Wednesday, Dec. 17, 2003 | 11:02 a.m.
CARSON CITY -- Gov. Kenny Guinn's budget overestimated how much federal child-care money would be available, and the $18.2 million error has created a crisis for thousands of Nevada families, lawmakers were told Tuesday.
Assembly Majority Leader Barbara Buckley, D-Las Vegas, said the problem is "tremendous" and "a lot of families are suffering."
The number of children on the waiting list for state child-care subsidies swelled from 1,297 earlier this year to 6,341 in August and the crisis has only gotten worse since then, Willa Chaney, an operator of a child-care center in Las Vegas, told the Legislative Committee on Children, Youth and Families in Las Vegas.
State Welfare Division Administrator Nancy Ford said the division is restoring benefits for about 500 children a month because of savings from tightening the regulations. Some of those savings have come from eliminating other families' subsidies, however.
Buckley said Guinn is "weighing his options" and will make a recommendation to the Legislative Interim Finance Committee in January on a long-term plan for fixing the child-care subsidy shortfall. Greg Bortolin, Guinn's press secretary, said the governor has directed his administrative staff to look for revenue sources, such as savings in the Temporary Assistance of Needy Families program.
Bortolin said the staff is putting together a list of options.
Chaney said there was an estimated $10 million in savings in other welfare programs that could be shifted to fund child-care services. For instance, she said, there was a $4 million surplus in the programs Temporary Assistant for Needy Families and New Employees of Nevada, which requires welfare recipients to work.
In the meantime, however, the cutbacks in child-care subsidies are having a "negative impact on the working mother" and could swell the welfare rolls, Chaney said.
A mother of three who earns $350 a week, for example, has to pay $150 for child care, Chaney said.
"If she doesn't get help, she will go back on welfare," Chaney said.
The problem stems from a mistake in Guinn's budget. A legislative fiscal analyst report said Guinn's budget overstated the availability of federal child-care funds by about $9.1 million in each of the fiscal years in the present biennium.
The welfare division is now providing subsidies for about 6,800 children. The budget for the division is $33 million, with $24 million coming from the federal government and the rest from the state, Ford said.
The welfare division is obligated to provide child-care subsidies to women on welfare enrolled in work programs and to former welfare families for six months after they leave public assistance.
To stay within its budget, the division stopped paying subsidies to "at risk" families -- families who might go on welfare if they did not get the payment. And it stopped "discretionary" payments to those who had incomes above the welfare level.
In addition, the division in October ended subsidies to families who were paying 55 percent or more out of their own pockets to get child care. That caused the most controversy, Ford said. But, she added, the money saved with that change was shifted to help the most needy families.
The tighter regulations resulted in savings, Ford said. So the division is now enrolling children from "at risk" families at a clip of about 500 a month. There are about 325 children in Clark County who are qualifying each month for child-care payments and 175 in Northern Nevada.
She hopes to have the waiting list of 2,900 children in this category whittled down by July.
And if savings keep coming in, she said she would address the waiting list of 3,900 children in those families with "discretionary income." Ford said that to save money the state also stopped providing child-care subsidies to people who work out of their homes and parents who have someone such as a boyfriend or a grandparent living with them as well as parents who are not working, training or getting education.
Ford said she has considered shifting money from other welfare programs in to the child care coffers but is "concerned that creates an ongoing liability into the future." She said she wants to see how much savings are generated to remedy the problem before shifting money.
"If we need to move money, it's an option" she said.
Buckley said shifting money creates a problem there may not be enough money in 2005 to continue funding the program. But she added, 'It makes sense to help people so they can work."
The legislative committee also heard a plea from Jane Horner, representing grandparents who take care of their grandchildren. A program called Kinship provides them with child-care subsidies but it was reduced a year ago to allow the welfare division to keep within its budget.
Ford said the division reduced the benefits a year ago in the Kinship program and the Legislature did not provide money to restore the grant.
Ford said she installed an income threshold for Kinship participants' qualification for for grants. Those whose income is up to 235 percent of the poverty level qualify. She that that equates to a family of four that makes $4,216 a month or less.
She also reduced the amount of money each family could receive. The grant originally provided 90 percent of the foster care rate to the family for all children. It was reduced to 90 percent of the foster care rate for the first child and $100 a month for each extra child.
Horner, of Las Vegas, said grandparents are considering becoming foster parents so they can receive a full subsidy.
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