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Reauthorization of the Child Care & Development Block Grant

The Child Care & Development Block Grant (CCBDG) is the primary federal funding stream for child care in the United States. The CCDBG program was created in 1990 and was reauthorized and expanded in 1996, as part of welfare reform. Along with the Temporary Assistance for Needy Families (TANF) program, CCDBG was initially up for reauthorization in 2002. Since that time, legislation to reauthorize CCDBG has not yet been approved by Congress and funding for CCDBG has been maintained through a series of funding extensions. This session, Congress is attempting once again to reauthorize CCDBG.

CCDBG is administered by the Department of Health and Human Services and provides formula block grants to states. States primarily use the grants to subsidize child care for low income working families, for TANF recipients, and families transitioning from welfare to work. In addition, no less than 4 percent of the CCDBG funding is required to be spent on activities to improve the overall quality of child care.

CCBDG is funded through federal "discretionary" and "mandatory" funding, as well as state "maintenance-of-effort" and "matching requirements" . Since 2002, federal CCDBG funding has essentially remained frozen. As a result, many states have lowered income eligibility cut-offs, increased parent co-payments, reimbursed providers at lower than market rates, and placed children on waiting lists. As part of the budget reconciliation bill (officially referred to as the "Deficit Reduction Act of 2005"), Congress approved an increase in CCDBG funding of $200 million a year for the next five years. However, the nonpartisan Congressional Budget Office (CBO) that analyzes all spending pending before Congress estimated that this modest increase would be billions below what would be required to adjust current assistance for inflation let alone meet the work requirements under TANF.

Click here for NACCRRA's Recommendations to Congress for CCDBG reauthorization.