Budget Summary: Child Care and Development Fund
Alice Fitzgerald | February 12, 2024
The Child Care and Development Fund (CCDF) provides federal funding to states, territories, and tribes to help low-income parents get to work or pursue education and training so they can better support their families. The CCDF also promotes the learning and development of young children by providing funding to enhance child care quality.
The U.S. Department of Health and Human Services (HHS) administers the federal Child Care and Development Fund block grant, which provides funding for child care subsidies and invests in child care quality. Authorized through the Child Care and Development Block Grant (CCDBG) Act, the purposes of the CCDF are to:
- Allow states flexibility in developing their child care programs and policies;
- Empower working parents to choose the care that best suits their family’s needs;
- Encourage states to provide consumer education to parents and promote family involvement;
- Help states deliver high-quality, coordinated early childhood care and education services that maximize parents’ options and support them as they achieve financial self-sufficiency;
- Assist states in improving the overall quality of care by implementing health, safety, licensing, training, and oversight standards;
- Improve child care and the development of participating children; and
- Increase the number and percentage of low-income children in high-quality care.
Funding
The federal CCDF grant is divided into three categories of funding: mandatory, matching, and discretionary.
Mandatory Funds
- These are 100% federal funds allocated to each state based on the federal share of its funding for child care programs linked to the now repealed Aid to Families with Dependent Children (AFDC) (such as AFDC, JOBS Child Care, Transitional Child Care, and At-Risk Child Care).
- The allocation is based on federal funds received in FY 1994, FY 1995, or an average of funds received in FY 1992–FY 1994, whichever is greater.
Matching Funds
- These funds are allocated to states based on the state’s number of children younger than age 13, compared with the national total of children younger than age 13.
- State, local, or donated funds can be used to satisfy the match requirement.
- To receive these funds, a state must:
- Provide matching funds at the current Medicaid match rate;
- Obligate the federal and state share of matching funds in the year in which the matching funds are awarded;
- Obligate all of its mandatory funds in the fiscal year in which the mandatory funds are awarded; and
- Obligate and expend its maintenance of effort (MOE) funds in the year in which the matching funds are awarded.
Discretionary Funds
- These are 100% federal funds allocated to states using a proportional formula based on three factors:
- The young child factor: the state’s share of children younger than age 5;
- The school lunch factor: the state’s share of children receiving free or reduced-price lunch; and
- The allotment proportion factor: the state’s per capita income (averaged over three years).
- To access these funds, a state must also meet the maintenance of effort (MOE) and use at least 70 percent of the total amount for Temporary Assistance for Needy Families (TANF) for those eligible for TANF assistance.
In addition to State General Fund dollars, Kansas contributes about $5 million annually from the Children’s Initiatives Fund (CIF) to make up the state matching portion, together with a state contribution (MOE) of $6.7 million.
Between FY 2016 and FY 2023, Kansas had underinvested matching state dollars to the CCDF, resulting in federal matching funds left on the table. Prior to the COVID-19 pandemic, state funds to fully match available federal funds were short by more than $12 million.
If Kansas had invested the full amount, the state would have received a total $15 million federal match. The combined $27 million investment could have better positioned the state to handle the child care crisis families and providers are currently facing.
| Allocation | FY 2023 GBR | FY 2024 GBR |
| Allocation | FY 2023 | FY 2024 |
The FY 2024 Governor’s Budget Recommendation included increased state funding to maximize the federal match, which was approved by the 2023 Legislature in the state budget bill.
Eligibility in Kansas
To be eligible for child care assistance, families must be below 185 percent of the federal poverty level (FPL). Families making more than 70 percent of FPL must pay a copay, employed families must work a minimum of 20 hours per week, and families must cooperate with Child Support Services.
Persons eligible for child care assistance include:
- Families participating in TANF or Supplemental Nutrition Assistance Program (SNAP) work programs;
- Low-income employed families;
- Families in approved education or training activities;
- Teen parents completing high school or obtaining a GED; or
- Children receiving Prevention and Protection Services.
Qualifying families receive their subsidies through the Department for Children and Families (DCF) on an Electronic Benefit Transfer (EBT) Kansas benefits card, with funds available on the first day of every month. They can use those funds to pay the enrolled child care provider of their choice, with certain eligibility criteria.
Parents choose their child care provider from the following types:
- Licensed child care center
- Licensed family child care home
- Licensed group child care home
- Out-of-home relative provider
- In-home relative provider
Conclusion
Ample research has shown that when child care assistance is available, parents are more reliable workers, productivity increases, turnover costs decrease, and working families are able to spend more money on necessities. A stronger workforce ultimately boosts the state’s economy.
Effective strategies to maximize federal funds include continued full matching dollars from the State General Fund and additional state investment. Kansas’ child care assistance program increases the availability and quality of child care services, assists parents trying to achieve independence from public assistance, and improves child care and development of participating children.
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