Education

New Tax-Credit Bill Adds to Child-Care Muddle

By Deborah L. Cohen — August 02, 1989 4 min read

Washington--A conflict between two House panels has placed a new obstacle in the path of child-care legislation in the 101st Congress.

Meanwhile, the political stakes involved in the child-care debate were underscored last week by new figures from the Census Bureau on the high cost of child care for working women.

The agency reported that families with working mothers spent $14 billion on care for children under age 15 in 1986, with women below the poverty line paying, on average, 22 percent of monthly income on child care.

Jockeying on Tax Provisions

Until recently, the primary vehicles for child-care legislation were the “act for better child-care services,” passed by the Senate June 23, and the “early-childhood education and development act,” adopted by the House Education and Labor Committee June 26.

The so-called “a.b.c.” bill, S 5, would authorize $1.75 billion to provide child-care subsidies to low- and moderate-income parents, and improve the supply, training, and quality of providers.

A tax component added on the4Senate floor also would make the current dependent-care tax credit refundable, so families with no tax liability could receive a direct payment from the government.

It would also add a “young-child supplement” to the earned-income tax credit and offer a health-insurance tax credit to defray the cost of premiums for low-income families.

Asserting its jurisdiction over the child-care issue because of interest in a tax component, however, the House Ways and Means Committee July 19 adopted a package of tax credits and state block-grant funds for child care as part of a budget-reconciliation measure.

The proposal, crafted by Thomas J. Downey of New York, acting chairman of the Subcommittee on Human Resources, and George Miller of California, chairman of the Select Committee on Children, Youth, and Families, would increase the amount of the earned-income tax credit and adjust it for family size. It also would offer a supplemental “young-child’’ credit for families with a child under the age of 6.

The Ways and Means measure also would expand the Title XX social-services block grant by lifting its $2.7-billion funding cap by about $400 million a year and requiring states to earmark 80 percent of the increase for child care.

‘Jurisdictional Battle’

Another bill, HR 3, the $1.78-billion child-care bill crafted by Representative Augustus F. Hawkins of California, chairman of the House Education and Labor Commitee, would expand Head Start, fund before- and after-school child-care programs based in schools, and provide funds for child-care programs in a variety of settings for children under age 3.

To prevent HR 3 from getting derailed by the Ways and Means measure, the House Education and Labor Committee last week agreed by a 20-12 vote to add it, too, to the budget-reconciliation bill.

“If that’s going to be the track for child-care legislation, we want our legislation in the track,” a committee aide explained.

“There’s a real jurisdictional battle going on here,” but it also concerns substantive questions about “the best way to distribute child care to infants and toddlers,” the aide said. “When it comes down to it, the House leadership is going to have to decide.”

Helen Blank, director of the Chilel10ldren’s Defense Fund’s child-care division, said adding HR 3 to the budget measure was important to keep the tax-credit and Title XX expansion “from becoming the major child-care vehicle.”

While such approaches can be valuable “supplements,” she said, “what American families are asking for is a comprehensive child-care bill, and that’s what a.b.c. and HR 3 are.”

Backers of those bills hope House leaders will “retain the reported version of HR 3 in conjunction with a tax provision,” said an aide to Dale E. Kildee, Democrat of Michigan and a chief a.b.c. sponsor.

Aides to President Bush, however, have said they would recommend that he veto a child-care bill along the lines of a.b.c., said Deputy Press Secretary Steve Hart.

The child-care proposal unveiled by Mr. Bush in March and favored by many Republicans would provide child-care aid mainly in the form of tax credits, offering greater “choice and flexibility to parents,” Mr. Hart said. (See Education Week, March 22, 1989.)

While the President has not commented on the Ways and Means proposal to expand Title XX, added Mr. Hart, “we don’t feel that’s the appro4priate track to take.” Even if House leaders resolve the dispute between the two panels before the Congress’s August recess, budget-reconciliation legislation is unlikely to reach the floor until September.

The conflict is the latest wrinkle in a child-care debate that has been beset by controversies, including the question of whether the federal government should underwrite religious child care.

Education groups, including the National Education Association and the American Federation of Teachers, strongly oppose a Senate amendment to the a.b.c. bill, backed by the U.S. Catholic Conference, that would permit the use of federal aid for religious instruction in child care.

The House education panel added an amendment to HR 3 that expressly bars such expenditures. However, Mr. Kildee reserved the right to offer a floor amendment similar to the one adopted by the Senate.

Resolving a dispute over child-care standards, meanwhile, the Senate modified a provision setting mandatory quality and safety standards and substituted model standards with an incentive-grant program to help states meet them within a specified time period.

(See Education Week, May 24, 1989.)

HR 3 and the Ways and Means measure include similar provisions.

A version of this article appeared in the August 02, 1989 edition of Education Week as New Tax-Credit Bill Adds to Child-Care Muddle

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