OKPOLICY.ORG
An issue that will likely be on the legislative agenda next year is childcare. In years past, one parent either by choice or necessity – usually the mother – stayed out of the paid workforce to care for children at home. But as the economics and the makeup of families have changed, with both parents working and more single-parent families, the need for out-of-home childcare has exploded.
The challenge is the business of childcare has not found a model that profitably meets the need. Given the value society attaches to our children, government stepped in to regulate the industry requiring certain levels of training and education, ratios of caretakers to children, and safe and healthy physical facilities. Because the regulations and other costs of doing business priced childcare out of reach for many parents, the state and federal governments began subsidizing the cost for lower-income parents.
Lack of access to quality childcare was already a huge problem, but the pandemic stressed the industry even more causing loss of many childcare facilities. Responding to the financial crisis in families caused by the pandemic, Congress increased the subsidies through the American Rescue Plan Act (ARPA) allowing Oklahoma to reduce parents’ co-pays to zero. In 2023, co-pays were increased to 50 percent of the normal co-pay to prepare for ending the pandemic funding.
In addition to parent subsidies, through its Child Care Stabilization program, ARPA provided funding for the states to provide grants to childcare facilities that helped with basic operational costs like wages and benefits, rent and utilities, and program materials and supplies.
With the increased federal funding through ARPA ending, DHS proposed a rule to return parent co-pays to 100 percent effective Oct. 1. Also, to stretch dollars, new rules were proposed that would reduce the number of people who would be eligible to receive subsidies. The limit on income would change from 85 percent of the state’s median income level to 70 percent.
The new state Department of Human Services rules would also have affected the “star ratings” of childcare centers which determine the amount of the subsidy for each facility. The star ratings act as an incentive for childcare facilities to provide higher quality care. A center with a five-star rating is eligible to receive more funding per subsidized child than a lower-rated center. The new rules would have implemented more requirements and increased inspections, which would have had the effect of lowering the overall subsidies.
However, after receiving considerable pushback, DHS announced last week that it would withdraw the proposed rule changes to give childcare providers and parents more time to offer input. But the truth is the state will likely have to increase its funding, now considered critical to sustaining childcare in Oklahoma, or face the loss of access to childcare for many working parents.
Rep. Suzanne Schreiber, D-Tulsa, who has been working on the issue for two years since she entered the legislature, says childcare is a problem that needs attention.
In an opinion piece in The Oklahoman, Schreiber says:
“For a long time, childcare has been treated like something that would ‘just happen,’ something that families would ‘figure out.’ Multiple economic studies have calculated that Oklahoma loses over $1 billion in our state’s economy to childcare challenges. That figure says plain as day that childcare is a critical part of the economy ― that childcare is workforce infrastructure. Knowing that, our role as a state in partnering with parents and childcares to deliver for our economy is what seems to need some figuring out.”
The ending of ARPA funding will likely force the childcare issue onto the agenda.
