In March 2021, Congress passed and President Biden signed into law the American Rescue Plan (ARP) Act, a $1.9 trillion COVID-19 relief package. The package includes $39 billion in dedicated child care relief funding.
The funds provided by the American Rescue Plan will help stabilize the child care sector. At the same time, we must commit to building a better system. We need a child care system that’s more accessible, equitable and affordable to families. Additionally, child care providers need a living wage and benefits. This is an opportunity to transform our child care system for all.
Learn more about the timeline and funding details of the American Rescue Plan (ARP) Act in our infographic below.
Advocacy Tips: Federal Relief Funding
The recent federal relief packages present an opportunity to transform the child care system. The child care sector was broken long before the pandemic. It is not enough to restore it to where it was before COVID-19. States now have the opportunity to make these changes happen if they use the funds to make smart investments. As an advocate, it is important that your voice is heard on how states use the funds from the ARP Act. You know what policies implemented during the pandemic helped stabilize child care and what policies can help build a better system moving forward. It is important to ensure that funds are administered in an equitable, efficient and transparent manner.
There are different ways to weigh in on how American Rescue Plan funds should be spent. Some states created formal working groups that must release recommendations (i.e., Iowa and Arkansas). Other states used surveys to gather feedback. In some states, child care and early learning groups are submitting coalition letters with recommendations. Others are meeting with state administrators or legislators.
No matter how you weigh in, it’s important to collect the information needed to make a compelling argument. Advocates will need to bring a list of policy suggestions for the state to consider supporting. One way to highlight the need for specific policies is through sharing stories collected from child care providers and families. They can use their own words to talk about the hardships they faced during the pandemic and which temporary policies helped them the most.
Relevant data on the number of operating providers, closures, workforce and demand are also helpful for these conversations. Before meeting with your state policymakers, review your state’s CRRSA 60-day report and 2022-2024 Child Care and Development (CCDF) draft/final plan (see question 4.1.8e in the plan). These can be found on your state lead agency’s website. Both plans suggest how administrators may want to use the federal funding to address short- and long-term issues.
Relief Funding for Child Care: Best Practice Checklist
Child care advocates can use this checklist to guide their conversations with state administrators. Ask your state policymakers if they will be following any of these best practices. Many of these bullets are strongly recommended by the guidance developed by the Office of Child Care (OCC) around the stabilization grant funds ($24 billion) and the supplemental CCDF Discretionary funds ($15 billion).
ARP Act and Policy Considerations for Long-term Impact
Child care advocates and stakeholders will have a chance to share which policies the relief dollars can support over the next few years. The Office of Child Care (OCC) recommends that states use the supplemental Child Care and Development Funds (CCDF) discretionary funds to implement policies that expand access to high-quality child care and foster a more equitable child care system. These OCC-supported recommendations will:
- Help stabilize and grow the current supply of child care.
- Ensure early childhood educators are better compensated.
- Allow families to have better access to affordable care in more settings.
- Reinforce that children attend programs with strong health and safety standards in place.
How States Can Support Child Care Providers
- Increase compensation and access to benefits for early childhood educators.
- Delink payment from attendance and base it, instead, on enrollment (learn more here).
- Expand the use of contracts and grants to provide services.
- Increase provider reimbursement rates to match the true cost of care. And, conduct cost of quality studies to set payment rates that cover actual operational costs.
- Provide funding that enables providers to connect with health and mental health consultants.
- Cover the costs of federally-required fingerprinting and background checks.
- Provide grants to cover startup costs.
- Support the expansion of family child care and other programs that will increase child care options for infants and toddlers, families seeking non-standard hour care, children with disabilities, families in rural communities and multi-language learners.
- Provide more trainings and technical assistance on safe and healthy child care environments.
How States Can Support Children and Families
- Reduce or cut family copayments.
- Increase the income limits for subsidy eligibility.
- Broaden the definition of qualifying activities.
- Relax child absence and eligibility redetermination periods.
- Allow essential workers to access subsidy assistance throughout the duration of the pandemic.
How States Can Support and Strengthen CCR&Rs
- Invest in Child Care Resource and Referral agencies (CCR&Rs). Their ongoing work bolsters high-quality child care by conducting outreach and providing help to families and providers — especially those who haven’t participated in the subsidy program.
- Partner with CCR&Rs to administer federal relief fund grants, including outreach and dissemination efforts.
- Upgrade data collection and technology systems.
Talking Points to Redirect Difficult Conversations about Child Care Relief Funding
Child care is a nonpartisan issue. Access to high-quality child care and early learning plays many important roles. It supports early childhood development, helps families stay at work and keeps our economy going.
Some policymakers and state administrators are ready to have conversations with you about how to use federal relief funds. But, you may hear hesitation or questions about using funds to build long-term capacity and sustainability for child care. Policymakers may express concern that these “one-time” relief funds, like in the American Rescue Plan, are challenging to sustain.
It is critical for child care advocates to meet with policymakers to discuss these concerns on a regular basis. As an advocate, it’s important to outline what child care looked like before the pandemic, how the system responded during and how things look currently. Use data and stories to paint a clear picture. During your conversations, focus on positive messaging and adapt messaging based on your audience. Tailor your message based on mindset and redirect any negative framing. Explain that investing in long-term strategies emphasizes the value of high-quality child care and helps rebuild the economy. You can find more information about messaging and understanding policymaker’s mindsets here.
How to Respond to Pushback
Below, you will find examples of common concerns. See suggestions on how to respond by toggling the dropdown box that has context for why transformative change is needed. During your conversations, focus on the widespread support for child care and ways to build bipartisan support. Avoid assigning ownership of relief funding to one political party or another.
- Pushback: "Child care funds should focus on short-term solutions. If we focus on long-term solutions, we could create a fiscal cliff."
How to respond:
- The needs of the child care community are great and have only grown through this pandemic. We cannot return to the same broken system of child care that existed before the pandemic.
- Long before COVID-19, the U.S. child care system was in trouble. Families struggled to access affordable high-quality care. Providers weren’t paid enough and faced dire financial situations due to the high cost of providing care before the pandemic even hit. The supply of licensed child care was already sparse. Faced with COVID-19, the already fragile child care system shattered.
- We’ve never received funding like this before. The newly passed federal relief marks our nation’s greatest investment in child care. We finally have significant resources to make changes that will have lasting effects for years to come. We haven’t been able to make these changes with this amount of funding before, even though it was desperately needed.
- There’s widespread support among voters. One silver lining of the pandemic is that it amplified how important child care is to ensure the success of our economy. Polls continue to show overwhelming support for child care and there is strong interest in support of all relief efforts to date.
- Child care has bipartisan support among policymakers. The great news is that there continues to be an appetite at the federal level to invest in child care in future legislative packages. Policymakers (at all levels and from all parties) realize how important child care is for child development, getting families back into the workforce and rebuilding the economy.
- Recent infusions of federal funding – including new annual, permanent increase of $633 million – have allowed states to sustain their existing child care system and make temporary improvements. However, it leaves the future of child care unpredictable for providers and families. Providing enough federal funding on a permanent basis will lead to significant long-term improvements.
- Building a system that equitably meets the needs of children, families and providers requires historic investment, and not only in 2021. We can prevent fiscal cliffs by making sufficient federal funding the norm. But to get there, we must be strategic in the policies that we put in place now.
- No child care, no recovery. The recovery of our country depends on the stabilization and growth of the child care industry. If we do not invest in child care, the long-term economic impact on businesses and our economy will be severe.
- Pushback: "I do not want to put state money behind these policies because there's already an influx of federal funds."
How to respond:
- The American Rescue Plan Act requires that subgrants be used to supplement — not replace — federal, state and local public funds. The non-supplantation requirement also applies to territorial and tribal grantees.
- We need to make smart use of our state dollars and put them behind services and programs our families value and depend on to make this work.
- Pushback: "I'm concerned with how child care providers will use the ARP relief money. Do child care programs need extra funding?"
How to respond:
- The supply of child care was decreasing even before COVID-19 resulted in the closures of thousands of child care programs. The last year has shown us why we need to provide funding for child care. That’s why each relief package to date has included child care.
- A survey of child care providers conducted in December 2020 found that only around 68% of children were attending child care compared to pre-COVID attendance. We need funding to get to providers to help keep their doors open while attendance is down.
- Many providers struggle to stay in business without increased attendance and financial support. The number of child care providers who have closed their doors permanently is alarming.
- In CCAoA’s 2021 annual survey, 15 states indicated that they were tracking the number of permanent child care closures. On average, these states reported that 3% of centers and 4% of family child care providers were closed, compared to December 2019. We expect that the number of permanent closures will increase as more states and CCR&Rs update their licensing and referral information.
- The average cost of child care is out of reach for many families. Child care costs rival college tuition. And yet, early educators are among the lowest-paid workers in the country. Early childhood education is labor-intensive and requires low child-to-educator ratios to ensure quality interactions. The remaining money doesn’t even cover adequate salaries, let alone benefits. For more information on how child care funding works, watch and share this video created by CCAoA and the Center for the Study of Child Care Employment at UC Berkeley.
- It’s time we recognize that early childhood educators are doing the difficult and important work of caring for our youngest children without a living wage. Almost half of early childhood educators rely on public services to make ends meet, and this was true even before the pandemic. They deserve fair compensation, to be treated as professionals and to be supported in their own careers.
- Pushback: "Current health and safety regulations will prevent the supply of child care from growing post-pandemic."
How to respond:
- Parents want the very best for their children. That means they need to find a safe setting they can trust to deliver high-quality child care.
- State policymakers need to maintain the health and well-being of child care providers and children.
- There is a misperception that rolling back regulations will increase the supply of quality, affordable child care. There is little evidence suggesting these regulations are the cause of the decline of providers.
- Deregulation of health and safety standards (especially after a global pandemic) would be potentially harmful to children.
- Our focus should be on supporting and investing in the child care workforce and expanding access of safe care for children.
Guidance for States on the American Rescue Plan (ARP) Act
CCAoA is committed to ensuring the funds from the ARP are used to rebuild and improve the child care system. The system needs to work better for providers, families and communities. Below are helpful links for state administrators as they distribute funds.