(Missouri Independent) – A major area of bipartisan agreement among Missouri lawmakers this year is improving access to affordable child care.
And on Wednesday afternoon, Gov. Mike Parson is expected to lay out his vision for addressing what some legislators have framed as a child care crisis in Missouri.
Missouri House Minority Leader Crystal Quade, D-Springfield, told reporters earlier this month that she expects child care to be a bipartisan priority this session, and legislators are looking to Parson’s annual State of the State address to lay out his agenda on the issue.
“I am very excited to know that Gov. Parson is going to make child care a part of his State of the State and hopefully have some really good initiatives around it,” Quade said in an interview with The Independent.
Parson will speak to a joint session of the legislature at 3 p.m. Wednesday.
Lawmakers have widely framed child care as a top issue facing state businesses, as well as children’s early development.
“Child care is something that it seems like everybody’s interested in,” Senate President Pro Tem Caleb Rowden, R-Columbia, told reporters last week.
Senate Minority Leader John Rizzo, D-Independence, said child care access is “a problem that Democrats said was coming a decade ago.
“So, we’re glad that (Republicans) are coming to our side of the table on this issue,” he said.
Parson’s speech could provide clarity as to what prioritizing child care in the state could look like in the coming months — and it is an issue that could align with his longtime focus on workforce development since child care needs can interfere with people’s ability to enter and stay in the workforce.
“I’ve had a lot of folks lift up the problem to me,” House Budget Chairman Cody Smith, R-Carthage, said about access to affordable child care. “I haven’t had a lot of folks lift up solutions to me.”
A 2021 report from the U.S. Chamber of Commerce Foundation estimated Missouri loses over $1.3 billion annually from accessibility, quality, and cost-related hurdles to child care. That loss is composed of the cost to employers when employees leave or miss work due to child care issues, plus the cost to the state of missed tax revenue when employees lose income.
States’ leeway in the child care realm includes: enacting state-level tax credits for parents or businesses; setting income limits and other restrictions for the child care subsidy program, which assists low-income families; and running state-provided pre-kindergarten programs.
It is not yet clear which policies Parson will prioritize. Rowden cautioned against a “state-funded and sanctioned…monopoly,” instead suggesting tax credits might be a route for the state to incentivize child care.
Missouri is among the half of states without a version of the federal tax credit to assist parents with child care, according to the public policy nonprofit the Committee for Economic Development. Studies have found that low-income families are far less likely to qualify for and receive those kinds of income deductions than higher-income families.
As is the case nationally, Missouri has seen the costs of child care soar over decades, outpacing inflation and frequently topping the list of household expenses — while often exceeding the cost of in-state university tuition.
The average cost for an infant in Missouri center-based child care was $10,555, as of 2021, according to Child Care Aware, meaning that the median-earning married couple would spend 11% of family income on child care, and the median-earning single-parent family would spend 36% of their income on child care.
High costs, though, rarely translate into a lucrative business for child care providers. Providers often make poverty-level wages with few benefits but have legal responsibilities to maintain certain ratios of staff to children, which can exacerbate staffing shortages and increase costs.
The median hourly wage for a child care worker was just under $12 in 2021 and the median salary was just under $25,000, according to Missouri Economic Research and Information Center’s Occupational Employment and Wage Estimates’ 2021 data.
Accessibility hurdles leave over half of Missourians in a child care desert: 54% of Missourians live in what the Center for American Progress defines as a child care desert, per their most recent data, from 2018. That number is higher — 70% — for rural families who live in a child care desert. (CAP defines a child care desert as lacking any child care or with so few options that there are more than three children for each licensed slot.)
In fiscal year 2022, the number of regulated child care providers overall declined by nearly 10%, according to the state Office of Childhood’s 2023 strategic plan.
A handful of bills, including to authorize a property tax exemption for property used for child care, and to increase state reimbursements to school districts with early childhood programs, have been filed already this session.
Expanding access to child care subsidies or state-run pre-K programs are strategies other states have used to mitigate the effect of child care costs on the lowest-income families.
Only one in every three economically-disadvantaged children from birth to age five accesses Missouri’s publicly-funded early care programs targeting low-income families, according to the Office of Childhood’s 2023 strategic plan.
States’ income restrictions for child care subsidies vary widely. A family of four in Missouri can make no more than $41,625 to qualify for child care assistance, which was just 150% of the federal poverty line last year.
Missouri was one of ten states with the most severe income eligibility requirements in 2019, according to the most recent federal report: At that point, Missouri was one of ten states where a family of three earning $30,000 would not qualify for benefits. (Now, the limit for a three-person family in Missouri is around $34,000.)
In Oklahoma, on the other hand, a family of three can make up to $48,708 to qualify, and a family of four can make up to $57,984.
In 2019, Parson also emphasized child care leading up to the State of the State but did not significantly increase funding for the state’s preschool program to expand.
Missouri’s state-funded preschool programs have a relatively limited reach: less than 10% of 4-year-olds were served in the programs in 2020, according to the National Institute for Early Education Research (making it rank 41st for access for 4-year-olds to public preschool.) A handful of states offer more expansive programs, including neighbor Oklahoma, which also sets the same wages as K-12 teachers for teachers in their pre-K program for 4-year-olds.
In 2020, Missouri was among the 10 states that spent the least, in terms of all reported spending on child care, and ranked in the bottom third based solely on state spending.
Parson’s priorities might take on particular importance because Missouri has received over $1 billion in one-time federal COVID relief funds for stabilizing the child care industry, but the remainder of those funds will soon expire.
Smith said the COVID relief dollars for child care “should be a tremendous shot in the arm to the child care industry across the state.”
“The question then becomes what happens after that money is gone,” Smith said.
The latest COVID child care funding, awarded through the American Rescue Plan, must be allocated by the end of September. A spokesperson for the Department of Elementary and Secondary Education said in an email to The Independent Tuesday that of the $325 million appropriated to the department to spend in this fiscal year, they have $164 million left to be disbursed.