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1 1 (July 18, 2019)

handle is hein.crs/govbamg0001 and id is 1 raw text is: ~~ Inforingi the eiltv eaesne11 Updated July 18, 2019 Child Care Entitlement to States Overview The Child Care Entitlement to States (CCES) was created by the 1996 welfare reform law (P.L. 104-193). This law authorized the CCES in Section 418 of the Social Security Act, which directly appropriates annual mandatory child care funding for states and tribes. The law calls for CCES funds to be integrated, at the state level, with discretionary allotments from the Child Care and Development Block Grant (CCDBG). The law also requires CCES funds to be spent under CCDBG Act rules. In combination, the CCES and CCDBG are commonly called the Child Care and Development Fund (CCDF). The CCDF is administered by the U.S. Department of Health and Human Services (HHS). Legislative Evolution The current structure of federal child care funding streams is linked to the system that existed prior to 1996, when the welfare reform law simultaneously repealed, created, and consolidated federal child care programs. Before this, four separate federal programs supported child care for low- income families. Each program had its own eligibility criteria and program rules. Three of these programs were linked to the old welfare system, Aid to Families with Dependent Children (AFDC), while one (CCDBG) targeted low-income working families not connected to AFDC (see Figure 1). Jurisdiction for the four child care programs was split across multiple congressional committees. The 1996 law repealed the three welfare-related funding streams, created a new mandatory child care funding stream (CCES), and amended the CCDBG Act. In an effort to streamline and simplify administration of these funding streams, the law generally applied CCDBG Act rules to CCES funds. Since enactment, the Senate Finance and House Ways and Means (W&M) committees have generally exercised jurisdiction over the CCES, while the Senate Health, Education, Labor, and Pensions (HELP) and House Education and Labor (E&L) committees have generally exercised jurisdiction over the CCDBG. Authorization Status The 1996 law authorized and appropriated CCES funding for each of FY1997-FY2002. Temporary extensions provided funding into FY2006, when the Deficit Reduction Act of 2005 (P.L. 109-171) reauthorized the CCES and appropriated $2.917 billion annually through FY2010. Since then, the CCES has been funded at the same level ($2.917 billion) by a series of short- and medium-term extensions. The current extension (provided by H.R. 2940) is scheduled to expire on September 30, 2019. Several bills in the 116th Congress would appropriate CCES funding at an increased level for FY2020 and beyond. For example, H.R. 3298 would provide $3.917 billion for each of FY2020-FY2021, while H.R. 1753 and S. 802 would provide $3.525 billion for each of FY2020-FY2024. The CCDBG Act-which establishes most of the program rules by which CCES funds are administered at the state level-was reauthorized through FY2020 by P.L. 113-186. Figure I. Legislative Evolution of the CCDF BEFORE PL 104 193 4 Programs 1 AFDC Child Care Familles rfeeiving welfare 2. Transitional Child Care Families leaving AFDC (12 months) 3. At-Risk Chad Care Iamilies at-risk of AF X eligibility Mandatory Funding A' wa't, finance 4. CCDBG L ow income working families at or below 75% SMI fttoyv~ Dc -t ;,fvI un in AFTER PL. 104 193 1 Program Child Care and Development Fund S1 set of program rules * 1 target population (850 SMI) * 1 state lead agency * 2 funding authorizations SSA = Social Security Act; SMI = State Median Income, Source: Prepared by the Congressional Research Service (CRS). Allocation Formula The law requires HHS to reserve between 1% and 2% of CCES funds for tribes and tribal organizations. In addition, FY2019 CCDBG appropriations provisions allow HHS to reserve up to 0.5% for technical assistance and 0.5% for research. Remaining CCES funds are allocated in two parts. * First, each state receives a fixed amount each year, equal to the federal funds the state received for welfare-related child care programs in the mid-1990s. This amount totals $1.2 billion annually and is sometimes called guaranteed mandatory funding, as there are no state maintenance-of-effort (MOE) or matching requirements. * Second, remaining CCES funds ($1.7 billion annually) are allotted to states based on their share of children under age 13. To receive these funds, states must meet a MOE requirement set at 100% of the amount states spent on welfare-related child care programs in the mid- 1990s (totaling $888 million annually). States must also match the federal funds with state dollars (totaling about $1.3 billion annually) at the Medicaid matching rate. https://crsreports.congress.go,

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