Holcomb amendment to H.248 would shift private pre-K payments to child-care subsidy fund; lawmakers debate trade-offs

Rep. Anne Holcomb told the House Human Services Committee that her amendment to H.248 would keep public pre-K funding in the state's Education Fund while shifting payment for pre-kindergarten offered in private child-care settings to the state's child-care subsidy program. Holcomb said the change aims to reduce the pressure on the Education Fund and blunt property-tax increases.

"If this can change and bring down property taxes even by a bit, even as it doesn't really change the experience of families, why wouldn't we do that?" Holcomb said during her presentation.

Holcomb described the proposal as a funding-structure change rather than a regulatory change: school-based pre-K would remain the responsibility of school districts and the Education Fund, while families who enroll a child in private pre-K would have the state's child-care subsidy (CCFAP/CCFAP-like funding) pay tuition for that setting. She and committee members said the amendment does not alter regulatory standards or minimum quality requirements for early-childhood programs.

Why it matters: taxes, equity and capacity

Holcomb said the Education Fund spent about $14.3 million on pre-K tuition payments to private providers and that the child-care payroll tax and related programs had an available surplus in the prior year (she cited roughly $15 million). She argued the proposed shift could modestly reduce the average property tax rate and smooth parents' application burden by centralizing subsidy processing with DCF instead of requiring separate applications to districts and to DCF in some cases.

Lawmakers and staff raised several implementation questions. Several members asked whether the child-care subsidy program has the fiscal capacity to absorb private pre-K payments without new revenue, whether shifting the funding would change program access for families, how the change would affect rural districts and small providers, and whether it would create wage or equity disparities between educators in public versus private settings. Representative Doug Bishop and others noted that parents choose private programs for reasons including hours and continuity, and cautioned against unintentionally reducing options for working families who need extended-day or year-round care.

Workforce, equity and regulatory concerns

Committee members discussed unequal pay and benefits across public and private early-childhood settings — an issue Holcomb acknowledged and that committee members said has been the focus of recent reforms (including Act 166 and other efforts to raise reimbursement rates and professionalize the workforce). Members also noted declining child cohorts in some districts, which affects program scale and teacher pay. Holcomb said the amendment was not intended to mandate delivery in any single setting and that parents would still choose where to enroll their child.

Fiscal analysis and next steps

Several members asked the Joint Fiscal Office (JFO) to provide a detailed fiscal analysis before the measure proceeds. Holcomb noted the bill missed crossover this year and that JFO work should be complete before the Senate takes it up next session. Committee staff confirmed the amendment would proceed through the legislative process and be considered by other committees, including House Education, Ways and Means, and Appropriations, before final disposition.

No formal vote on the amendment occurred in the hearing. Committee members asked for more data on pupil counts, reimbursements and the existing child-care subsidy balance so the full fiscal impact can be assessed.

Background and context

Holcomb cited prior legislation and reforms — including Act 76 (earlier universal subsidy and pre-K implementation work) and Act 166 — as part of the context for the amendment. She and other speakers noted the mixed-delivery nature of early childhood services in Vermont, with both public-school and private providers delivering pre-K and with parents often choosing private settings for reasons of hours and convenience. The committee indicated it will request staff and JFO work to analyze the proposal's fiscal and programmatic effects before a final vote.