Improving access to child care for low-income families in Wisconsin

Weekly Fiscal Facts are provided by the Wisconsin Policy Forum, the state’s leading resource for nonpartisan state and local government research and civic education. The Wisconsin Policy Forum logo can be downloaded here.

For increasing numbers of low-income families, Wisconsin’s child care subsidy program falls short of providing affordable care. This means a greater share of families participating in the Wisconsin Shares child care program have had to shoulder added financial responsibility for their children’s care.

In 2006, families qualifying for Wisconsin Shares could access 75% of the child care slots without contributing more than their family’s expected copay. By 2017, that share had fallen to 15%.

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Qualifying families, generally those with income up to 185% of the federal poverty level, who participate in Wisconsin Shares receive a debit card to pay their child care provider. The amount that is loaded onto each card depends on factors including family size, household income, and place of residence.

The federal grant program that provides some Wisconsin Shares funding recommends setting reimbursement levels so that families receiving a subsidy can access 75% of child care slots — although as of 2016, a national study found that only one state did so. The state Department of Children and Families, which oversees Wisconsin Shares, recently received a letter from the federal government warning the program is not complying with the conditions of the grant. It warned the state could face a penalty if it does not raise its maximum reimbursement rates so at least 25% of slots are considered accessible.

The governor’s proposal was intended to raise the share of slots considered affordable to 50%. Lawmakers put forward their own plan, included in the final version of the state budget, to raise the share of affordable slots by a smaller amount. While the new budget provides some relief for Wisconsin Shares families, and in the short term allows the state to meet the 25th percentile federal standard, it falls well short of the 50th percentile objective proposed by the governor.

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