California's 2021-22 Budget: Historical Investments but Many Concerns Still Exist
Without question, the last 18 months have been a roller coaster.
The economic outcomes we are all experiencing now are quite unexpected. Whether it is sustainable or not is for another column. Huge influxes of monies continue to flow from Washington. California is poised to fully enact a 2021-22 General Fund (GF) budget of $196 billion which is over the revised 2020-21 (GF) budget of $166 billion. Aside from the above, $25 billion is put aside for reserves and uncertainties.
Last Thursday, millions of California families began receiving their federal 2021 Child Care Tax Credits which for most families means they automatically will receive monthly payments of $250 or $300 per child without having to take action. Earlier in the year, hundreds of thousands of families received a $600 Golden State Stimulus. And moving forward, families with dependents may also be eligible for an additional $500 benefit.
In reflection of all of the monies above and taking into account enacted and pending 2021-22 budget actions whose outcomes will impact California’s child care system and the critical need of working families to access of child care, my enthusiasm is tempered.
So, let’s start out by saying that the huge infusion of monies allocated to child care and early learning is historical and unprecedented. That simply cannot be ignored. Roughly 200,000 new child care slots phased in over several years, rate increases and rate reform that will benefit all child care providers throughout the state, a year of family fees waived for the most fragile of families, stipends for providers to help support them with new costs associated with operating in a post-COVID world, and the establishment of a universal transitional kindergarten to by phased in by 2025-26. Simply, WOW!
Now here is where I need to temper my enthusiasm. Little thought has been given to how implementation of the above is to happen, time limits of some of the policies, unstudied impacts on private markets, families and businesses due to shifting of services to the public-school system, and a new collective bargaining agreement with Child Care Providers United (CCPU).
In regards to the adding of over 145,000 child care slots beginning January 1, 2022 and expected to grow to 200,000 by 2025-26, no thought or funding is provided for community-based nonprofits to support the poorest of working families accessing new slots. The poorest of families in CalWORKs and in subsidized child care programs will need to again pay family fees beginning July 1, 2023 even though California received federal dollars for two full years to waive them. Child care centers that for decades have supported the real needs of working families by supporting them in hours outside of “part and full-time school hours” now are poised to shutter their doors as the four-year old’s that last year they supported will now be publicly supported to go elsewhere. Finally, the agreement with CCPU has a shelf-life of July 1, 2023.
In reflection of all of the above, my concern of throwing monies at issues without a clearer longer-term strategy, are that families are going to get hurt. The 2021-22 budget took safety-net monies out of the state General Fund (GF) earmarked to fund subsidized child care from birth-12 for our lowest incomed families and moved them to Proposition 98 for the schools. The process the CCPU engaged with the governor produced “historical” infusions of monies, but pennies on the dollar compared to the overfunding of other segments of the economy including public schools, correctional officers and over 200 new programs.
I truly pray that my concerns prove to be unfounded when the next recession hits. My hope is to begin honest hard conversations now focused on protecting fragile families when the economic downturn happens.