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Friday, October 5, 2012

The Child Care and Development Block Grant: Background and Funding

Karen E. Lynch
Specialist in Social Policy

The Child Care and Development Block Grant (CCDBG) provides subsidies to assist low-income families in obtaining child care so that parents can work or participate in education or training activities. Discretionary funding for this program is authorized by the Child Care and Development Block Grant Act of 1990 (as amended), which is currently due for reauthorization. Mandatory funding for child care subsidies authorized in Section 418 of the Social Security Act (sometimes referred to as the “Child Care Entitlement to States”) is also due for reauthorization. In combination, these two funding streams are commonly referred to as the Child Care and Development Fund (CCDF). The CCDF is the primary source of federal funding dedicated solely to child care subsidies for low-income working and welfare families.

The CCDF is administered by the Office of Child Care at the U.S. Department of Health and Human Services (HHS), and provides block grants to states, according to a formula, which are used to subsidize the child care expenses of working families with children under age 13. In addition to providing funding for child care services, funds are also used for activities intended to improve the overall quality and supply of child care for families in general.

Discretionary child care funds are subject to the annual appropriations process. Full-year appropriations for FY2013 have yet to be enacted. However, both the House and the Senate have passed a six-month government-wide continuing resolution (CR) for FY2013 (H.J.Res. 117). The bill, which has been presented to the President for his signature, would generally maintain funding for discretionary programs at their FY2012 levels, increased by 0.612%. (In FY2012, the discretionary CCDBG was funded at $2.278 billion, per P.L. 112-74.) Prior to passing the CR, both chambers had initiated action on FY2013 appropriations for the Departments of Labor, Health and Human Services, Education, and Related Agencies (L-HHS-ED). Both the Senate Appropriations Committee-reported bill (S. 3295, S.Rept. 112-176) and the draft bill approved by the House Appropriations L-HHS-ED Subcommittee called for increases in discretionary CCDBG funding for FY2013. The Senate committee-reported bill would appropriate $2.438 billion (+7% from FY2012) in discretionary CCDBG funds for FY2013, while the House subcommittee-approved bill would provide $2.303 billion (+1% from FY2012).

Mandatory child care funds are not typically included in annual appropriation bills. Mandatory funds were directly appropriated (or pre-appropriated) for fiscal years 1997 through 2002 by the 1996 welfare reform law (P.L. 104-193), which enacted the mandatory component of the CCDF. Temporary extensions provided mandatory CCDF funding into FY2006. On February 8, 2006, a budget reconciliation bill was enacted into law (P.L. 109-171), increasing mandatory child care funding by $1 billion over five years (for a total of $2.917 billion for each of FY2006-FY2010). The authorization and pre-appropriations for mandatory child care funding were set to expire at the end of FY2010, but a series of six short-term extensions maintained mandatory child care funding at the same level ($2.917 billion) for FY2011 and FY2012. The most recent of these extensions (included in P.L. 112-96) was scheduled to expire on September 30, 2012. However, the FY2013 CR (H.J.Res. 117), includes a special provision to extend mandatory child care funding through March 27, 2013.

Date of Report: September 27, 2012
Number of Pages: 40
Order Number: RL30785
Price: $29.95

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