Last winter was a chaotic time for Katie Rivera. The mother of two young girls had just separated from her husband. She had also traded nights working as a bartender for a new career path in vision care that involved day shifts. And she had no child support to rely on.

So the Baltimore-area resident joined a wait list for Maryland’s child care subsidy program and, through that, found a new source of stability in her life. The subsidy helped pay for the girls to be in summer camp, and this school year the subsidy defrays about $450 of the $550 cost of a before-school and after-school child care program for both girls, aged 7 and 9.

“It allows me to be able to have a more regular schedule,” said Rivera, who earned a promotion to optician from her duties as a scheduler. “Especially with all the changes that happened in the last year, it really lets me be there for them.”  She earns $14 an hour at her 8-to-5 job, and said there’s no way she could pay for that level of child care on her own.  

On Monday, the U.S. House of Representatives passed the Child Care and Development Block Grant (CCDBG) Act of 2014, a measure to reauthorize the single largest source of federal funding for child care assistance that helps low-income, working families. The bill – which is expected to be signed into law by year's end – contains crucial revisions to the program that hasn’t been updated since 1996. It establishes new health and safety requirements for child care providers, such as annual inspections. The bill also aims to improve the quality of child care, as well as families’ access to care -- for example, by encouraging states to maintain subsidies for at least three months when a parent loses a job.     

Yet all those improvements will cost money at a time when state and federal spending on child care assistance has been shrinking, and fewer children have access to CCDBG support now than in 1999. In order to enroll more parents like Rivera, advocates say that federal and state lawmakers will have to dig deeper to come up with funding for the improvements -- without sacrificing coveted slots for families.  

“There have to be the resources that help them get the child care assistance they need,” said Helen Blank, director of child care and early learning at the National Women’s Law Center. “The bill sets the table, but it doesn’t authorize sufficient funds, given the other requirements in the bill.”

Total state and federal spending on child care assistance dropped from $12.9 billion in 2011, to $11.4 billion in 2012 (the year for which data is most recently available) – the lowest spending level in a decade. That’s according to an analysis by the Center for Law and Social Policy, which examined the mix of child care spending that comes from state and federal CCDBG funds ($8.6 billion), as well as the Temporary Assistance for Needy Families program ($1.2 billion on the federal side, and $1.6 billion from states).

The center also documented the sharp decline in the number of children served just by CCDBG funds. In 2012, approximately 1.5 million children per month were supported by those subsidies – a decrease of 263,000 children from 2006, and the lowest number on record since 1998.    

“Funding hasn’t caught up with the need,” said Hannah Matthews, director of child care and early education at the Center for Law and Social Policy. Nationwide, only one in six children who is eligible for child care assistance receives it, she said.

In a majority of states  --33 -- CCDBG funds served fewer children in 2012 than in 2011. And in states such as North Dakota, Nevada, Oregon and Georgia, that decrease was particularly large, according to the center.

Advocates worry about not only the number of children who can actually enroll in care, but also the reimbursement rate paid to providers. Those rates can limit a family’s choices when it comes to selecting a provider, and also affect the quality of care available. 

“Rates are extremely low,” said Matthews, a factor she described as "significant." 

For example, federal regulations recommend that states reimburse child care providers at the 75th percentile of current market rates. But that’s not a requirement. In 2013, “only three states had reimbursement rates at the federally recommended level for providers who serve families receiving child care assistance,” according to the National Women’s Law Center.

By contrast, in 2001 “over two-fifths of the states set their reimbursement rates at this level,” the same report found.

“You need those rates to go up to get providers to want to serve poor children,” Blank said.

As lawmakers begin to consider the changes in the CCDBG improvement bill, Matthews said she hopes they also consider new rounds of investments, “so we’re not making the trade-off between making these really important improvements to the program, and the number of children who are served.”