State Says Care 4 Kids Changes End 'Benefits Cliff' | Connecticut Public Radio

State Says Care 4 Kids Changes End 'Benefits Cliff'

Feb 3, 2020

The Lamont administration says working families across the state with low to moderate incomes are beginning to see the impact of a $14 million federal investment in their child care needs. Care 4 Kids, a state and federally funded subsidy program, is using the federal money to increase how much families receive as reimbursement for infant and toddler care.

Families told the state’s Office of Early Childhood that they were experiencing what’s known as a “benefits cliff.” Making more money meant they’d be disqualified from the child care benefits that they desperately need because of income regulations.

Jessica Soba found herself in a tough spot after a promotion. Last year, the single mother went from making around $37,000 a year to $50,000. That raise seemed like a good thing, but it also meant that the cost of child care for her young daughter would go from $241 per month to $1,600.

“We feel like we’re in a box,” Soba said during a news conference at Action for Bridgeport Community Development Inc. on Monday. “We can’t do better because if we do better, we get more money. If you get a bonus, if you get a raise, and then you fall out, then you get all your benefits taken away, and that to me is really a struggle.”

Beth Bye, commissioner of the Office of Early Childhood, said she worked with Melissa McCaw, the secretary of the Office of Policy and Management, in October to create a “graduated phase out” policy.

“What we’re doing here at the state level is trying to expand access, make this more possible for more families,” said Gov. Ned Lamont, "and make sure that as you go up and you keep working, you’re not disqualified or you don’t have to pay so much that it doesn’t make sense.”

According to Bye, prior to the changes, a family would lose all of its Care 4 Kids benefits “in one fell swoop,” as soon as earnings exceeded 50% of the state’s median income for its family size.

“If this hadn’t happened, her child care would’ve been $1,600 a month on a $50,000 salary,” Bye said of Soba. “That would’ve been nearly 40% of her total income in one day because she did well and persisted in the workforce.”

Because of the graduated system, Soba pays only a slight increase, bringing her child care bill to $344 per month. Bye said Soba’s child care costs won’t increase again until she makes above 65% of the state median income for a family size of two, which would be $51,241, based on 2019-20 figures from the Connecticut Department of Social Services.

“Her costs will go up slightly, but she won’t face this cliff that drives her right out of the workforce,” Bye said.

The inability to afford adequate child care can drive some families out of the workforce, into debt, or put pressure on them to put their children into day cares that could be unlicensed.

“I’m able to go to work, do what I have to do and have my child get taken care of,” Soba said through tears, “and she’s in really good hands. If it wasn’t for Care 4 Kids, I would literally be having to pay everything completely by myself -- that’s a lot more than my salary.”

“Too often we hear of programs like Care 4 Kids, like Head Start, as social entitlement programs -- they’re not,” said state Rep. Steve Stafstrom. “They’re economic development programs. It allows us to get folks into the workforce.”

Despite the federal dollars, Bye said there’s still a 50,000-seat shortage for infant and toddler care that they’re working to address.