On Jan. 6, the U.S. Department of Health and Human Services (HHS) froze several federal child care and family assistance funding streams to five states: California, Colorado, Illinois, Minnesota and New York. Citing concerns for fraud and misuse in state-administered programs, these states will be required to submit documentation before any federal payment is released.
This action applies to three programs administered by the Administration for Children and Families (ACF) within HHS:
- Child Care and Development Fund (CCDF): The CCDF program provides financial assistance to low-income families to access child care while they attend a job training or educational program. These funds are also used to support the quality of child care, including teacher training. The total amount of funds impacted by this freeze is close to $2.4 billion.
- Temporary Assistance for Needy Families (TANF): The TANF program provides temporary financial aid, child care, job training and other support to low-income families with children with the goal of promoting self-sufficiency. The total amount of funds impacted by the freeze is $7.35 billion.
- Social Services Block Grant (SSBG): The SSBG program allows states to provide a wide range of social services for vulnerable residents. The program allows for local flexibility to meet needs including counseling, child care, services for the disabled and housing assistance. The total amount impacted by this freeze is $869 million.
On Jan. 8, the States of New York, California, Colorado, Illinois and Minnesota filed a lawsuit in the United States District Court for the Southern District of New York (PDF) seeking relief, claiming that HHS does not have statutory on constitutional authority to freeze the funds and that barring immediate actions from the courts there would be significant disruptions to local economies.
On Jan. 9, a federal judge in New York temporarily blocked the freezing of funds and ordered HHS to release the funds for the next two weeks while the legal case continues in court.
How Federal Funding Cuts Impact Families and Children
Withholding or eliminating these federal funding streams may lead to the following:
- Child Care Programs Closing or Reduction in Classrooms: Child care providers and programs that rely on these funds may be forced to limit enrollment, lower classroom size or shut down entire programs, impacting access to high-quality early learning opportunities.
- Increased Strain on Working Families: Families who depend on these programs for financial well-being may be unable to afford or access quality options impacting their ability to participate in the workforce.
- Reductions in Early Childhood Workforce: Without adequate federal funding, programs may be forced to reduce staff sizes, close entirely or the early childhood workforce may be unable to receive necessary professional development opportunities, impacting an already strained profession.
- Gaps in Learning: Ensuring access to child care helps children build the skills necessary to succeed later in life. If such programs are no longer available, families and children are at risk of missing critical development opportunities.
- Disrupted Partnerships: Without such funds, collaborative efforts across key city and community stakeholders are at risk. Programs, relationships and coordinated efforts may result in a more fragmented child care system impacting the stability of the families, children and the early childhood workforce.
Local Impact and Action
For the cities, towns and villages in these five states, local residents and child care providers will feel the direct impact of the loss of federal funds. While cities cannot reverse these effects, they can take meaningful steps to stabilize and strengthen early childhood systems in their city, both in the short and long term. As we continue to navigate the political landscape, here are several ways to support and sustain early childhood and the early childhood workforce within your city:
- Assess the Local Landscape: Identify which child care programs are impacted by these federal programs, how many families are served and what alternatives exist to support residents in the absence of these funds.
- Use the Bully Pulpit for Local and Federal Advocacy: Local elected officials are the best champions to explain what the absence of these funds means and can use their platform to uplift the importance of early childhood and the early childhood workforce to the municipality’s overall economic development plans.
- Strengthen Cross-Departmental Collaboration: Local leaders can work to coordinate services across agencies and with state partners to develop a common set of outcomes and to amplify the importance of this work to the community.
- Deepen Local Partnerships: Local leaders can serve as convenors to bring together providers with community stakeholders including philanthropy, Community Development Financial Institutions and business partners, including chambers, to explore ways to build financial and business support for a coordinated, local child care strategy.
- Collect and Use Data: Data is essential in helping local leaders understand and advocate for policies or practice changes that can best support early childhood.
Cities have an important opportunity to elevate early childhood, align it with broader municipal priorities and identify what it will take to strengthen and sustain local systems for the future on behalf of children and families and, ultimately, the economic success of communities.
A Roadmap to Early Childhood Success
As a municipal leader, you play a critical role in shaping environments where young children — especially infants and toddlers from the prenatal stage through age three, their families and the early childhood workforce — can flourish. You face competing priorities across agencies and programs, often having to make tough decisions on where and how to invest during challenging political and budget climates. This resource helps you navigate those challenges while offering practical steps and best practices that help your residents.
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