Lawmakers hear calls to make higher CACFP payments permanent for family childcare homes to ease rural provider strain
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Summary
Witnesses told the Health and Human Services Committee that the CACFP two‑tier reimbursement system penalizes in‑home family childcare providers in many rural areas and urged Congress to reimburse all family child‑care homes at the higher (tier 1) rate.
Senator Bob Holstrom introduced LR296, a legislative resolution urging Congress to change the Child and Adult Care Food Program (CACFP) so that all participating family child‑care homes are reimbursed at the higher tier‑1 rate regardless of census tract. Holstrom noted the temporary Keep Kids Fed Act waivers during the pandemic reimbursed family child‑care homes at tier 1 and argued making that change permanent would better support small providers.
Providers and sponsors testified in favor. Carrie Sullivan, executive director of Providers Network, explained how sponsors enroll and monitor family child‑care homes and noted that tier 2 providers receive roughly 52% less reimbursement for the same meals. "Providers are classified as tier 1 or tier 2 based on eligibility rules," she said, adding that many rural providers left the program when the pandemic-era universal tier 1 reimbursement expired.
Taylor Furness, a family childcare owner in Syracuse, gave a firsthand example: "My total reimbursement for that meal is 62¢," she said, adding that the difference between tier 1 and tier 2 for common meals can be more than a dollar per child per meal and that small providers often run near-zero margins. Speakers argued that the geographic tiering system can create nearby providers serving identical populations but receiving materially different reimbursements.
Supporters said LR296 is a formal request to Congress (a non-binding resolution) and would not itself change state or federal funding. Committee discussion touched on the potential federal fiscal impact of a permanent change and on differences between family childcare homes and center-based programs; sponsors said the resolution applies specifically to in‑home family providers.
Committee members did not take a vote on the resolution during this session; proponents asked the committee to adopt LR296 later in the session so the legislature can transmit a formal recommendation to Congress.
