This month the National Women’s Law Center released a state-by-state report, Downward Slide: State Child Care Assistance Policies 2012. This annual report examines the impact of five critical factors that determine the affordability, accessibility, and quality of assistance in each state: income eligibility, waiting lists for assistance, copayments required of parents receiving assistance, reimbursement rates for child care providers, and eligibility for parents searching for a job. The report, which examines the impact of policies in all 50 states and the District of Columbia, compares data for February 2012 to data for February 2011 and 2001.
Maine’s child care assistance program has certainly experienced a downward slide. State budget cuts implemented in the second session of Maine’s 125th Legislature have resulted in a loss of $3.5 million dollars of state and federal resources for child care assistance.
Where Does Maine Stand?
Policies that recognize the economic challenges for working Maine families have remained intact. As of April 2012, the income eligibility limit was increased to 250 percent of poverty to adjust for the 2012 federal poverty level.
If a parent receiving child care assistance loses his/her job, the family can continue in the program at 20 hours a week while searching for a job for up to 8 weeks within a 6-month period. This particular policy is important because typically, parents receiving child care assistance are employed in jobs with high turnover rates.
Maine had previously been serving eligible families who applied without placing them on waiting lists. In March 2012, a wait list was started and had 568 children on it as of July 2012. By August 2012, 757 eligible families were on the wait list.
All parents receiving child care assistance are required to pay a portion of the total child care fee, based on a sliding scale. Parents in Maine pay 10% of their gross income. The national average is 6% of gross income.
Reimbursement rates for child care providers were reduced from the 75th percentile to the 50th percentile of the market rate in the first session of Maine’s 125th Legislature. This reduction has caused some small business child care providers to no longer accept child care vouchers and instead only accept private-pay clients. Enrolling a private-pay family means the provider receives the full payment for the care they provide instead of a reduced rate. Only accepting private-pay clients is much less time intensive than managing the billing and payment process from the State.
Maine has continued to provide a quality stipend for providers at Step 4 in Quality for ME, the state’s quality rating and improvement system. Providers at Step 2 and Step 3 receive the bonus for one year after achieving that quality level; providers at Step 4 receive the bonus on an ongoing basis.
Why is This Important?
Research shows that housing and stable, adequate income have an influence on a child’s school readiness. When families are provided with the support to ensure children’s basic needs the risks of negative child development outcomes are decreased. Child care subsidies are one element of ensuring income stability for working parents in low-wage jobs.
 Duncan, G. & Magnuson, K. “The Long Reach of Early Childhood Poverty,” Pathways, Winter 2011, Stanford Center for the Study of Poverty and Inequality, Stanford University, CA.