MDHS tells committee child-care vouchers dropped from 36,000 to 18,000 after ARPA funds expired; 20,000 families wait

The Department of Human Services told the committee it has restored part of its child-care voucher rolls but faces a sizable waiting list after ARPA funds expired.

Mister Anderson, the agency presenter, said the department used ARPA to fund child-care certificates and provider supports; when those funds were exhausted (he said ARPA awards totaled about $399,000,000), the program paused and the agency requested $45,000,000 from the legislature but received $15,000,000 in state general funds. With that appropriation and federal CCDF funds, MDHS currently serves roughly 18,000 children with certificates and has placed about 20,000 families on a waiting list.

"All of those ARPA funds were expended ... about April of last year," Anderson said. "At the time the ARPA funding expired, we were providing certificates to approximately 36,000 children in Mississippi." He said a certificate is a one-year voucher and many of the ARPA-funded supports (provider subsistence grants, substitute teacher pools and training) were intended to keep providers in business during the pandemic.

Chad Allgood, identified by Anderson as the Division Director for Early Childhood Care and Development, explained that effective Nov. 18 the agency reimplemented a redetermination process for families with expiring certificates; MDHS awards new certificate slots from the waiting list as families roll off the program.

Funding mechanics and TANF: Anderson said MDHS is converting 30% of its TANF state assistance grant (about $25,000,000) into CCDF child-care funding—an approach the agency said it may continue while federal rules allow such conversion. "We are converting 30% of our TANF state assistance grant, 30%, which amounts to $25,000,000, directly to the childcare development fund," he said. Anderson cautioned that federal rules limit conversion to a maximum of 30% of TANF to CCDF and that any direct TANF assistance would require families to meet TANF eligibility standards.

Anderson described other tools the agency is pursuing, including promoting a little-used child-care tax credit and offering technical assistance to employers interested in employer-run care; he said lowering the credit threshold (from about $6,000 toward $3,000) might improve employer uptake. He also described RFPs for TANF subgrants and said MDHS expects subgrantee programs to be operational in early February.

SNAP administrative costs and error-rate work: Anderson warned the committee that changes under HR 1 will raise state administrative obligations for SNAP. He said that, beginning Oct. 1, the federal share of SNAP administrative costs will drop so the state’s share increases; MDHS estimated an additional $15,000,000 in administrative funding would be required for the coming year and described three future error-rate tiers (5%, 10%, 15% cost shares) that could raise state costs further. Anderson said MDHS’s current SNAP error rate is about 10.49% and that, if that rate persisted into the federal window used to lock an error-rate baseline, Mississippi could face a larger state cost share.

To reduce error rates, Anderson said the agency is piloting three income/employment verification vendors and working with Westat and Code for America to identify root causes. "We are working on three pilot projects with three companies ... and we're also working with two other vendors called Westat and Code for America who are helping us get at the root cause," he said.

Questions and next steps: Committee members asked for clarifications on eligibility, timing and the mechanics of TANF conversion. Anderson said the department needs federal guidance to finalize any direct TANF assistance program and does not expect to be ready by Feb. 1; he urged careful implementation to avoid misallocation of TANF dollars. The committee took no formal vote on child-care funding in this session; the meeting adjourned after the presentation.