BBB Specifics: Child Nutrition and Child Tax Credit

Nov 04, 2021

By Jackie Semmens

Last week, President Biden and Congress unveiled the latest version of the federal recovery package, coined the Build Back Better plan. This package represents a significant investment in Montana communities, geared toward expanding economic opportunity and lowering costs for families and workers. Historic investments in child care, preschool, school nutrition, and the child tax credit will help lift millions of children from poverty. Over the next week, Montana Budget & Policy Center will provide information on key components of this package. We’ll start with child nutrition and the child tax credit.

The economic relief package before Congress is a historic step in relieving childhood hunger and poverty. Even prior to the pandemic, too many families struggled to make ends meet. But the pandemic has amplified the challenges many families face. One in ten adults living with children report that the children in their household aren’t getting enough food to eat this fall.

Child Nutrition Provisions
The federal package takes vital steps in addressing childhood hunger by addressing the summer meal crisis.

• Authorizes Summer Electronic Benefits Transfer (EBT). When schools are closed in the summer, many children who rely on the school for free or reduced-price meals are left with nutritional gaps. For the summers of 2023 and 2024, eligible families would receive $65 per child per month. States and Indian Tribal Organizations will also receive grants to build capacity to implement S-EBT. This program helped reduce hunger during the summers of 2020 and 2021 as Pandemic-EBT and will be available to states in 2022.
• Expand Community Eligibility Provision (CEP). Many children live in areas with high poverty rates and miss out on free and reduced-price meals due to difficulty accessing the program. CEP allows all students to receive free meals at school if there is a substantial number of qualifying students. The new guidelines would lower the Identified Student Percentage from 40 percent to 25 percent, include a statewide CEP option, and increase the federal reimbursement rate.
• Provide increase funding for healthy school meals. The plan would also provide $250 million to Healthy Food Incentives Demonstration projects to improve the quality of food served and allow for fresh, local, regional, and culturally appropriate food, and $30 million in school kitchen equipment grants.

These steps to improve childhood nutrition will help over 65,000 students access food during the summer and an additional 11,000 students meals during the school year in Montana.

Child Tax Credit

The extended Child Tax Credit, which was first passed by Congress as part of the American Rescue Plan, is a significant step in addressing childhood poverty. Over 9 out of 10 (209,000) children benefit from the credit in Montana. Here is what the recent framework does.

• Extends benefit amount for one year. The increase in the size of the credit is extended for one year into 2022, with families receiving $3,600 a year for children aged 0-5 and $3,000 for ages 6-17.
• Makes refundability permanent. Before this bill, one-third of children in Montana did not receive the full benefit of the CTC because their families earned too little. Under the new plan, the credit will be fully refundable, meaning all families will receive the full amount on their refund, even if they owe less in taxes than the credit amount. This change will reduce childhood poverty by an estimated twenty percent nationwide.

Research shows that Montanans are using their Child Tax Credits to pay for food, utilities, housing, childcare, and provide kids with educational opportunities. This framework is an important step forward to address the crises facing Montana children and families.