Protecting Investments in the Child Care Scholarship Program
HB 495 / SB 350 raises the floor for Child Care Scholarship eligibility and benefits to their current, historically high levels, while providing critical safeguards against cost cutting in the future. The value to parents, children, and child care providers will be enormous. This legislation will serve as a springboard for future advocacy to expand access to affordable child care to all Maryland families. Scroll to detailed information
Lowering Barriers for Child Care Participation in Pre-K
The principle of “mixed delivery” is a cornerstone of pre-K expansion in Maryland, but the public-private partnerships needed for mixed delivery to work have been hamstrung by certification barriers that prevent most high-quality child care programs from participating. HB 1219 / SB 893 requires the State to establish viable alternative pathways to certification that recognize prior learning criteria and build on providers’ strengths. Scroll to detailed information
Implementing Time to Care
Last year’s landmark Time to Care Act put Maryland on the path to having one of the country’s strongest and most comprehensive family and medical leave insurance programs, but that bill left important considerations to be determined. This year’s HB 988 / SB 828 codifies employer-employee cost sharing on an equal basis, among other key provisions. Scroll to detailed information
Strengthening Family Economic Security
The Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) are the most powerful anti-poverty tools local, state, and federal governments have at their disposal. HB 547 / SB 552 will permanently strengthen Maryland’s EITC and CTC and provide additional aid to millions of Marylanders. Combined, the two tax credits could benefit more than 400,000 Maryland taxpayers, and the CTC alone could lift 40,000 children out of poverty. Scroll to detailed information
Public Policy Report
Veteran Annapolis hall-haunters found themselves at a loss to describe the peculiar characteristics of the 2023 Session of the General Assembly. In superficial ways the Session marked a return to something resembling the “old normal.” At gaveling-in on January 11, it once again felt like a first day back at school. The familiar round of Sine Die receptions formed a festive ring around State Circle on a mild April Monday. In-between, 90 days of bill introductions, committee meetings, debate, negotiations, and vote tallies proceeded without major interruption. And yet…
Shadows of the pandemic never seemed far removed. Pacing felt oddly off. A crater lay where the Department of Legislative Service Building had stood, and the diaspora of DLS staffers added to the sense of dislocation. The Senate and House of Delegates charted separate procedural tacks, rejiggering in sometimes confusing ways various remote options and hybrid methods from the two prior Sessions. Days of crowded hearing dockets alternated with hours when scattered lobbyists asked each other “where is everybody?” Following the fall elections and a return to single-party rule, an abundance of new players took up pivotal roles at every level of government, even as key appointments, shifting Committee assignments, and special elections of new legislators carried into March.
“It was all just weird, and pretty messy, but in the end reasonably productive,” one seasoned politico noted. Challenges aside, the 2023 Session brought major progress in policy areas of key concern to Maryland Family Network, including as always child care, pre-kindergarten expansion, and family economic security. Here are some highlights.
Protecting Investments in the Child Care Scholarship Program
Maryland's Child Care Scholarship Program (CCS) helps parents enter and remain in the workforce by subsidizing the high cost of child care. It gives parents and children access to licensed early education programs. In short, CCS keeps parents earning and children learning. The enactment of HB 495 / SB 350 “Early Childhood Development – Child Care Scholarship Program – Alterations” marks an inflection point in the evolution of child care in Maryland.
Prior to 2018, Maryland had one of the very worst child care subsidy programs in the country, according to testimony in Annapolis by a top US-HHS official. That year launched a succession of dramatic improvements to CCS—raising subsidy rates, expanding family eligibility, and capping or altogether eliminating copayments—that reached a high point in 2022. Scholarship rates were increased to the 70th percentile of the market, up from their abysmal 9th percentile level just four years previously. The family income eligibility limit was expanded to just over $90,000 for a family of four, compared to $35,000 for a similar family in 2018. Onerous parental copayments were eliminated for many families and drastically reduced for all others.
While both State and federal funds have underwritten these dramatic improvements, the latest round of incremental enhancements utilized American Rescue Plan Act (ARPA) dollars. Under federal rules, ARPA funds earmarked for child care must be spent by the end of FY24 and will expire thereafter. According to the Maryland State Department of Education (MSDE), which administers CCS, these program enhancements will cost an additional $52.1 million to $60.4 million per year (over a base budget of approximately $130 million).
One critical component HB 495 / SB 350 establishes the historically high 2022 scholarship rates, expanded family eligibility criteria, and low copayment levels as the program's new baseline, even after the expiration of ARPA funds. The second component of the bill mandates that any future cost-cutting measures, such as an enrollment freeze, may not be imposed unless MSDE notifies the General Assembly in advance, with sufficient time for the General Assembly to review and take corrective action.
Maryland families, children, and child care programs have endured several multi-year periods of CCS enrollment freezes and waiting lists since the early 1990s. In each case, the freezes were instituted unilaterally by MSDE or the previous agency responsible for administering CCS. The most recent enrollment freeze was imposed in 2011 and was not fully lifted until 2018. At the high-water mark, more than 20,000 children languished on a CCS waitlist. Meanwhile, in FY16, FY17, and FY18, despite the lingering wait list, MSDE underspent available funding for CCS by more than $55 million.
Both components of this bill give the General Assembly a critical new degree of CCS ownership, oversight, and accountability. Due to the nature of government funding, legislation cannot guarantee that cutting costs will never be necessary. However, ensuring that the General Assembly has an opportunity to review proposed measures and possibly take action—by reallocating resources, for example, or forcing a reprioritization of the agency's agenda—changes the rules of engagement.
Lowering Barriers for Child Care Participation in Pre-K
A cornerstone of pre-K expansion under the “Blueprint for Maryland's Future”—the State's landmark 2020 education reform bill—is “mixed delivery,” the principle that publicly funded pre-K for 3- and 4-year-olds should be offered not solely in public schools. High-quality providers already established in their communities, such as child care programs, can receive public funds to educate pre-K students, provided that the quality of the education is the equivalent of what those pupils would receive in a public school classroom.
The importance of mixed delivery is four-fold: it allows school systems to focus funds on instruction rather than capital costs; it better meets the wrap-around care needs of working parents; it incentivizes the expansion of quality for all children served in the community-based programs, not just the pre-K population; and it avoids undermining the affordability of child care for children birth through age 3.
Putting the mixed delivery principle into practice has been threatened by requirements that lead pre-K teachers hold traditional academic certification, raising insurmountable hurdles for most child care providers, regardless of their ability. To cite just one example, demanding that teaching certification candidates perform a “practicum” in a public school effectively requires child care providers to leave their jobs for training in a school setting, disrupting both their livelihoods and the continuity of care for children in their programs. In all likelihood, many of those providers will not return to child care, exacerbating the early childhood workforce shortage and further undermining the goals of mixed delivery.
HB 1219 / SB 893 “Maryland Educator Shortage Reduction Act of 2023” requires MSDE, in cooperation with institutions of higher education and other stakeholders, to establish a viable alternative pathway to certification that includes standards for the evaluation of prior learning, knowledge, and skills that child care professionals have developed during their careers. The legislation also extends the timeline for meeting certification requirements from the 2025-26 school year to 2027-28. These provisions alone offer no guarantees, but while honoring the Blueprint's quality imperatives, the legislation takes major strides to ensure the equitable participation of child care providers in the expansion of pre-K.
Implementing Time to Care
MFN has long championed family-friendly workplace policies to give parents opportunities to balance the demands of their jobs with their families' needs. After years of work culminating in a veto override on the final weekend of the 2022 Session, Maryland became the 10th state (plus the District of Columbia) to create an insurance fund to provide partial wage replacement for workers taking time away from jobs to care for new babies, loved ones with serious health conditions or disabilities, or themselves.
Maryland's Family and Medical Leave Insurance Program (FAMLI), created by the Time to Care Act, has been hailed as one of the country's strongest and most comprehensive programs of its kind. But enactment last year left some substantive implementation considerations to be determined. HB 988 / SB 828 ”Family and Medical Leave Insurance Program – Modification” reflects the results of further analysis conducted in the 2022 Interim as well as discussions and compromises among advocates, private insurers, the business community, legislative leaders, and the State Department of Labor (DOL).
Notably, the new legislation codifies an equal, 50-50 split in contributions by employees and employers to the FAMLI fund. The overall contribution rate will be determined annually by DOL based on current data and solvency projections, but it may not exceed 1.2 percent of an employee's wages. (Experts estimate the actual total rate will fall between roughly 0.7 percent and 0.9 percent of wages.) Employees are no longer required to exhaust earned paid leave, such as vacation or sick time, before being eligible for FAMLI benefits. The timelines for collecting contributions and paying benefits have been pushed out a year—to October 1, 2024 and January 1, 2026, respectively—in keeping with best practices from other states and to accommodate program development needs at DOL.
Advocates initially hoped this legislation would proceed smoothly, but it provided an opportunity for the lingering opposition to attempt to relitigate and potentially undermine key elements of the program. Diligent work by the Time to Care Coalition and stalwart support from our legislative leaders ensured final passage on Sine Die.
Boosting Family Economic Stability
The Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) are the most powerful anti-poverty tools local, state, and federal governments have at their disposal, and economic policies promoting their use and expansion have long been embraced by MFN. HB 547 / SB 552 “Family Prosperity Act of 2023” will permanently strengthen Maryland's EITC and CTC and provide additional aid to millions of Marylanders in years to come.
Introduced by the Governor, this legislation was spearheaded by longtime MFN allies Maryland CASH, the Maryland Center on Economic Policy, and other leaders of the Tax Credits for Working Families Coalition, of which MFN is a member. It makes permanent what were temporary changes to the State EITC enacted in 2021, which greatly increased its value from 28 percent to 45 percent of the federal credit and extended eligibility to those taxpayers (typically immigrants) who file using an Individual Taxpayer Identification Number in lieu of a Social Security Number.
Furthermore, the Family Prosperity Act makes permanent Maryland's refundable CTC, also enacted in 2021, under which eligible families will now be able to claim a $500 credit for children under 6 and older children with disabilities. CTC eligibility was previously limited to families earning $6,000 or less; eligibility will now extend to families earning up to $15,000.
Combined, the two tax credits could benefit more than 400,000 Maryland taxpayers. The CTC alone could lift 40,000 Maryland children out of poverty. Although the target population for these tax credits is relatively narrow, the benefits to young children, their families, and society as a whole are arguably broader than we can calculate.
Budget advocacy always constitutes a top priority for MFN. In 2023, allocations to key programs held ground in many cases and saw scheduled increases (via Blueprint funding) in others. The latter category includes an additional $990,000 for the State's network of Patty Centers (also known as Family Support Centers), bringing total FY24 funding for the network to $10.2 million.
Gray clouds have appeared on the horizon, however. Several tranches of federal pandemic relief funds that have weighed favorably on Maryland's balance sheet since 2020 are dwindling toward expiration. An unexpectedly robust economic rebound that bolstered the State's fiscal outlook a year ago appears to be dissipating. After a disheartening report from the Bureau of Revenue Estimates early in Session, the Governor and the General Assembly reckoned with a projected $500 million revenue write-down. Ambitions that ran high in the wake of the election suddenly had their brakes firmly applied. Economic indicators leading into the 2024 Session will be monitored carefully.
Moving forward, MFN's public policy work of necessity continues throughout the Interim between General Assembly sessions, as freshly minted legislation is implemented, task forces meet, new budget proposals are developed, contracts are negotiated, regulations are promulgated, and new ideas for legislation emerge for discussion and debate. Diligent follow-up by MFN and its allies on the continuing implementation of FAMLI, the development of alternative pathways to pre-K teaching certification, and the ongoing evolution of child care in Maryland will be vital to their success.
The 2023 Session brought Maryland a new Governor, and for the first time in eight years, the majority party controls all floors of the State House. The rosters of the Senate and the House experienced heavy turnover, and key committee assignments and leadership positions underwent—and in some cases are still undergoing—major transition. Outwardly, party unity can help advance priorities, but it can also mask competing agendas and the role conflicts inherent to the political process. Altered power dynamics and steep learning curves have transformed the Annapolis landscape in ways that are still coming into focus.
In times of change and challenge, the role of a respected and resourceful advocate grows all the more critical. MFN will stand prepared to protect the needs and advance the interests of Maryland's young children and their families.
Special thanks are due to the organizations that targeted funds for MFN's advocacy work in 2023: The Alliance for Early Success, the Annie E. Casey Foundation, the Baltimore Community Foundation, the Fund for Change, the Hopewell Fund, the Richman Family Foundation, the Sherman Family Foundation, the Thalheimer-Eurich Charitable Fund, and the Wright Family Fund.