Congress created the Child Care and Development Block Grant (CCDBG), as part of the 1990 Omnibus Bill, to increase access to child care for low-income parents who were working involved in some type of work related activity.

The CCDBG provided funds to states through block grants. The block grant required states to use 75% of their CCDBG funds for subsidies to families and 25% for early childhood development programs.  The bill had no state match funding requirements and had no other statutory requirements giving states significant flexibility to tailor their programs however they wanted to.  The initial funding was authroized at $2.5 Billion over a five year period. 1

Changes after 1990:

  • Then, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) appropriated new entitlement child care funds under section 418 of the Social Security Act and reauthorized discretionary funding under the 1990 Child Care and Development Block Grant Act.

  • Specifically, PRWORA required that child care funds be transferred to state/tribal Lead Agencies for the CCDBG and be administered by that agency.

  • PRWORA also consolidated three federal child care programs previously serving low-income families under the program formerly known as Aid to Families with Dependent Children. The Administration for Children and Families (ACF) named these combined funds the CCDF (Child Care and Development Fund).

Services are usually provided through subsides to parents:

  • Parents typically receive subsidies in the form of vouchers that they can use with a provider of their choice – such as a relative, neighbor, child care center, or after-school program.

  • Care providers who accept CCDF vouchers also receive monetary reimbursements from their State government to ensure that each subsidized child is receiving quality care.

  • Reimbursement rates are determined by the states (amount is part of state expenditure.)

For more information on state child care programs, see here.

For the full text of the bill, see here.

Endnotes

1. https://iff.org/wp-content/uploads/2017/05/century_of_caring.pdf