Kentucky has the most restrictive income guidelines and is one of only two states that has a freeze on applications for its child care assistance program for working parents, according to a new report released Wednesday.
The National Women's Law Center, a Washington D.C.-based nonprofit, released its annual report on states' child care assistance programs. The programs are designed to help poor parents pay for child care so they can work or go to school and stay off public assistance programs.
During the recession, states made cuts to child care assistance programs as the economy and tax revenues tanked. But the National Women's Law Center report shows many states are restoring cuts to the program.
Kentucky is the exception.
In April, state officials announced a freeze on new applications to the program and cut the eligibility requirements from 130 percent of the poverty level or $33,075 for a family of four to 100 percent of the poverty level or $22,050.
No other state has a lower income cut-off, said Karen Schulman, one of the authors of the National Women Law Center's report called "Pivot Point: State Child Care Assistance Polices for 2013."
"We are still seeing some cuts but Kentucky is a stand out in a negative way, because they have made such dramatic cuts," Schulman said.
The cuts are expected to save $57.8 million as the Cabinet for Health and Family Services tries to erase a projected $86.6 million shortfall.
According to the report, Kentucky also lags behind other states in the amount of money it pays providers in the program. Kentucky only pays 20 percent of the recommended federal reimbursement rate to child care centers. It also currently has a freeze or moratorium on new applications. Currently, Tennessee is the only other state with a moratorium.
Jill Midkiff, a spokeswoman for the Cabinet for Health and Family Services, said the report does not show other key factors in the child assistance program, such as how many children are served and the costs to parents. Kentucky has never raised its co-pays for parents in the program, Midkiff said.
Still, while Kentucky has cut, some states have expanded their child care assistance program, Schulman said. North Dakota, which is experiencing an economic boom and low unemployment, upped its reimbursements to child care providers and loosened income eligibility requirements so more parents could qualify.
Schulman said that as the economy has improved, states like North Dakota have seen the value of the program that keeps parents working and keeps children in a safe environment.
"This is good for our families, this is good for our economy," Schulman said.
Terry Brooks, president of Kentucky Youth Advocates, a Louisville nonprofit, said Wednesday's report shows that Kentucky continues to fall behind other states in the funding of child care programs. It's time state leaders reversed that trend, he said.
"The recent state child care assistance report makes the case even more clear that the Kentucky General Assembly must take action to restore funding to child care during the 2014 legislative session," Brooks said.
Midkiff said Wednesday that the cabinet could not say when the moratorium on new applications would be lifted. Kentucky continued to operate its low-income child care assistance program during the recent federal shutdown, unlike some states, she said.
"The cabinet regrets the level of reductions to CCAP; however, the cost containment measures are necessary to operate within the cabinet and department budget constraints," Midkiff said.
Community Action Council, which covers much of central Kentucky, had to close two child care centers since the cuts and freeze took effect in April. It currently has 12 child care centers. Ninety-one child care centers in Kentucky have closed since June 30, Midkiff said. It's not clear if all of those centers had closed because of the child care cuts.
"We're down to 164 kids from 248 children," said Malcolm Ratchford, executive director of the Community Action Council.
Ratchford said that the cuts will likely cost the state more than it will save. Ratchford said he knows several parents who have had to quit their low-paying jobs and go back on public assistance because they can't afford to work and pay for child care.
"The whole intent of child care assistance is to make it easier for people to work," Ratchford said."This does not help working people."