the child care tax credit and child care in general,” said Senate President Pro Tempore Kim Ward, R-Greensburg. “That is very important to families. Again, we just have to find a way to fund all of this.”
Kate Flessner, spokeswoman for Senate Republicans, told The Center Square on Monday the chamber’s upcoming appropriations hearings will more closely examine Shapiro’s proposals, including child care investment. The end goal, she said, is to “determine the best way forward to strengthen Pennsylvania communities in the most efficient way possible.”
“The Senate Republican Caucus is committed to fostering opportunities for all Pennsylvanians and creating an environment in which families are empowered to stay here and grow here,” she said.
Despite lingering questions about the cost, lawmakers have already begun crafting legislation to offer more financial support.
Reps. Melissa Shusterman, D-Paoli, and Tina Davis, D-Levittown, propose expanding the credit for families that spend more than 10% of their taxable income on child care each year.
The amount would be capped at 20% or $5,000 – whichever is lower.
“A parent should never have to choose between taking care of their child and going to work,” Shusterman said. “This legislation will help more Pennsylvanians afford child care and in turn, allow them the freedom to work and better provide for their families.”
Reigelman did not comment specifically on the proposal, deferring to upcoming negotiations.
“House Democrats are hopeful that the parties will find agreement to expand the program this year to provide meaningful support to working families,” she said.