8-Color
8 Elbert County News
June 27, 2013
Child-care aid coming up short Funding model puts many in bind By Burt Hubbard I-News
The measures passed by Congress and signed by President Bill Clinton in 1996 “to end welfare as we know it” were heralded as a ticket to economic selfsufficiency. The poor would be encouraged to enter the workforce and eventually leave all welfare assistance behind.
But for most of the tens of thousands of working poor families in Colorado, the vision of self-sufficiency is illusive. One of the most significant components of the work support programs — child-care assistance — doesn’t reach about threefourths of the state’s working poor and generally fails the other fourth’s attempt to escape poverty, according to an I-News analysis of state data, census figures and Colorado-specific research reports, as well as
Income lImIts by county Income eligibility limits for Colorado Child Care Assistance in communities covered by Colorado Community Media: Adams County Eligibility ceiling: 225 percent of poverty or about $44,000 for a family of three. College students eligible: Yes Number of children served in 2012: 3,545 Arapahoe County Eligibility ceiling: 185 percent of poverty or about $36,000 for a family of three. College students eligible: Yes Number of children served in 2012: 2,855 Denver County Eligibility ceiling: 225 percent of poverty or about $44,000 for a family of three. College students eligible: Yes Number of children served in 2012: 5,028 Douglas County Eligibility ceiling: 200 percent of poverty or about $39,100 for a family of three. College students eligible: Yes Number of children served in 2012: 632 El Paso County Eligibility ceiling: 150 percent of poverty or about $29,300 for a family of three. College students eligible: Yes Number of children served in 2012: 4,634 Jefferson County Eligibility ceiling: 185 percent of poverty or about $36,000 for a family of three. College students eligible: Yes Number of children served in 2012: 2,843 Teller County Eligibility ceiling: 150 percent of poverty or about $29,300 for a family of three. College students eligible: Yes Number of children served in 2012: 97
interviews with benefit recipients, policy experts and government officials. The I-News inquiry found: Working families can fall prey to the “cliff effect,” in which even a modest rise in family income can lead to termination of a government benefit, including subsidized child care, worth thousands of dollars a year. The family can suffer a big net loss by earning more. Colorado is the only state that allows counties to set income levels for eligibility for child-care assistance, or CCAP, the biggest work support program. The state’s system has created broad inequities in what families can earn before losing child care. Most experts say higher education is essential to rising out of poverty. Yet, 11 counties don’t give childcare help to parents attending college. A parent in Boulder County can get child-care subsidies to attend the University of Colorado, but a Larimer County parent gets no help to attend Colorado State University. Families facing the cliff effect report having employed strategies such as turning down raises, promotions or passing on better jobs to avoid losing an essential benefit. Proposed reforms center on phasing out payments gradually as family incomes rise toward self-sufficiency. Yet, when Colorado lawmakers twice tried to require counties to phase out child-care benefits, the pro-
Income eligibility limits by county for Colorado Child Care Assistance Sedgwick Jackson
Moffat
Logan
Larimer
Phillips
Weld
Routt
Morgan Grand
Rio Blanco Eagle
Garfield
Pitkin
Boulder
Summit
Broomfield Gilpin Denver Clear Creek Jefferson
Gunnison
Kit Carson Lincoln
Teller
Delta
Cheyenne
El Paso
Chaffee Fremont
Montrose Ouray San Juan
La Plata
Custer
Saguache
Hinsdale
San Miguel
Montezuma
Elbert
Park
Mesa
Dolores
Arapahoe
Douglas
Lake
Kiowa
Crowley
Pueblo
Bent
Otero Mineral
Archuleta
Rio Grande
Alamosa
Conejos
Yuma
Washington
Adams
Prowers
Huerfano Las Animas
Costilla
Baca
Source: I-News analysis of data from the Colorado Department of Human Services
Colorado's system of empowering each county to set income eligibility limits for child care benefits is unique. As this map indicates, there are broad inequities even among neighboring counties.
Income eligibility limits by county to receive Colorado Child Care Assistance. Income level is for a family of three -- one adult and two children. Legend $25,400 to $27,300 $28,300 to $31,200 $33,200 to $34,200 $35,200 to $39,100 $43,900
ROCKY MOUNTAIN PBS
The Rocky Mountain Investigative News Network
posals were watered down after lobbying by Colorado counties to make them voluntary. There are more than 63,000 working families in Colorado earning 130 percent of poverty-level income or less, about $25,000 per year, according to the I-News analysis. In 2012, according to state figures, CCAP served about 31,000 of the almost 137,000 children in those families — “a pittance,” in the words of one state senator. “The reason the cliff effect matters, and the reason it matters to all of us in society, is that we want to provide the opportunity for these families to get into the workforce, to stay working, to reach self-sufficiency, to get ahead,” said Rich Jones, director of research at Bell Policy Center in Denver, a self-described progressive think tank. “That’s the whole design. By keeping the cliff effect, by keeping the barriers in place, we’re actually providing a disincentive to continue working.” For many poor working families who receive work supports, the cliff effect isn’t an issue. They don’t earn enough to trip the loss of benefits. The real threat of the cliff effect is to those close to self-sufficiency. “A fraction of these folks can actually make it work,” said Susan Roll, a California professor who did her doctoral thesis at the University of Denver on the cliff effect. “It is very difficult to be on these programs and it is certainly next to impossible to escape the programs.” The work support benefits can include child-care assistance, food stamps, housing assistance, assistance with energy bills and Medicaid, among others. The steepest cliff in the state is posed by the childcare assistance program, experts say. Even a raise of $1 hour per hour, which would translate into roughly $2,000 a year for a full-time employee, could trigger the termination of the benefit worth $6,000 or $8,000 per year or more to the family, and might even impact the parent’s ability to work.
“I would say the cliff effect is the No. 1 reason preventing women and their families from achieving self-sufficiency,” said Lorena Garcia, executive director of Denver-based COLOR, which works with young women trying to escape poverty. Academic researchers and county social workers all said they have seen families forgo raises or promotions so they didn’t lose child-care benefits. “It’s frustrating to hear their stories,” said Tamara Schmidt, supervisor of the child-care assistance program in Larimer County. “To have them calling in tears because they’re over income by 10 cents (an hour). I mean, there’s really not a whole lot of wiggle room.” Self-sufficiency is pegged by most studies at about 225 percent of the federal poverty guideline, or about $44,000 annually for a family of three. That number comes particularly into play in Colorado’s county system for setting income limits for child-care assistance. The limit for a family of three ranges from $25,000, or 130 percent of poverty, to $44,000, 225 percent of poverty. And these vast disparities exist next door to each other. For example, in southeastern Colorado, Prowers County cuts off child care at $25,000 for a three-person family, while adjacent Bent and Kiowa counties allow up to $44,000. A 2008 state audit found that more than 1,000 families denied childcare assistance because their incomes were too high would have qualified in a neighboring county. Higher education is another touchstone in the debate over Colorado’s county system. “Post-secondary education, especially for single-parent households, is critical as far as financial security, social mobility, all of those things,” said state Sen. John Kefalas, D-Fort Collins. That Larimer County doesn’t allow higher education as an eligible activity ultimately comes down to
a matter of resources, officials said. “We had to make the choice to serve the poorest of the poor,” said Laura Sartor of Larimer County Human Services. “It was very difficult. It was a very hard choice to make. We did a lot of research and a lot of statistics in determining who we could and couldn’t serve. And unfortunately the student population was one of the populations that were an option, so we had to eliminate them and not be able to cover child care anymore.” Many counties change eligibility levels as budgets and caseloads rise and fall. El Paso County Commissioner Sallie Clark, a Republican, said it’s critical that these decisions be made at the close-to-the-ground county level. El Paso recently raised its level to 150 percent of poverty, but allows recipients, once approved, to stay with the program up to 165 percent. Colorado Counties Inc., the lobbying organization for the state’s 64 counties, has twice lobbied against legislation requiring the counties to phase out childcare assistance to counter the cliff effect. Each time, the counties lobbied successfully to make the proposals voluntary. The 2012 bill called for a 10-county pilot project to test phasing out the benefit. So, far no county has volunteered. Clark said requiring counties to phase out the benefit would be too costly. But Kefalas, the Fort Collins Democrat, said there would be benefits in embracing reform. “In my opinion, if we make these investments up front, we’re going to save an awful lot of money for the taxpayer in terms of public assistance programs, in terms of dealing with the criminal justice system,and the research bears that out,” he said. I-News is the public service journalism arm of Rocky Mountain PBS. For more information: inewsnetwork.org. Contact Burt Hubbard at bhubbard@ inewsnetwork.org or 303446-4931.