Times Chronicle & Public Spirit
Despite new investments by state, child care providers still facing challenges
New Pennsylvania budget provides additional funding for child care, but experts say more help is needed.
Child care has been a big topic of discussion recently.
In particular, the difficulty parents have had finding affordable slots at highquality centers. The COVID pandemic only made things worse, shutting down many facilities and depleting options.
But the pandemic didn’t cause the challenges in child care, only exacerbate them. For years child care centers have struggled to balance paying enough to be attractive to potential employees and keeping costs manageable for parents.
That has been a tough task. And the result is the average cost of child care in Pennsylvania has soared to nearly $12,000 annually, according to the Economic Policy Institute.
Those who run child care centers and parents have been asking for help. They’ve looked for their government leaders to step in and do something to help ease the financial burden.
In the recently passed state budget, Pennsylvania took some steps to address the problem.
Using a combination of federal dollars from the American Rescue Plan and state funding, the General Assembly made investments in existing programs, expanded access, bankrolled retention bonuses and created a new child care tax credit.
But those dealing with the challenges of the child care industry say that while those moves are a good start, the relief it provides is actually fairly small. They say more needs to be done to make sure that kids across the state have access to quality child care.
Investments in child care
The state provided funding for several programs and initiatives related to child care in the 2022-23 state budget. They include:
• An additional $25 million in child care services specifically to serve families through the Child Care Works Program. Families will now be eligible if they make up to 300% of the poverty line or the state median income, whichever is lower.
The state previously offered subsidies to pay part of the cost of child care for families at or below 200% of the federal poverty line. Currently that line is $55,500 for a family of four.
• $90 million in American Rescue Plan dollars that will go directly to child care centers that apply for the funds to retain and recruit workers by offering bonuses that cannot exceed $4,000 per person.
• An additional $60 million in new funding for the Pre-K Counts Program and $19 million for the Head Start Supplemental Assistance Program. Together, this $79 million expansion will allow these programs to serve an additional 2,300 children and increase rates for providers.
• An additional $22.2 million in early intervention to provide services to children with developmental delays and disabilities.
• $24.6 million for the creation of the Child and Dependent Care Enhancement Program that will allow parents and guardians to claim 30% of their child care expenses when filing their state tax returns beginning in 2023. It’s estimated that nearly 221,000 Pennsylvania families will benefit from this refundable tax credit. The program is now a permanent fixture of the state’s tax code.
Diane Barber, the executive director of the nonprofit Pennsylvania Child Care Association, said she was pleased with much of the budget. She praised the governor and General Assembly for working together to secure a number of significant investments that various child care organizations pushed to get over the finish line.
She specifically highlighted the retention bonuses for workers and the expansion of the Child Care Works Program as positive outcomes.
Barber was also happy to see the creation of the tax credit, saying that it’s a good first step.
“We can build from this,” she said. “It can be really difficult to get tax credits in Pennsylvania because of the way the constitution is written so the fact that we got this is something we can keep building on.
“Every little bit helps families.”
Steven and Kelly Goodhart, owners of the Learning Ladder Academy in Wyomissing, said the investments will help providers like them who are seeing their costs continue to rise amid growing inflation and troublesome staffing shortages.
The couple said the additional funding is welcome news, but it doesn’t go far enough.
“Child care should be free
— period,” he said. “I don’t think parents should have to pay for it. If other countries can do it then why can’t we.”
Steven Goodhart said child care centers provide children with the skills they need to socialize with their peers.
“And what they are expected to know now entering kindergarten is drastically different from years ago,” Kelly Goodhart added. “This is a great place for them to learn those skills.”
Modesto Fiume, president of Opportunity House, which operates the Second Street Learning Center in Reading, said he believes making child care more affordable for more families is always a good thing.
“Any way you can put money back into the pockets of working families is a plus,” he said. “That’s great news because when you have your child in any certified facility they’re going to get quality care. And I think that’s a win.”
But Fiume said he’s not sure how much some of the initiatives will help the families Second Street serves because about 98% are already receiving subsidized child care based on their income level.
His biggest challenge, he said, is attracting workers.
The fight for more continues
While there were many aspects of the state budget that child care advocates applauded, there was one particular request that went unfulfilled.
Advocates were calling on legislators to address the staffing shortages at centers across the commonwealth by taking $115 million of the state budget surplus to raise the hourly wage of child care workers by $2.
A statewide survey of child care providers conducted in May by the child care advocacy organization Start Strong PA found that 91% of responding facilities indicated they have a staffing shortage — resulting in a total
of nearly 7,000 open positions.
The staffing shortage is even more dire in Berks County.
According to that same survey, 95% of the 41 child care providers that responded reported they currently have a staffing shortage — resulting in a total of 270 open positions.
The child care providers reported that about 1,400 children are currently on waiting lists for slots in their classrooms and that nearly 1,220 additional children could be served if fully staffed.
Advocates argued that low wages are deterring people from applying for the open positions.
The average annual wage for child care workers, according to 2021 data from the U.S. Bureau of Labor Statistics, is $25,460. That salary equates to $12.24 an hour.
Barber said the $2 wage increase would have been a huge win for child care providers who are struggling to recruit workers and for families who are struggling to find an open slot in a classroom.
She said that while making child care more affordable is crucial, that only helps when there are enough teachers to offer that child care.
The Goodharts said they were disappointed the budget didn’t include money to supplement teacher pay, which they say would have actually helped families more than some of the other investments because parents are the ones having to make up that difference right now.
Steven Goodhart said they simply cannot compete with other employers that are offering starting wages of $17 an hour.
“We’re paying our teachers more than the statewide average, and we are still having a hard time attracting workers,” he said. “We could serve a lot more children if we could get the staff.”
“If they supplemented the teacher wages then our rates would not have to go up as high,” Kelly Goodhart added.
“Our costs are skyrocketing.”
A battle worth fighting
A pair of Berks legislators have been on the front lines of the push to make child care more accessible for all Pennsylvania families.
Sen. Judy Schwank and Rep. Manny Guzman have each made child care one of their top priorities, and both said they were happy to see additional financial support included in the new state budget. In particular, they said the new child care tax credit — which replaced a federal version that ended this year — should have a positive impact on families.
“We know that child poverty increased when the federal child tax credit went away, so I was very pleased to advocate for this particular tax credit,” said Schwank, a Ruscombmanor Township Democrat. “I think it should be helpful to people.”
Guzman likewise applauded the creation of the new tax credit.
“This is a huge thing,” said Guzman, a Reading Democrat. “It’s a significant investment. More parents in Reading, specifically, are going to be able to go to work knowing that they have affordable, quality child care.”
Guzman said one feature of the new tax credit is that it’s not temporary, meaning parents can count on it for years to come.
It’s a permanent fixture of the state’s tax code so that means two things: that the commonwealth is committed to the idea that we need to do more to keep child care affordable and, more importantly, it now gives us a vehicle to increase funding to this particular line item” he said. “Hopefully, we can increase this investment on a yearly basis as more and more folks across the commonwealth buy into the program.”
Guzman acknowledged that there is more lawmakers can do to help increase access to child care, especially proposals that would help with staffing levels like subsidizing wages.
“This was the best budget that we could pass, and no budget process is perfect,” he said. “There was obviously more that we would have loved to have seen more of, including many of the topics that child care providers have been speaking about. But, again, what I would emphasize is that this is a foot in the door.
“The marathon continues, we know that this is an issue that child care providers are continuing to face so now our job as legislators is to take action.”