Somewhere in the normalizing of two-income households and working, single-parent families, compensation for childcare never became a payroll benefit. Consequently, Montana families pay a price, say childcare advocates.
“It’s expensive. Right now, parents might pay upwards of $12,000 a year for childcare. For many families, this is the largest monthly expense, even more than their mortgage or rent,” said Caitlin Jensen, executive director of Zero to Five, a nonprofit focused on improving the lives of children, pre-birth to kindergarten.
Consider this: A 2020 survey of Montana parents concerning childcare found that 62% had missed work because of childcare problems. The survey by the University of Montana Bureau of Business and Economic Research also found that 22% of the parents had turned down a job offer because of childcare concerns, another 26% had declined further training or education for the same reason. Of those parents surveyed, 15% changed from full-time to part-time work for lack of childcare. Most of those responding did so before the COVID-19 pandemic brought a new wave of childcare challenges to the state.
Childcare advocates are now hopeful that some of these concerns can be addressed this month when the U.S. Senate takes up President Joe Biden’s Build Back Better plan, a $2 trillion spending package with a large investment in both childcare subsidies for parents and federal support for the development of pre-kindergarten, or Pre-K programs.
The childcare investment is roughly $67 billion a year for the next six years. The goal would be to cap household childcare expenses at 7% of household income for families earning 250% of the state median income, while lower income households would pay nothing. The sliding scale for the co-pay would be based on state median household income.
The U.S. Census Bureau puts Montana’s 2019 median income for families at $54,970 and $28,409 for an individual.
The non-profit Center for Law and Social Policy estimates that a single parent in Montana earning $57,000 a year would pay between $570 to $1,140 a year under the proposed childcare plan. It would be up to the parent to choose a provider.
“It just feels like this is something that a lot of parents need, and a lot of employers need,” Jensen said. “And, I think it would be a big support, an incentive for keeping families here,” Jensen said.
“We need to think about what we’re doing now to build stronger opportunities for kids, as they’re becoming teens and then adults and then having families of their own,” she added.
The second prong of the plan is for pre-kindergarten. There’s $110 billion to be invested in existing state pre-K programs. Like the $400 billion in the childcare plan, the money for pre-K is to be spent over six years.
Really, childcare and pre-K have to work together for families, said Heather O’Loughlin, Montana Budget and Policy Center co-director. The needs are different, childcare for infants and children in their first years of life is the most expensive care. The pre-kindergarten that follows becomes a difference-maker for later success in school, which can lead to better employment in adulthood.
“The reality is, this is critical assistance,” O’Loughlin said. “For families, if you have an infant today, what you’re really looking for is assistance that gets you through age 5.”
Pre-K in Build Back Better is intended to build on what states already have for prekindergarten. There isn’t a statewide pre-K school program in Montana. The state had a two-year pilot program championed by Montana’s former Democratic Gov. Steve Bullock. But the program expired and despite some bills to resurrect pre-K, debates over funding have stalled those plans.
“Montana is one of a handful of states that doesn't provide state investment in pre-K. So, there are important decisions that are going to have to be made by the state in order to roll out this funding and make sure that it works for Montana,” O’Loughlin said.
Similar to the childcare proposal in Build Back Better, there’s latitude for how the pre-K money is spent. The money can be invested in a federally-funded Head Start-styled program, folded into a public school system, or routed into a private provider, the goal being to develop programs with a learning curriculum aligned with Head Start standards.
One issue that’s going to have to be addressed with federal funding is improving the pay of the childcare workers and pre-K educators, O’Loughlin said. The pay is low in Montana, as compensation is for many jobs, which has made it difficult to attract childcare workers.
“One of the components of this package is that states really need to work on a plan that will ensure livable wages for staff and for childcare professionals. This is just a tremendous opportunity, that we're accessing federal dollars to begin to think about childcare as a profession and that it’s difficult work and to figure how to compensate for that,” O’Loughlin said.
Build Back Better is likely to pass only if Senate Democrats vote without a single dissenting member. Republicans are objecting to the expense of the plan. Republican Steve Daines has likened both Build Back Better and the $1 trillion infrastructure bill passed by Democrats earlier, to shooting money from a cannon. Though Republicans under former President Donald Trump approved $3.1 trillion in mostly fiscal stimulus related to COVID-19 in 2020, they have mostly objected to Biden’s spending proposals.
Montana’s at-large U.S. House representative, Republican Matt Rosendale, voted against the Build Back Better Act at it passed the House on party lines. Daines not only opposes Build Back Better, he’s singled out Sen. Jon Tester, a Montana Democrat, as having the ability to sink the proposal by joining Republicans in opposition.
Tester hasn't announced a position on Build Back Better because the package isn't final yet. He has been instrumental in negotiating terms acceptable to the center-left members of the Senate Democrats.
MBPC is a nonprofit organization focused on providing credible and timely research and analysis on budget, tax, and economic issues that impact low- and moderate-income Montana families.