[Congressional Record Volume 151, Number 23 (Thursday, March 3, 2005)]
[Senate]
[Pages S2037-S2040]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REED (for himself, Mr. Dodd, Mr. Kennedy, and Mrs. 
        Murray):
  S. 526. 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.
  Mr. REED. Mr. President, I am pleased to be joined today by Senators 
Dodd, Kennedy, and Murray in once again introducing the Child Care 
Quality Incentive Act, which seeks to redouble our child care efforts 
and renew the child care partnership with the States by providing 
incentive funding to increase payment rates.
  This legislation seeks to put high-quality child care within the 
reach of more working families. As things stand, States too often fund 
only a fraction of prevailing child care costs.
  Under the Child Care and Development Block Grant (CCDBG), States are 
required to perform market rate surveys every two years. Yet many 
States

[[Page S2038]]

disregard them when it comes time to setting their payment rates, the 
level at which States reimburse child care providers who care for low-
income children who receive a child care subsidy. As a result, States 
are unable to meet the law's promise to give eligible low-income 
families the same access to child care services as non-eligible 
families.
  At stake are safe, supportive, and educationally enriching 
environments for children during the formative years that set the stage 
for future performance in school and beyond. When payment rates are set 
too low, child care centers that serve low-income children struggle to 
survive and may have to close. If they choose to stay afloat despite 
the limited ability of families to pay, the tradeoffs directly impact 
the quality of care. Such tradeoffs include smaller staffs, underpaid 
employees with few or no benefits, and limited employee training, 
educational materials, and community services like health screenings. 
Those centers that avoid this route may turn low-income children away 
or be forced out of business.
  Under welfare reform we expect the neediest parents to hold jobs to 
sustain their families. We must also afford them responsible choices to 
protect their children while they pursue their economic future.
  Our legislation creates a new mandatory funding pool under the Child 
Care and Development Block Grant to help States increase payment rates, 
while requiring States to set payment rates in line with updated market 
rate surveys. As such, it will allow more low-income families access to 
quality child care, and increase the availability of quality child care 
for all families.
  Support for this legislation is strong among leading national 
organizations such as USA Child Care, the Children's Defense Fund, the 
YMCA of the USA, Catholic Charities of the USA, the Child Welfare 
League of America, and many more. A range of local and State 
organizations and providers have also offered endorsements.
  This year, Congress is slated to reauthorize the Child Care and 
Development Block Grant. I urge my colleagues to join Senators Dodd, 
Kennedy, Murray, and me in this endeavor to improve the quality of 
child care by cosponsoring the Child Care Quality Incentive Act and 
working to include its provisions in the CCDBG reauthorization. The 
time to bring payment rates in line with market realities is now. Only 
then will the commitment to offer equal access to quality child care 
ring true.
  Mr. President, I ask unanimous consent that the text of this 
legislation be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 526

       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 2005''.

     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 $12,000 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, which determine 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 serving low-income children to cut 
     corners in ways that impact the quality of care for the 
     children, including reducing the number of staff, eliminating 
     professional development 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, children's literature, 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. PAYMENT RATES.

       Section 658E(c)(4) of the Child Care and Development Block 
     Grant Act of 1990 (42 U.S.C. 9858c(c)(4)) is amended--
       (1) by redesignating subparagraph (B) as subparagraph (C);
       (2) in subparagraph (A), by striking ``to comparable child 
     care services'' and inserting ``to child care services that 
     are comparable (in terms of quality and types of services 
     provided) to child care services''; and
       (3) by inserting after subparagraph (A) the following:
       ``(B) Payment rates.--
       ``(i) Surveys.--In order to provide the certification 
     described in subparagraph (A), the State shall conduct 
     statistically valid and reliable market rate surveys (that 
     reflect variations in the cost of child care services by 
     locality), in accordance with such methodology standards as 
     the Secretary shall issue. The State shall conduct the 
     surveys not less often than at 2-year intervals, and use the 
     results of such surveys to implement, not later than 1 year 
     after conducting each survey, payment rates described in 
     subparagraph (A) that ensure equal access to comparable 
     services as required by subparagraph (A).
       ``(ii) Cost of living adjustments.--The State shall adjust 
     the payment rates at intervals between such surveys to 
     reflect increases in the cost of living, in such manner as 
     the Secretary may specify.
       ``(iii) Rates for different ages and types of care.--The 
     State shall ensure that the payment rates reflect variations 
     in the cost of providing child care services for children of 
     different ages and providing different types of care.
       ``(iv) Public dissemination.--The State shall, not later 
     than 30 days after the completion of each survey described in 
     clause (i), make the results of the survey widely available 
     through public means, including posting the results on the 
     Internet.''.

     SEC. 4. 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'';
       (2) in subsection (a), by inserting ``(other than section 
     658H)'' after ``this subchapter''; and
       (3) 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 is authorized to be 
     appropriated and there is appropriated $500,000,000 for each 
     of fiscal years 2006 through 2010, for the purpose of making 
     grants under section 658H.''.
       (b) Use of Block Grant Funds.--Section 658E(c)(3) of the 
     Child Care and Development Block Grant Act of 1990 (42 U.S.C. 
     9858c(c)(3)) is amended--
       (1) in subparagraph (B), by striking ``under this 
     subchapter'' and inserting ``under this subchapter (other 
     than section 658B(b))''; and
       (2) in subparagraph (D), by inserting ``(other than section 
     658H)'' after ``under this subchapter''.
       (c) Establishment of Program.--Section 658G of the Child 
     Care and Development Block Grant Act of 1990 (42 U.S.C. 
     9858e) is amended by inserting ``(other than section 658H)'' 
     after ``this subchapter''.
       (d) 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, and Indian tribes and tribal 
     organizations, in accordance with this section.
       ``(2) Annual payments.--The Secretary shall make an annual 
     payment for such a grant to each eligible State, and for 
     Indian tribes and tribal organizations, out of the 
     corresponding payment or allotment made under subsections 
     (a), (b), and (e) of section 658O from the amount 
     appropriated under section 658B(b).
       ``(b) Eligible States.--
       ``(1) In general.--In this section, the term `eligible 
     State' means a State that--
       ``(A) has conducted a statistically valid survey of the 
     market rates for child care

[[Page S2039]]

     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);
       ``(iii) describe how the State will increase payment rates 
     in accordance with the market survey results, for all types 
     of child care providers who provide services for which 
     assistance is made available under this subchapter;
       ``(iv) describe how payment rates will be set to reflect 
     the variations in the cost of providing care for children of 
     different ages and different types of care;
       ``(v) describe how the State will prioritize increasing 
     payment rates for--

       ``(I) care of higher-than-average quality, such as care by 
     accredited providers or care that includes the provision of 
     comprehensive services;
       ``(II) care for children with disabilities and children 
     served by child protective services; or
       ``(III) care for children in communities served by local 
     educational agencies that have been identified for 
     improvement under section 1116(c)(3) of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 6316(c)(3));

       ``(vi) describe the State's plan to assure that the State 
     will make the payments on a timely basis and follow the usual 
     and customary market practices with regard to payment for 
     child absentee days; and
       ``(vii) describe the State's plans for making the results 
     of the survey widely available through public means.
       ``(3) Continuing eligibility requirement.--
       ``(A) Second and subsequent payments.--A State shall be 
     eligible to receive a second or subsequent annual payment 
     under this section only if the Secretary determines that the 
     State has made progress, through the activities assisted 
     under this subchapter, in maintaining increased payment 
     rates.
       ``(B) Third and subsequent payments.--A State shall be 
     eligible to receive a third or subsequent annual payment 
     under this section only if the State has conducted, at least 
     once every 2 years, 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 the State pursuant to 
     subsection (c) in an amount that is not less than 20 percent 
     of such costs.
       ``(B) Determination of state contributions.--Such 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) 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 determined under 
     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 determined under 
     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) 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.
       ``(d) 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 
     payment rates are having on the quality of child care in the 
     State and the access of parents to high-quality 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.
       ``(e) Indian Tribes and Tribal Organizations.--The 
     Secretary shall determine the manner in which and the extent 
     to which the provisions of this section apply to Indian 
     tribes and tribal organizations.
       ``(f) Payment Rate.--In this section, the term `payment 
     rate' means the rate of reimbursement to providers for 
     subsidized child care.''.
       (e) Payments.--Section 658J(a) of the Child Care and 
     Development Block Grant Act of 1990 (42 U.S.C. 9858h(a)) is 
     amended by inserting ``from funds appropriated under section 
     658B(a)'' after ``section 658O''.
       (f) Allotment.--Section 658O of the Child Care and 
     Development Block Grant Act of 1990 (42 U.S.C. 9858m) is 
     amended--
       (1) in subsection (b)(1), in the matter preceding 
     subparagraph (A)--
       (A) by striking ``section 658B'' and inserting ``section 
     658B(a)''; and
       (B) by inserting ``and from the amounts appropriated under 
     section 658B(b) for each fiscal year remaining after 
     reservations under subsection (a),'' before ``the Secretary 
     shall allot''; and
       (2) in subsection (e)--
       (A) in paragraph (1), by striking ``the allotment under 
     subsection (b)'' and inserting ``an allotment made under 
     subsection (b)''; and
       (B) in paragraph (3), by inserting ``corresponding'' before 
     ``allotment''.

  Mr. KENNEDY. Mr. President, I'm pleased to join my colleagues in 
introducing the Caring for Children Act of 2005. We were able to work 
together on both sides of the aisle to prepare this bill to reauthorize 
the Child Care and Development Block Grant program. The Caring for 
Children Act reflects our common goals to expand access and improve the 
quality of child care for children and families throughout the Nation.
  Child care is a key issue in both welfare reform and education 
reform. The success of our welfare system rests on our ability to 
provide dependable and consistent child care support for low-income 
families, so that they can work and provide for their families. 
Improving the quality of child care and the environment in which our 
children develop is an essential responsibility of our society as a 
whole, and this legislation can be an important part of our effort in 
Congress to meet that responsibility.
  Today, 65 percent of parents with young children and 79 percent of 
parents with school age children are in America's workforce. During the 
working day, 14 million children are cared for by someone other than a 
parent.
  For low-income families and single mothers, child care assistance is 
a lifeline. Low-income mothers who receive child care assistance are 40 
percent more likely to remain employed after 2 years, compared to those 
who do not receive such support. Yet child care is still unaffordable 
for far too many families--full-day care can easily cost thousands of 
dollars a year and become an impossible expense for millions of 
families.
  The Caring for Children Act will expand access to child care and do 
more to deliver the support that working parents need in obtaining 
effective child care. The bill supports activities to help parents fmd 
quality care through State Resource and Referral Centers, so that 
greater information and outreach to parents will be available.
  Child care is a vital support for working parents, and it is also an 
essential link in preparing young children for school. Research shows 
that the early environments in which children learn and develop have a 
profound impact on their later development and on their success in 
school. Unfortunately, much remains to be done to improve the quality 
of child care. Nearly half of all kindergarten teachers report that the 
majority of children in each entering class has specific problems, 
including difficulty in following directions, lack of even the most 
basic academic skills, troubled situations at home, or difficulty in 
relating to other children.
  The Caring for Children Act seeks to improve the quality of child 
care available to low-income children and their families through the 
Child Care and Development Block Grant. The bill will raise the amount 
of funds that States must dedicate to quality activities from 4 to 6 
percent.
  Most important, the Act will promote better child care by focusing on 
activities that make children ready to learn, and encouraging States to 
improve child safety and well-being. Funds will be used to provide 
greater training and support for child care workers, establish 
voluntary guidelines for school preparedness, and enhance the early 
learning of young children.
  Investments in the child care workforce are also essential to improve 
the quality of care. Today, only one in

[[Page S2040]]

seven child care centers provides a level of quality adequate for child 
development. Thirty states have no pre-service training requirements 
for child care workers. Our bill supports professional development and 
education opportunities for child care providers to upgrade their 
skills and to use proven and effective early learning materials and 
teaching strategies in their work. It encourages states to increase the 
recruitment and retention of qualified child care staff and reduce the 
high turnover rates in child care centers.
  We must also do more to ensure that states provide timely and 
adequate payments for high quality care. The Caring for Children Act 
will improve reimbursement rates for care in the states, and more 
effectively use the market survey required under current law to 
establish payment rates. I commend Senator Reed for his leadership on 
those provisions.
  Finally, the Caring for Children Act creates a new Federal commitment 
to serve children in need, including families with infants and 
toddlers, children with disabilities, and families that require special 
care during non-traditional work hours. Thanks to Senator Harkin's 
leadership, the needs of infants and toddlers will continue to be 
addressed in this bill.
  The Caring for Children Act builds on effective practices already 
underway in many states, but we still have a long way to go to see that 
all children have access to good child care. More resources are clearly 
required, and the need is urgent.
  In nearly half the states, eligible children are being placed on 
waiting lists or being turned away altogether. In Massachusetts, over 
16,000 low-income children are on waiting lists.
  Instead of responding to this need, the President's budget for Fiscal 
Year 2006 freezes funding for the Child Care and Development Block 
Grant. Under the Administration's own calculations, 300,000 fewer low-
income children will have access to child care assistance by 2010. 
Surely, we can do better.
  It makes no sense to cut back on child care for low-income children. 
We need to serve as many needy children as possible. I look forward 
very much to working with our colleagues on the Finance Committee to 
make that goal a reality as the reauthorization of the Temporary 
Assistance for Needy Families Block Grant moves forward this year.
  I commend Senators Enzi, Alexander, and Dodd for their impressive 
work on this bill. I urge all of my colleagues in the Senate to support 
this important legislation and work with us to provide the support for 
quality child care that low-income families throughout America need and 
deserve.
                                 ______