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Briefing covers child‑care subsidies, federal CCAP rule changes and workforce supports
Summary
Staff briefed members on the Child Care Assistance Program (CCAP), recent federal rule changes that will affect family copay caps and provider payments, Early Learning Scholarships, and state workforce initiatives including the Great Start compensation payments and retention bonuses.
House Research and House Fiscal staff described the state’s child‑care subsidy programs and workforce supports to the committee, and outlined impending federal CCAP rule changes that will require state implementation.
"There are two subsidy programs in the state: CCAP and Early Learning Scholarships," a nonpartisan presenter said, reviewing eligibility criteria and program statistics.
Why it matters: Subsidies and workforce supports determine affordability for families and viability for providers. Federal rule changes and statutory funding levels will shape how counties and providers operate and whether providers can remain financially solvent.
Staff summarized CCAP as a federal‑state program that subsidizes child‑care costs for low‑income families; parents must work or participate in education or training, and household income limits are tied to a percentage of state median income. Staff cited fiscal‑year 2024 program statistics: roughly 12,000 families were enrolled monthly (about 24,000 children total), average monthly payments per family were about $2,000, and total CCAP spending (federal, state and county) was about $306 million.
Staff said federal rule changes issued in March require states to cap family copayments at 7% of family income (Minnesota’s co‑payments previously could reach 14% of income), require advance or beginning‑of‑service payments to providers rather than retroactive payments, and require use of grants and contracts to pay providers for priority populations (infants and toddlers, children with disabilities and children in underserved areas). Staff noted states have two years to comply with the new federal rules and that the governor’s budget includes related recommendations.
The briefing also covered Early Learning Scholarships (a state‑funded program, previously administered by MDE) with Pathway 1 scholarships paid to families and Pathway 2 scholarships paid to programs to create seats for eligible children. Staff noted substantial recent state funding increases to the scholarship program following 2023 legislative changes.
On workforce programs, staff reviewed the Great Start Compensation Support Payment Program that provides monthly payments to programs to increase compensation and benefits; the per‑FTE amount was $375 through June 2026 and staff reported approximately $141.8 million in payments in the program’s first year. Staff also described retention bonuses, TEACH scholarships for college credit, apprenticeship grants and family‑friend‑and‑neighbor grants.
Members asked about program integrity and a recent fraud case; staff said they would ask DCYF/DHS for details about whether an organization implicated in a local fraud case received scholarship payments. The committee did not take formal votes at this orientation session.
