Child care funding changes in final Ohio House budget draft

Yahoo

10-04-2025

Children in child care. (Photo by Rebecca Rivas/Missouri Independent)
The final draft of the Ohio House version of the state operating budget included some changes to their initial plans for child care, but no change to the eligibility for its Publicly Funded Child Care program.
The omnibus budget amendment, released Tuesday and passed by the House on Wednesday, added $50 million in funding for each fiscal year to support the Child Care Choice Voucher Program, using federal funding from the Temporary Assistance for Needy Families (TANF) block grant. The voucher program provides a subsidy for children whose income falls outside of the eligibility for the state's Publicly Funded Child Care.
In Gov. Mike DeWine's executive budget, he wanted the PFCC eligibility raised to a maximum of 160% of the federal poverty line. The House, however, maintained the current level of 145% in both their initial draft and the omnibus draft passed on Wednesday.
The Ohio Department of Children and Youth's director, Kara Wente, told the Senate Finance Committee the same day that the department estimates about 40,000 children live outside of the PFCC eligibility, making them eligible for the Child Care Choice Voucher Program, which has a current maximum eligibility of 200% of the federal poverty line.
With the Senate beginning work to create a budget draft of its own, Wente went on to say the child care voucher program, which was established in April of last year, has already served 5,300 families and 8,000 children.
The director said it's important for the state to support the program as child care continues to be an issue not only for parents who lack access, but also those who lack the ability to afford child care, especially at higher poverty levels.
'We know that families up to 200% (of the federal poverty line) are making less than $62,000 a year, and we know the average cost of child care in Ohio is about $11 an hour,' Wente told the committee.
Ohio's eligibility level is 'the lowest in the country,' according to Wente, who continued to support the proposed expansion of publicly funded child care to 160% in the Senate committee.
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Child care advocates have been pushing for improvements to Ohio's child care sector for years, with the Ohio Chamber of Commerce most recently holding a summit about the impacts of child care on the state's workforce.
The state chamber, along with the U.S. Chamber of Commerce Foundation and Ohio-based advocacy group Groundwork Ohio, released a full report at the summit, laying out detailed impacts on the state's economy, employment and education.
'Ohio's child care gaps drive parents out of the workforce, reduce tax revenue for the state and put undue strain on households,' the report stated.
The February 2025 research found that 'insufficient child care availability' costs Ohio $5.48 billion every year in lost economic activity.
That includes $1.52 billion lost in tax revenue due to 'child care issues' and $3.97 billion in 'child care-related employee turnover and absenteeism' costs.
The root of the issue, the report found, is low reimbursement rates for child care providers, along with low pay for those workers, and disproportionate distribution of providers, especially in rural areas.
'Ohio generally lags behind the rest of the Midwest when it comes to implementing policies to improve child care accessibility,' researchers stated in the report.
Maintaining the support for child care, particularly for children in families up to 200% of the federal poverty line is one of the top goals for Wente and the state's Department of Children and Youth.
She also told the Senate the department wants to see the application process streamlined, and payments for providers streamlined as well. Federal compliance through the use of market rates for providers and capping co-pays for parents at 7% of their income are also top priorities for the department, according to the director.
Along with the Child Care Choice Voucher Program, the House's version of the budget keeps the Early Childhood Education Grant Program proposed by the governor, 'to support and invest in Ohio's early learning and development programs,' according to budget documents. Those programs include licensed child care centers and preschools.
The budget draft also included $3.2 million for a 'child care recruitment and mentorship program,' and Publicly Funded Child Care payments would be based on a child's enrollment rather than attendance, if the provisions stay in the final draft of the budget.
Also still present in the House's budget proposal is a child care cost-sharing model that would split the costs of care three ways, between the state, employers and employees. The omnibus budget amendments capped eligibility for that program at 400% of the federal poverty level.
Wente said the department, which absorbed several other departments when it was established, is focused on meeting goals like child care access, along with lowering infant mortality rates and improving kindergarten readiness, even as the 600-person department commits to cutting 36 positions.
She wants to see the infant mortality rate in the state improve from the current ranking of 43rd in the country. Modeling the state's programs on local measures like Cradle Cincinnati, Wente said a strategy that focuses on moms, connecting moms to resources and holding the state accountable for the outcomes would go a long way to continued improvement.
'What we're seeing be common across all states (with lower infant mortality rates), no matter their makeup, is that they're actually engaging with the families that are most at risk,' Wente said.
Ohio has great 'foundational programs,' she said, but families need more assurances that they will be able to overcome burdens like poverty or a lack of transportation to get to those resources.
With changes in the department and proper budget support, Wente said they have plans to bring a rise in all outcomes for children, including in kindergarten readiness through accessible, affordable child care.
'We, today, know that based on Ohio data, that economically disadvantaged children are 2.4 times more likely to demonstrate on the kindergarten readiness assessment if they've had any involvement in preschool,' Wente said.
The House's draft of the budget removes the kindergarten readiness assessment, along with its use on the state report card, and 'related data collection and reported requirements.'
Wente was also asked about pediatric cancer funding in the state, which would see a $5 million reduction in funding as part of the House's budget draft. The executive budget called for $10 million, which the director said would be used 'to really work with our research institutions and our children's hospital to figure out the best way to add to children's cancer research.'
'Pediatric cancer research is one of the lowest-funded research components in the cancer space,' Wente said. 'It's predominantly focus on adults, so we wanted to take a targeted approach to make sure that there was focus on kids. That has been reduced to $5 million.'
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