Child care funding decisions affect all of us, from the families who depend on it, to providers who nurture the next generation, to the children who learn and grow every day.
What is the May Revise?
Each year, the Governor releases a spending plan for the state in January, and then revises it in May, after the April tax revenues are collected.
April tax revenues are lower this year. This is partly because the federal government moved the tax deadline from April to October. Many people just haven’t paid their taxes yet. The Governor expects revenues to be lower than last year, too, due to the changing economy.
Governor Newsom released the May Revise on May 12, 2023. His total spending plan is $224B and reflects lower revenues – but it also protects the rainy day fund, and does not propose any new revenue sources to make up for the shortfall in corporate and personal income taxes.
For a detailed summary of expenditures, read our full analysis here.
What is in the May Revise for child care?
- Pause 20,000 new child care spaces originally slated for the 2023-24 Budget Year*
- Temporary stipends to child care workers in the amount of $281.2 million federal COVID-19 funds
- Continuation of the family child care fee waiver to September 30, 2023*
- $111 million to increase payments to families in CalWORKs
- No mention of increasing payment rates for child care providers, other than a reference to the negotiations with Child Care Providers United
- No mention of the alternative methodology to replace the Regional Market Rate Survey currently used to calculate child care payment rates
The Governor and the Legislature have already agreed, through a process called Early Action, to use federal pandemic relief funds for stipends, and to extend the family fee waiver till September 30, 2023.
* In 2021, the Legislature agreed to fund 200,000 spaces by 2025.
How does the Governor’s Plan compare to the Legislature’s?
Senators and Assembly members on the Budget Committees expressed their support for increasing child care payment rates, continuing the expansion of child care spaces, and an equitable family fee policy.
The Senate budget blueprint “Protect Our Progress” proposes $800 million in new funding for these items.
The Assembly proposed a “Care COLA” increasing child care funding by 25.44%.
What happens next?
Over the next month, the Legislature and the Governor must find agreement on spending on these child care items. The Budget must be finalized by June 15, 2023.
Conclusion
Affordable and enriching child care is the foundation for a child’s wellness. It helps families to work so they can work and provide for their housing, health care, and other needs.
Child care policy and budget decisions affect all of us. Families, providers, advocates agreed to this unified request this year:
- Comprehensive child care payment rate reform and increasing the amount child care providers get paid*
- Establishing an equitable child care fee schedule for families that is not based on discriminatory policies from the past
- Fulfilling the promise of 200,000 new child care spaces over three years by releasing final 20,000 spaces immediately
- Keep in place the child care health and safety protections for preschool programs for three year olds in public schools
- Allow licensed, community-based child care programs to run preschool and TK
*This may gain enough time for a new Executive Order by President Biden to become effective. On April 18, the President directed the Dept. of Health and Human Services to consider actions to reduce or eliminate families’ co-payment for child care. Read the full fact sheet here.
For a detailed summary of expenditures, read our full analysis here.
