FRANKFORT — The state will dramatically cut child care assistance to low income families and will pay no new subsidies to relatives raising abused or neglected children beginning in April, state officials announced Tuesday.
The cuts to two key programs come as the Cabinet for Health and Family Services is trying to fill a projected $86.6 million shortfall in the budget for the Department for Community Based Services, which oversees child and adult protection and other programs such as food stamps.
The cabinet has been able to plug $59.3 million in state cuts since 2009 with a combination of federal stimulus dollars, other federal money and general cost-saving measures. But the federal dollars used to offset those cuts have been depleted, said Cabinet for Health and Family Services Secretary Audrey Tayse Haynes. At the same time, the demand for services has increased, she said.
"This is really tough and these are not the kinds of decisions that we want to be making," Haynes said. "Any reductions in services impacts a child's life."
Terry Brooks, executive director of Kentucky Youth Advocates, said the cuts will have real consequences for families.
The number of grandparents, aunts and uncles taking care of children has exploded in recent years, Brooks said. "We also know that quality child care is not a luxury for working low income families — rather, it is an essential tool to boost their children's future outcomes in education and health. Now those — and other key supports — are diminished."
Beginning in April, there will be a moratorium on applications to the child care assistance program continuing until as late as June 2014. And, beginning in July, the income requirements for parents in the program will change from 150 percent of the poverty level — $33,075 for a family of four — to 100 percent of the poverty level — or $22,050 for a family of four.
The child care assistance program gives low-income families a stipend for child care. The program is designed to keep more low-income families working and off welfare and to expand access to early childhood education programs.
Parents who receive the child care assistance money because they are receiving Temporary Assistance to Needy Families money or are receiving other child protection services will continue to receive those child care assistance dollars, said Teresa James, commissioner of the Department of Community Based Services.
But the cabinet estimates that as many 8,700 families could lose child care assistance money when the new income guidelines take effect in July. An additional 2,900 children per month will likely not receive child care assistance because of the moratorium on new applications to the program beginning in April. The moratorium on new applicants will be in place until June 30, 2014, or until a savings of $38.4 million is met.
In total, the changes to the child care assistance program will result in a savings of about $57.8 million, the cabinet estimates.
But the cabinet warns that the cuts could result in more parents out of work because they can't afford child care. Currently 24,400 families and 48,000 children receive child care assistance money. The average subsidy is $376 per family, per month.
"I am very concerned that we are going to be taking working parents and make them unable to work because they are not able to find child care," James said.
James said she is also worried how those cuts will effect nearly 2,400 child care centers that receive child care assistance money. Even with the cuts, the child care assistance program will continue to serve about 28,000 children, cabinet officials say.
In addition to the cuts in the child care assistance program, the state will be forced to limit money going into a program that provides money for kinship care. In that program, relatives other than parents get a $300 monthly stipend to help raise a child who has been removed from home because of abuse or neglect.
Beginning in April, there will be a moratorium on any new kinship care money. But James said that many of those children will be eligible for other government programs such as Temporary Assistance to Needy Families or food stamps. Children in kinship care will also still be eligible for Medicaid.
The moratorium on kinship care benefits is projected to save $8.3 million. Those who currently receive a stipend will continue to do so until the child turns 18 or leaves the kinship care program for other reasons.
The moratorium on kinship care supplements after April 1 could result in fewer families caring for relatives and more children being placed in state-run foster care, which is more expensive than kinship care, advocates say.
"It is something that we will be monitoring closely," James said. "Families, more times than not, will rise to the occasion and will help take care of these kids."
While federal and state money has been cut over the past four years, the need — particularly for foster care and kinship care — has grown, Haynes said.
"With programs like these, you have very little control over the growth of the program," Haynes said.
Kinship care, for example, has increased by 38 percent since 2007, cabinet statistics show. More than 11,000 children were in the kinship care program in 2012, up from 8,685 in 2007.
Children removed from homes because of abuse and neglect also have much more complex behavioral problems and need more intensive services, which has also driven up costs, James said. In addition to the cuts to the kinship care and child care assistance program, the Department for Community Based Services will also have to come up with $20.5 million in cost savings through cuts to travel and other expenses, James said.
Haynes said that the state's poor fiscal health means that there is no additional money to offset the cuts.
"As I understand it, there are no plans from the legislature to re-open the budget for any reason," Haynes said. "We have to live within our means."
But Brooks said that it was time that the legislature put children and not key industries first.
"We as a commonwealth must muster the courage to ensure that our children have adequate resources," Brooks said. "We have more than a few "sacred cow" signature industries that seemingly always are protected in tight budget times. Maybe it is time to label "kids" a signature industry so our children have adequate supports today to build their tomorrows."
Rep. Jimmie Lee, D-Elizabethtown, chairs a key budget subcommittee that oversees the cabinet's budget. Lee, who was briefed on the cuts by the cabinet on Tuesday afternoon, said that he and others will look at ways to try to restore funding to these programs.
"It's going to be have a devastating effect on those folks that need that money to go back to work," Lee said. "If they don't have this money, they are not going to be able to find child care and will likely have to quit their jobs and stay home and take care of their kids, which means they will go back on welfare."