$7.5 million in child care grants added to draft Alaska House budget

JUNEAU — The House Finance Committee on Tuesday added $7.5 million in one-time child care funding to the draft operating budget.

Alaska’s beleaguered child care sector has long struggled with long waitlists, low wages and high tuition costs. The $7.5 million in grants is intended to subsidize providers’ operating expenses and to boost wages. According to a recent McKinley Group report, Alaska’s child care workers earn an average of $14.18 per hour.

The Alaska Early Childhood Advocacy Group requested $37.5 million be approved this year for early childhood education. The group said $15 million in child care grants was its “most critical” request.

The $7.5 million in child care funding matches a figure approved by the Legislature last year. Thread Alaska, a child care advocacy organization, was tasked with distributing those funds to as many providers as possible. The goal was to boost workers’ wages by $1 per hour.

Last year’s child care grants were a first for the state. Developing the grant program took months and providers have not yet gotten those funds. Advocates say that state funding will be well received, but the usefulness of one-time grants would be limited.

Similar to debates about public school funding, House members said putting child care funding permanently in the state’s budget would provide certainty and predictability for child care operators.

Rep. Alyse Galvin, an Anchorage independent, said providing $15 million in state child care grants each year would allow more Alaskans to enter the workforce. She said two child care centers closed in Dillingham and Ketchikan in recent weeks.

”We have heard from programs all over the state that this boost in funding is the difference between keeping their doors open and closing them,” she said.

Gov. Mike Dunleavy established a child care task force last April through an administrative order. The goal was to improve the affordability, availability and quality of child care in Alaska. The 11-member task force released its first set of recommendations to strengthen the sector in December. The final set of recommendations is due in July.

Nine task force members recommended in December that the state subsidize child care workers’ wages. Advocates said for the child care sector to thrive, substantial funding is needed from all levels of government.

Anchorage GOP Rep. Julie Coulombe, a member of the governor’s task force, proposed turning the permanent $15 million child care boost into a one-time $7.5 million increase.

“I think there’s a lot of issues when you as a business start relying on subsidized wages ... to help pay your people. I think there’s other ways to solve that problem,” she said.

Coulombe has sponsored child care legislation that passed the House in February on a 35-5 vote with strong bipartisan support. Her bill would give corporations tax credits to provide child care. It would also subsidize tuition costs for more children at a cost of roughly $5.7 million per year.

After a break in proceedings, members of the Democrat-dominated minority caucus supported the one-time $7.5 million in child care funding. Galvin said it would be “politically viable.”

Robert Barr, Juneau’s deputy city manager and a member of the governor’s child care task force, said extra one-time funding for the child care sector would be appreciated.

“What is key is that funding for this sector be consistent, year after year,” Barr said by text message. “Childcare operators need the ability to plan for the future like any other business and consistent funding is required for long term planning.”

Palmer Republican Rep. DeLena Johnson voted in support of the child care grants, but she said there needed to be more state oversight. Johnson successfully introduced an amendment for the state to write an annual report on child care providers, which would look at, in part, their quality of care.

“We’re letting people know that we’re paying attention,” she said.

During amendment debates, House members said each addition to the budget would inevitably see reductions to this year’s Permanent Fund dividend. The current dividend figure in the House Finance Committee’s draft budget is $2,272 per eligible recipient.

The child care grants were added to the latest version of the House’s operating budget on an 8-3 vote. Republican Reps. Frank Tomaszewski, Mike Cronk and Will Stapp voted no.

Operating budget amendment debates are expected to continue throughout the week in the House Finance Committee. The budget would then advance to the full House for its consideration.