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Kentucky Legislature Expanding Access to Childcare

Kentucky Legislature Aims to Expand Access to Childcare

Amid the rising cost of childcare and the closure of many childcare businesses during the Covid-19 pandemic, the Kentucky Legislature is working to expand access to childcare throughout the state. Last September, federal funding for childcare centers provided through the American Rescue Plan Act in 2021 expired, leaving many area childcare businesses in dire straits financially. Governor Andy Beshear stepped in last fall to commit $50 million to help childcare centers in Kentucky stay open.

However, those funds provided by the Governor are expected to quickly dry up, and the Kentucky Legislature is taking action to expand the state’s commitment to opening more childcare centers and making childcare more affordable. A 2022 report from the Kentucky Chamber of Commerce estimates that 45,000 Kentuckians either lack access to childcare or early education or struggle to afford it. In response, the Kentucky Legislature has enacted and is considering several proposed bills to address the problem.

Last year, the Employee Childcare Assistance Partnership Program (ECCAP) was established to allow participating employers’ contributions to employee childcare matched up to 100% by the state. By offering taxpayer funds to supplement childcare contributions from employers, the Kentucky Legislature aims to make childcare more affordable and keep childcare centers in business.

To help keep those childcare centers staffed and operational, the Childcare Assistance Program (CCAP) was also enacted. CCAP uses state funds to subsidize childcare for childcare center employees working 20 hours or more per week, regardless of income. Because childcare is among lowest paying job sectors, this subsidy is enormously helpful to parents who are also employees at childcare centers. By October 2023, approximately 3,200 parents and 5,600 children were covered under the program.

Looking to the future, Sen. Cassie Chambers Armstrong has already filed a bill proposing a child tax credit for low-income families with children under the age of six. If enacted, Senate Bill 12 would qualify single taxpayers with an income under $50,000 and married taxpayers with an income under $100,000 for a $1,000 tax credit per qualifying child. Sen. Armstrong has also proposed bills to eliminate sales tax on diapers and expand access to free meals.

Later in this year’s session, the Legislature will consider Governor Andy Beshear’s ambitious Forward, Together budget proposal, which earmarks $172 million to fund universal preschool for Kentucky children. In his recent address to the Commonwealth, Governor Beshear stated that this commitment will “take the burden of paying for an extra year of childcare off the backs of working parents” and provide preschool education to an additional 34,000 Kentucky children.

Additionally, Governor Beshear proposed expanding the Childcare Assistance Program by allocating an additional $15 million in 2025 and $20 million in 2026 to the program. Beshear explained that through this expanded funding, there will be “more slots” available for providers to care for children from birth to 3 years old. “These investments show our commitment to helping relieve the worries that parents face when it comes to their children getting quality care and the best education,” Beshear said. The Kentucky Legislature will consider Governor Beshear’s budget proposal later in this year’s session.

Our attorneys at SLG have extensive experience assisting Type 1 and Type 2 Childcare Centers and Family Childcare Homes with various regulatory matters. Contact us today if you have any questions or are interested in seeking representation.