There were more than 10,000 kids in Arizona on a waitlist for assistance to pay for child care as of the end of November; that represents nearly 6,000 families. The numbers come from the state Department of Economic Security.
Arizona reinstated its waitlist last summer after federal pandemic money ran out. The state has put money into child care subsidies, as costs continue to rise, but it’s also lost an additional $24 million in federal funds.
The Show spoke about this earlier with Rebecca Gau, executive director of Stand for Children Arizona. She says the waitlist has implications both for the state and for families.
Full conversation
REBECCA GAU: For families, it means that they're often making the choices between having, you know, two working parents and the double income that is quite necessary sometimes or often with the rising prices today. So it means that they're having to make a decision for one of those earners to not work. Child care costs can take up to 17% of a family's budget or income, and that that's a lot.
And then we're seeing for younger people that they're simply choosing not to start their family or not to grow their family because they're seeing the cost of actually raising kids is, you know, higher than they can bear.
So there's that level which is certainly, you know, very concerning in terms of the state level that also translates into lower revenues. If you don't have folks earning an income and you don't have folks spending as much money, it reduces the amount of money coming to the state in taxes. It reduces the impact to the economy in general.
And some folks estimate that's about a $5 billion hit to the economy. And then there are also estimates coming out of the center for Future of Arizona that there could be a $12 billion impact to the economy.
So we're not just talking about the very real and very important impact on families in Arizonans. We're also talking about our impact overall to meet our budgetary obligations.
MARK BRODIE: Well, so the Legislature and governor this year put a not insignificant amount of money into child care, and yet the list is where it is. So why is that?
GAU: Federal cuts. It's short and simple. Originally, those of us who were working on this issue estimated that the state investment of $45 million on top of the federal investment would cut that wait list in half to what it was at the time, which was actually lower than this. And then all those federal cuts started happening and that completely wiped out the benefit.
It was fortunate we got the state money in ahead of time to supplement what the federal cuts were going to be. So the money that wasn't invested this summer, that was a combination of federal and state, then got slashed in the fall because of the federal changes.
BRODIE: Is there a sense of how much money the state would need to put into this program to overcome the federal cuts or to significantly bring the waitlist down?
GAU: Yes, it would cost about $165 million a year to eliminate the wait list. So we're talking about a not insignificant amount, but also much less than some other programs are costing the state. And also we recently conducted a survey of Arizonans who agree, like, we gave them options, which you would. What you would prefer, like current level, enough to cut the wait list in half and enough to eliminate the wait list entirely.
And we gave them the amounts, and the majority of Arizonans are for either increasing or completely reducing and over 35%. And it was a plurality, right. So the most respondents said, let's eliminate it completely.
BRODIE: Well, so as you say, you know, $165 million, you know, in real money is an awful lot of money, but, you know, when you look at it in the context of a many, many, many billion dollars state budget, you know, it's not a huge component of it.
At the same time, though, the governor has said that the state is not really in a position to make up for federal cuts in areas like SNAP and food.
Do you have any measure of optimism that the Legislature and governor will have that money, especially given, as you referenced earlier, where we are in terms of state finances?
GAU: Yeah. I mean, you never know.
BRODIE: OK.
GAU: I've been doing this long enough to know that where there's a will, there can be a way. The real trick here is, where the revenue's gonna come from? So there's some slight, small indications that we might be in a tough situation where there's slightly more money for one year than was anticipated. And I doubt it's going to be, you know, enough to cover the child care wait list.
So then you come into, OK, what are some other options? Well, raising revenue. That's a very, very difficult thing with this Legislature. The fact is that we are in a budget deficit, and the easiest way out of that is to ease off of the really significant tax cuts that were enacted a few years ago.
That is a very, very high lift that. That this Legislature is very, very, very unlikely to do. But I think it has to be a real solution that people are aware of, could be done, and the Legislature is choosing not to do it. There are other ways to think about it.
The governor had proposed in her last budget a public-private partnership between businesses and the state and parents. And this has been tried in a few other states with interesting results. Not quite I think what folks had hoped, but promising. And the idea is that an employer would cover a third of the child care costs, the state would cover a third, and then the parents would cover a third. I think it's definitely worth digging into how we could make it work in Arizona.
I do want to mention another potential solution that the state of New Mexico implemented recently and that is the their state land trust using their state trust land to fund childhood for everybody, regardless of their income. So that could be done as well.
BRODIE: I'm wondering where you think the number of families on the wait list goes from here. Like, do you think it will continue to go up? Do you think at some point it will go down? Like, what do you think?
GAU: It's definitely going to go up for a while. I mean, we've been watching it over the last few months. About 150 additional families a week have been getting have been being added to the wait list as we've been watching this fall.
So until something changes with inflation or, you know, state budget pressures or federal budget pressures, until any of those things change, it's going to continue to go up about 150 families a week.
BRODIE: How does that increase compared to what we have seen in the past? Like, have you, have you seen other times when 150 families join the waitlist in a given week? Like consistently?
GAU: No. I mean, this seems to be happening rather quickly. What we prefer to see is those numbers go down and there was a time in which they were at least flat or going down, but that hasn't been happening for the last six months at least.
