In 1990, the Child Care Development Block Grant (CCDBG, part of the Child Care Development Fund) was established as part of the effort to reform welfare and serve the children of families living on low incomes. It was intended to serve a limited need, not build the comprehensive child care and early learning system that families have needed for decades. Since that time, many families have been and continue to be well-served by the program in its intended limited capacity. But it was never meant to serve everyone, and has never been resourced adequately enough even for those it was designed for; accordingly, gaping holes in coverage remain. In 2019, just 1 in 9 young children who were eligible for CCDBG actually received assistance. 

Families therefore face two policy deficits. On the one hand, the historical underfunding of CCDBG has prevented the program from serving every eligible family, while also forcing child care providers to forgo their own salaries and pay early educators poverty-level wages because of too-low reimbursement rates, despite good intentions. On the other hand, the millions of families not eligible for CCDBG to begin with have continued to struggle with out-of-reach prices for child care programs, and too few safe, nurturing, convenient options available when and where they need it, while providers and educators have had to contend with insufficient resources in the system to make early care and education a sustainable profession.

That’s why the child care and pre-kindergarten provisions that passed the House of Representatives as part of the Build Back Better Act are such transformational, game-changing policies. They will give every family—not just the wealthiest, who already have options—the freedom to make a good living and choose the care and early education for their children that works best for them. These provisions will save families about $5,000 a year in child care costs and $8,600 in pre-K costs. By investing in child care providers and businesses, the policies also address the child care staffing shortages that threaten to destroy the entire child care sector. Specifically, the policies will increase supply and improve the quality of early childhood education through higher wages and training for early educators and other child care providers. 

Recognizing that while CCDBG is vitally important, it was designed to serve a narrow purpose. Build Back Better’s child care proposal builds on what works and expands on it to do more.

Recognizing that while CCDBG is vitally important, it was designed to serve a narrow purpose. Build Back Better’s child care proposal builds on what works and expands on it to do more: to serve both low-income and middle class families, ensure high-quality child care options are available in every community, and guarantee that early educators and staff are paid higher wages.   

The proposal builds on the best parts of the CCDBG in a number of crucial ways:

  • It maintains state flexibility, allowing states to design and administer their child care systems, set subsidy payment rates, determine quality rating standards, and award quality and facilities grants to child care providers.
  • It increases parental choice by dramatically expanding access to child care subsidies for parents to use at the child care provider that meets their families’ needs—including religious child care providers and family child care providers. 
  • It helps states to implement health, safety, and licensing standards to keep children safe by providing sufficient funding to implement the critical reforms made to the child care system in the 2014 reauthorization of CCDBG. 

Build Back Better supersizes CCDBG to build a child care system that ensures all parents can choose—and afford—child care that works for them. The reconciliation language goes beyond current law in these six essential ways:

  1. It guarantees assistance to every family eligible, reaching sixteen times as many young children as under current law. In some states like Georgia, Maryland, South Carolina and Virginia, it would help state child care agencies reach at least twenty-five times as many children and their families.
  2. It lowers child care costs by about $5,000 a year by ensuring the vast majority of families don’t pay more than 7 percent of household income for child care, and by guaranteeing free child care for millions of the most under-resourced families. 
  3. It builds a child care and early learning infrastructure for young children by investing substantial resources toward supporting states to build out the supply of quality child care options, through facilities, start-up grants, and quality improvement funding. 
  4. It pays providers based on the actual cost of providing high-quality care, instead of on the market rate currently used, a metric that reflects the market failure causing child care businesses to barely meet their bottom lines. Improving provider pay further maximizes parent choice, given that under current law, many providers are disincentivized to accept subsidized families when those subsidies do not cover the actual cost of providing care. 
  5. It helps attract, retain, and train early educators and staff through investments in higher compensation and training. It also intentionally includes those who will be impacted by policy decisions in the design. For example, licensing pathways and standards must be created in consultation with child care directors, providers, staff, families, and other experts.
  6. It increases the number of high-quality early care and education options through public funding to support higher compensation and training for the workforce; through support for states in developing and using quality indicators and thresholds that are appropriate for child development in different types of child care provider settings and for different age groups; and through providing grants for providers specifically to support them in improving their quality over time and accessing increased resources on an ongoing basis. 

CCDBG will continue to serve school-age children who are not included in the Build Back Better Act’s birth-to-5 guarantee (the child care program in the reconciliation bill), and provide flexible assistance for some low-income families with young children. But the program’s block grant framework, narrow scope, and historically limited funding make it the wrong primary vehicle for solving today’s challenges. Because it is a block grant, CCDBG funding levels do not account for the actual number of families that need help paying for child care, nor can it adapt to support higher wages or changes in the cost of child care over time. Instead, states receive finite resources to help some eligible families, while the rest are left to fend for themselves. Focusing on CCDBG alone would leave the vast majority of American families dealing with the same challenges in finding and affording quality child care that they face now, and the sector will continue to struggle as well. 

Because it is a block grant, CCDBG funding levels do not account for the actual number of families that need help paying for child care, nor can it adapt to support higher wages or changes in the cost of child care over time.

In fact, when CCDBG was last reauthorized in 2014, it took four years for the funding level to increase to meet even a portion of the additional costs. Until then, it was essentially an unfunded mandate for states who had to meet new regulations, with no additional resources. Child care providers and state bureaucrats are so used to that kind of treatment that many think what is currently being considered is too good to be true. Yet the policies on the table are the result of years of efforts by parents, providers, early educators, advocates, and child development experts who have long been fighting for a system that reflects the true needs. They are only too good to be true if Congress fails to act. 

To do more than check a box—to actually solve this problem—we need the expansive policies included in the Build Back Better legislation, so that all families who need child care assistance can actually get help. The best solution is clear, and it’s time to make the child care and pre-K policies that passed the House a reality. 

The author would like to thank Daniel Hains, Melissa Boteach, and Stephanie Schmit for their contributions to this commentary.