[Congressional Record Volume 147, Number 102 (Friday, July 20, 2001)]
[Senate]
[Pages S8022-S8023]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DODD (for himself, Mr. DeWine, Ms. Snowe, Mr. Kennedy, Mr. 
        Roberts, Mr. Johnson, Mr. Edwards, Mrs. Feinstein, Ms. Collins, 
        Mr. Wellstone, Mr. Bingaman, and Mrs. Murray):
  S. 1217. A bill to provide for the acquisition, construction, and 
improvement of child care facilities or equipment, and for other 
purposes; to the Committee on Health, Education, Labor, and Pensions.
  Mr. DODD. Mr. President, I am pleased to join with my colleague from 
Ohio, Senator DeWine, in introducing the Child Care Facilities 
Financing Act. We are also joined by Senator Snowe, Senator Kennedy, 
Senator Roberts, Senator Johnson, Senator Edwards, Senator Feinstein, 
Senator Collins, Senator Wellstone, Senator Bingaman, and Senator 
Murray as original cosponsors.
  According to the Bureau of Labor Statistics, about 13 million 
children under age 6 and 31 million children between the ages of 6 and 
17 have both parents or their only parent in the work force.
  The demand for quality child care is exploding. But the supply of 
care has not kept pace, particularly in low-income communities where 
demand has been stimulated by a strong economy and employment 
requirements under welfare reform.
  Studies show that the supply of home-based and center-based child 
care is far more abundant in affluent areas than in low-income areas. 
Moreover, despite increased child care spending by states and the 
expansion of Head Start, physical space continues to remain scarce or 
unaffordable in low-income communities.
  Existing child care programs in too many low-income neighborhoods are 
crammed into inadequate, temporary quarters, leaky church basements, 
apartments, and other locations that were never designed for this 
purpose. Between the overall shortage of child care and inadequate 
existing facilities, parents have limited choices among inferior 
quality care, at times unsafe care for children.
  The United States has carried out the most extensive systematic, and 
rigorous research on investing in early education and child care 
programs. This research has shown that brain development is fastest 
during a child's earliest years.
  We know that quality child care can significantly assist in preparing 
children for school. The shortage in the supply of quality child care 
too often translates to inferior quality care for children.
  One of the contributing factors to the child care shortage is the 
difficulty that would-be providers face in financing child care 
facility development. Financial institutions often view child care 
providers as high risks for loans.
  In low-income neighborhoods, child care providers face severely 
restricted revenues and low real estate values. In urban areas, would-
be child care providers must contend with buildings in poor physical 
condition and high property costs.
  In all areas, reimbursement rates for child care subsidies are 
generally too low to cover the recovery cost of purchasing or 
developing facilities, especially after allowing for the cost of 
running the program. In addition, new providers often have no business 
training, and may need to learn how to manage their finances and 
business.
  The Child Care Facilities Financing Act would provide grants to 
intermediary organizations, enabling them to provide financial and 
technical assistance to existing or new child care providers--
including both center-based and home-based child care.

  The financial assistance may be in the form of loans, grants, 
investments, or other assistance, allowing for flexibility depending on 
the situation of the child care provider. The assistance may be used 
for acquisition, construction, or renovation of child care facilities 
or equipment. It may also be used for improving child care management 
and business practices.
  Grant funds under our legislation are required to be matched 50-50, 
further enhancing local capacity by leveraging

[[Page S8023]]

Federal funding and creating valuable public/private partnerships. The 
added benefit in providing this kind of assistance is that it will spur 
further community and economic development by building local 
partnerships.
  Reducing parental anxiety about child care means that parents can 
become more reliable and productive workers. An evaluation of 
California's welfare-to-work program found that mothers participating 
in the program were twice as likely to drop out during the first year 
if they expressed dissatisfaction with the child care provider or 
facility they were using.
  Let me share with you an example from my state of Connecticut. In the 
Hill neighborhood of New Haven, one of the most underserved areas of 
the city, there are more than 2,500 children under the age of five, but 
just 200 licensed child care spaces, including family care.
  LULAC Head Start has been serving the Hill neighborhood since 1983, 
operating a part-day, early childhood program out of a cramped and 
poorly lit church basement. This basement program could no longer be 
licensed by the state and recently closed. The 54 children being served 
were moved to another location which is overcrowded.
  Thanks to a collaboration between the Hill Development Corporation, 
LULAC Head Start and the New Haven Child Development Program, low-
income families in the Hill community will have more access to 
affordable and high-quality child care services.
  A new facility, the Hill Parent Child Center, is under construction 
and will provide multicultural child care, school readiness, and Head 
Start services for 172 low-income children in New Haven.
  Fortunately for this Hill Community, Connecticut has a new child care 
financing program. Connecticut multi-Cities Local Initiatives Support 
Corporation and the National Child Care Initiative joined forces with 
the State of Connecticut to design a program to finance the development 
of child care facilities.
  Unfortunately, there are many more children in New Haven and other 
parts of Connecticut as well as across the Nation who sill need child 
care. Sadly, most States do not have a child care financing system in 
place.
  We should do all we can to ensure that safe, affordable, quality 
child care is available for more families, particularly low-income 
families, so that we can truly leave no child behind. When the economic 
situation of families improve, distressed communities become 
revitalized.
  Expanding the supply of quality child care is an important step in 
investing in the needs of families with young children.
  I hope that you will join with Senator DeWine and me in supporting 
this legislation to ensure that parents have as many choices as 
possible in selecting child care while they work. It is hard enough for 
low-income families to make ends meet without the additional anxiety of 
poor choices of care for their children.
  I ask unanimous consent that a brief summary of the legislation be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                The Child Care Facilities Financing Act


                              the problem

       Many low-income communities face a severe shortage of child 
     care and equipment.
       Child care providers in low-income areas often lack the 
     access to capital and management expertise to expand the 
     capacity and the quality of their programs.
       A lack of affordable child care threatens the ability of 
     low-income parents to find and maintain stable employment.
       Quality child care can really make a difference in a 
     child's ability to start school ready to learn.


                              the solution

       The Child Care Facilities Financing Act authorizes $50 
     million annually to fund grants to non-profit intermediaries 
     to enhance the ability of home- and center-based child care 
     providers to serve their communities. Funds will be used to 
     provide:
       Financial assistance by intermediaries, in the form of 
     loans, grants, and interest subsidies, for the acquisition, 
     construction, or improvement of facilities for home- and 
     center-based child care and technical assistance to improve 
     business management and entrepreneurial skills to ensure 
     long-term viability of child care providers.
       The Child Care Facilities Financing Act requires that the 
     federal investment be matched, dollar for dollar, by funds 
     from the private sector, stimulating valuable public/private 
     partnerships.


                       building on a proven model

       The Child Care Facilities Financing Act draws from the 
     community development model--using small, seed-money 
     investments to leverage existing community resources.
       Tested in communities across the nation, this approach has 
     been proven to be successful in expanding child care 
     capacity:
       In New Haven, Connecticut, the Local Initiatives Support 
     Corporation (LISC) established the Community Investment 
     Collaborative for Kids--closing on $3.6 million in public-
     private financing to construct a new 10 room, 171 child Head 
     Start and child care center on a vacant lot in a low-income 
     neighborhood.
       The Ohio Community Development Finance Fund offers stable 
     resources for planning, technical assistance and funding for 
     the development of expanded quality child care space. It 
     leverages $26.11 for every $1.00 in public funding and has 
     touched the lives of over 13,000 Ohio children. Wonder World, 
     an urban child car center in Akron, Ohio, was operating in a 
     dingy and poorly lit space of an old church. Despite these 
     conditions the center had a waiting list. With help from the 
     Ohio Community Development Finance Fund, a new eight room 
     child care facility was constructed serving approximately 200 
     children.

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