Child care subsidies help parents pay for child care to enable parents to work or attend education and training activities. This ASPE issue brief provides an overview of the numbers and characteristics of children who were eligible for and who received child care subsidies in fiscal year 2011. The main findings are as follows:
- Of the 14.3 million children eligible for child care subsidies under federal rules, 17 percent received subsidies.
- Of the 8.4 million children eligible for child care subsidies under state rules, 29 percent received subsidies.
- Poorer children were more likely to receive subsidies than less poor children.
In fiscal year 2011, federal and state spending totaled roughly $11.3 billion to support child care services to improve the affordability and availability of child care for low-income working families. Funding for child care subsidies was from the Child Care and Development Fund (CCDF) and related government funding streams.1 Typically, CCDF funds are used to subsidize child care services through vouchers, although some states also provide services through grants or contracts. In 2011, over $1 billion was also spent on activities to improve the quality of child care.
Approximately 17 percent of federally-eligible children received subsidized care through CCDF or related government funding streams in an average month in fiscal year 2011 (see Table 1). In this brief, we define federally-eligible children to include all children who are potentially eligible to receive subsidized care based on the federal eligibility parameters of CCDF. Federal statute permits states to provide child care subsidies to qualifying families with incomes below 85 percent of state median income.
Within federal eligibility parameters, states have flexibility in setting more restrictive rules for income eligibility. This issue brief also explores estimates of child care assistance eligibility and receipt based on state-defined eligibility rules, as well as the age and poverty status of eligible children and those who receive assistance.
Table 1: Number of Children Potentially Eligible and Percentage of Eligible Children Receiving Child Care Subsidies, Average Monthly, 2011
|Children Potentially Eligible for CCDF Under Federal Parameters||Children Receiving Subsidies||Percentage of Potentially Eligible Children Receiving Subsidies|
1 The estimated $11.3 billion spent through CCDF and related government funding streams in fiscal year 2011 includes estimated expenditures on direct child care services of $7.6 billion in federal CCDF funds (including the Child Care and Development Block Grant and supplemental funds appropriated through the American Recovery and Reinvestment Act , the Child Care Entitlement to States, state matching and maintenance of effort (MOE) funds for CCDF, and transfers from the Temporary Assistance for Needy Families Block Grant (TANF) to CCDF). Additional expenditures include $1.4 billion in TANF funding spent directly on child care services, $1.9 billion in “excess TANF MOE” (state child care expenditures claimed as TANF MOE to the extent such amounts are above the amounts already claimed as CCDF MOE), and $0.4 billion in Social Services Block Grant expenditures related to child care.