[Congressional Record Volume 145, Number 112 (Tuesday, August 3, 1999)]
[Senate]
[Pages S10118-S10119]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REED (for himself, Mr. Dodd, Mr. Kennedy, Mrs. Feinstein, 
        Mr. Inouye, and Mrs. Murray):
  S. 1475. A bill to amend the Child Care and Development Block Grant 
Act of 1990 to provide incentive grants to improve the quality of child 
care; to the Committee on Health, Education, Labor, and Pensions.


                child care quality incentive act of 1999

  Mr. REED. Mr. President, I rise to talk about a crisis that is 
affecting the families of this country. That crisis is the child care 
system, the ability to obtain safe, affordable, high-quality child 
care.
  Today there are an estimated 13 million children, 6 million of them 
infants and toddlers, who require some form of day care. For working 
families, the price of this day care is exceedingly difficult to meet 
each and every day.
  Full-day child care ranges from $4,000 to $10,000 a year. For some 
low-income families, that represents 25 percent of their income.
  This is a huge obligation. We have, I fear and believe, the 
responsibility to ensure that we can help these families meet this 
obligation to protect their children. Not only is this necessary simply 
for the custodial protection and care of children, it is necessary for 
their enhancement, their advancement, for their intellectual 
development.
  We have discovered over the last several years, because of all the 
research that is being done at the National Institutes of Health, and 
other places, the crucial role of the early development of children in 
their ultimate intellectual and social development as adults.
  We know if we have good, nurturing care in the early days of life, 
this care will lead to better cognitive performance later on. It will 
increase classroom success. It will lead to more fully developed 
individuals who can cope with the challenges of this next century that 
is just upon us.
  So our investment in child care is not simply something that is 
altruistic--something we want to do because it is for the kids and for 
working families--it is in the best interests of this country in order 
to provide for the citizens of this country of the next century.
  We know also, as we look around, that one of the problems in child 
care, I say to Senators, is that because of the low reimbursement rates 
that the child care centers receive from the States, that they are not 
able to retain good employees and that they are not able to train the 
employees they can retain--particularly in this booming economy we see 
today.
  So what you have in so many child care centers is a situation where 
they cannot retain their employees, they cannot attract the very best 
employees, they do not have the resources to fully develop the 
potential for these employees, and as a result, ultimately, children 
suffer.
  In fact, there have been numerous studies. The one that I found most 
disturbing is one where four States were studied in the United States, 
and it was found that in those States only one out of seven child care 
centers provided care that promoted the healthy development of the 
child. Even more shocking, one in eight of these child care centers 
actually provided care that threatened the health of the child. We have 
to do something about it.

  Prior to welfare reform, there was a law on the books that said the 
State, when they were subsidizing day care for low-income parents, had 
to at least try to achieve the 75th percentile in terms of their 
reimbursement rate. What that means is that they had to have a 
reimbursement rate that could at least meet the cost of 75 out of 100 
of the centers in their particular State. That has gone by the wayside. 
But in order to keep quality in our child care system, we have to get 
to reimbursement rates that will, in fact, provide the resources for 
child care centers to have quality, enhancing care to benefit the 
children of this country.
  What has also been abandoned in the last several years is even the 
attempt by the States to go ahead and do surveys of the market so they 
know what it costs different child care centers to provide care and 
know what it costs for the parents to send their children to day-care 
centers. Having abandoned these market surveys, essentially there is no 
connection between their subsidy rate and, in fact, the cost of day 
care. So working families who receive these subsidies--and there are 
more and more families who are receiving subsidies as we move welfare 
recipients to work--have no correlation between what they are getting 
and essentially what the cost of child care is in the real world.
  What I have done, along with some of my colleagues, is introduce 
legislation that would, in fact, give the States an incentive, first to 
do their market surveys, to find out the cost of day care in their 
communities, and then to strive to meet those market rates.
  I have been very pleased to be joined by Senators Chris Dodd and Ted 
Kennedy, who are leaders in the field of improving child care in this 
country, together with Senators Feinstein, Inouye, and Murray in 
introducing the Child Care Quality Incentive Act. Essentially, this 
legislation would establish a new mandatory pool of funding, $300 
million each year over the next 5 years, as part of the Child Care 
Development Block Grant Program. This funding would be an incentive for 
States to first conduct a market survey and then to make significant 
movement towards raising their subsidy rates to that market rate. In so 
doing, we can directly contribute to the bottom line of these child 
care centers. They, in turn, can retain personnel, train their 
personnel, and create a more enhancing environment for the development 
of children. This, I think, is a goal we should have.
  Increased reimbursement rates also expand the number of choices 
parents have in finding quality child care.
  We will also, I hope, at the same time try to increase the overall 
scope of the child development block grants. One of the consequences of 
simply increasing funding for the child care development block grant, 
is many States will not increase the subsidy they pay for children; 
they will simply try to enroll more children. This puts centers in a 
very cruel dilemma because the more children they have at that far-
below-market rate the greater the economic pressure on the centers.
  The program I am presenting today with my colleagues would do what 
child care providers have argued must be done, and that is to give them 
additional resources so they can, in fact, improve the quality of day 
care--not simply the number of children in day care but the quality of 
day care. If we do these things we are going to be in a strong position 
to face the challenges ahead.
  One of the greatest challenges for working families is the cost of 
day care for their children. I have been very pleased to note that this 
legislation has been endorsed by the USA Child Care, the Children's 
Defense Fund, Catholic Charities of the United States, the Child 
Welfare League of America, the YMCA of the United States, the National 
Association of Child Care Resource and Referral Agencies, the National 
Head Start Association, the National Child Care Association and a host 
of other agencies and organizations throughout the country. They 
recognize, as I do, and as my colleagues who are introducing this 
legislation do, that we can talk a lot about child care, we can 
emphasize how important it is to families, we can stress the importance 
to our economy and to our long-run future in this country, but until we 
put real resources to work, we will not be able to meet the real needs 
of families. These needs grow each day.

[[Page S10119]]

  I urge strong support for this legislation. Again, I thank and 
commend my colleagues who have joined me in this effort: Senators Dodd, 
Kennedy, Feinstein, Inouye, and Murray, and encourage others to join 
us. I believe if we make this investment in quality child care, we will 
be making one of the most important investments we can make in the 
future of this country and in the individual future of families 
throughout the United States.
  I thank my colleagues for joining me, and I ask unanimous consent to 
have printed in the Record a copy of the legislation.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1475

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Care Quality Incentive 
     Act of 1999''.

     SEC. 2. FINDINGS AND PURPOSES.

       (a) Findings.--Congress makes the following findings:
       (1) Recent research on early brain development reveals that 
     much of a child's growth is determined by early learning and 
     nurturing care. Research also shows that quality early care 
     and education leads to increased cognitive abilities, 
     positive classroom learning behavior, increased likelihood of 
     long-term school success, and greater likelihood of long-term 
     economic and social self-sufficiency.
       (2) Each day an estimated 13,000,000 children, including 
     6,000,000 infants and toddlers, spend some part of their day 
     in child care. However, a study in 4 States found that only 1 
     in 7 child care centers provide care that promotes healthy 
     development, while 1 in 8 child care centers provide care 
     that threatens the safety and health of children.
       (3) Full-day child care can cost $4,000 to $10,000 per 
     year.
       (4) Although Federal assistance is available for child 
     care, funding is severely limited. Even with Federal 
     subsidies, many families cannot afford child care. For 
     families with young children and a monthly income under 
     $1,200, the cost of child care typically consumes 25 percent 
     of their income.
       (5) Payment (or reimbursement) rates, the maximum the State 
     will reimburse a child care provider for the care of a child 
     who receives a subsidy, are too low to ensure that quality 
     care is accessible to all families.
       (6) Low payment rates directly affect the kind of care 
     children get and whether families can find quality child care 
     in their communities. In many instances, low payment rates 
     force child care providers to cut corners in ways that lower 
     the quality of care for children, including reducing number 
     of staff, eliminating staff training opportunities, and 
     cutting enriching educational activities and services.
       (7) Children in low quality child care are more likely to 
     have delayed reading and language skills, and display more 
     aggression toward other children and adults.
       (8) Increased payment rates lead to higher quality child 
     care as child care providers are able to attract and retain 
     qualified staff, provide salary increases and professional 
     training, maintain a safe and healthy environment, and 
     purchase basic supplies and developmentally appropriate 
     educational materials.
       (b) Purpose.--The purpose of this Act is to improve the 
     quality of, and access to, child care by increasing child 
     care payment rates.

     SEC. 3. INCENTIVE GRANTS TO IMPROVE THE QUALITY OF CHILD 
                   CARE.

       (a) Funding.--Section 658B of the Child Care and 
     Development Block Grant Act of 1990 (42 U.S.C. 9858) is 
     amended--
       (1) by striking ``There'' and inserting the following:
       ``(a) Authorization of Appropriations.--There''; and
       (2) by adding at the end the following:
       ``(b) Appropriation of Funds For Grants to Improve the 
     Quality of Child Care.--Out of any funds in the Treasury that 
     are not otherwise appropriated, there are authorized to be 
     appropriated and there are appropriated, for each of fiscal 
     years 2000 through 2004, $300,000,000 for the purpose of 
     making grants under section 658H.''.
       (b) Grants To Improve the Quality of Child Care.--The Child 
     Care and Development Block Grant Act of 1990 (42 U.S.C. 9858 
     et seq.) is amended by inserting after section 658G the 
     following:

     ``SEC. 658H. GRANTS TO IMPROVE THE QUALITY OF CHILD CARE.

       ``(a) Authority.--
       ``(1) In general.--The Secretary shall use the amount 
     appropriated under section 658B(b) for a fiscal year to make 
     grants to eligible States in accordance with this section.
       ``(2) Annual payments.--The Secretary shall make annual 
     payments to each eligible State out of the allotment for that 
     State determined under subsection (c).
       ``(b) Eligible States.--
       ``(1) In general.--In this section, the term `eligible 
     States' means a State that--
       ``(A) has conducted a survey of the market rates for child 
     care services in the State within the 2 years preceding the 
     date of the submission of an application under paragraph (2); 
     and
       ``(B) submits an application in accordance with paragraph 
     (2).
       ``(2) Application.--
       ``(A) In general.--To be eligible to receive a grant under 
     this section, a State shall submit an application to the 
     Secretary at such time, in such manner, and accompanied by 
     such information, in addition to the information required 
     under subparagraph (B), as the Secretary may require.
       ``(B) Information required.--Each application submitted for 
     a grant under this section shall--
       ``(i) detail the methodology and results of the State 
     market rates survey conducted pursuant to paragraph (1)(A);
       ``(ii) describe the State's plan to increase payment rates 
     from the initial baseline determined under clause (i); and
       ``(iii) describe how the State will increase payment rates 
     in accordance with the market survey findings.
       ``(3) Continuing eligibility requirement.--The Secretary 
     may make an annual payment under this section to an eligible 
     State only if--
       ``(A) the Secretary determines that the State has made 
     progress, through the activities assisted under this 
     subchapter, in maintaining increased payment rates; and
       ``(B) at least once every 2 years, the State conducts an 
     update of the survey described in paragraph (1)(A).
       ``(4) Requirement of matching funds.--
       ``(A) In general.--To be eligible to receive a grant under 
     this section, the State shall agree to make available State 
     contributions from State sources toward the costs of the 
     activities to be carried out by a State pursuant to 
     subsection (d) in an amount that is not less than 25 percent 
     of such costs.
       ``(B) Determination of state contributions.--State 
     contributions shall be in cash. Amounts provided by the 
     Federal Government may not be included in determining the 
     amount of such State contributions.
       ``(c) Allotments to Eligible States.--The amount 
     appropriated under section 658B(b) for a fiscal year shall be 
     allotted among the eligible States in the same manner as 
     amounts are allotted under section 658O(b).
       ``(d) Use of Funds.--
       ``(1) Priority use.--An eligible State that receives a 
     grant under this section shall use the funds received to 
     significantly increase the payment rate for the provision of 
     child care assistance in accordance with this subchapter up 
     to the 100th percentile of the market rate survey described 
     in subsection (b)(1)(A).
       ``(2) Additional uses.--An eligible State that demonstrates 
     to the Secretary that the State has achieved a payment rate 
     of the 100th percentile of the market rate survey described 
     in subsection (b)(1)(A) may use funds received under a grant 
     made under this section for any other activity that the State 
     demonstrates to the Secretary will enhance the quality of 
     child care services provided in the State.
       ``(3) Payment rate.--In this section, the term `payment 
     rate' means the rate of reimbursement to providers for 
     subsidized child care.
       ``(4) Supplement not supplant.--Amounts paid to a State 
     under this section shall be used to supplement and not 
     supplant other Federal, State, or local funds provided to the 
     State under this subchapter or any other provision of law.
       ``(e) Evaluations and reports.--
       ``(1) State evaluations.--Each eligible State shall submit 
     to the Secretary, at such time and in such form and manner as 
     the Secretary may require, information regarding the State's 
     efforts to increase payment rates and the impact increased 
     rates are having on the quality of, and accessibility to, 
     child care in the State.
       ``(2) Reports to congress.--The Secretary shall submit 
     biennial reports to Congress on the information described in 
     paragraph (1). Such reports shall include data from the 
     applications submitted under subsection (b)(2) as a baseline 
     for determining the progress of each eligible State in 
     maintaining increased payment rates.''.
                                 ______