CHARLESTON — Despite widespread discussions about potential tax breaks and rebates for child care services in West Virginia, there is a notable lack of action from Governor Jim Justice and human services officials on how to address an impending funding shortfall for child care subsidies.
The state is currently in limbo as it awaits a decision on whether approximately $23 million will be allocated to the Child Care Assistance program. This uncertainty is causing child care providers to close their doors as the September 1 deadline approaches.
Tammy Cole, Director of Owlet Childcare Center in Fairmont, expressed her concerns in an email. Her facility, which served over 30 children, shut down in June. “We’ve done everything we can to keep our doors open, but without continued support, we simply can’t sustain the rising costs,” Cole said. “It breaks my heart to know we can no longer be there for the children and families we serve.”
New federal regulations starting in September will require states to fund child care providers based on enrollment rather than attendance. Federal COVID-19 funding for child care stabilization ended in September 2023, leaving states like West Virginia to adapt. The American Rescue Plan Act had allocated $24 billion for child care stabilization, providing funds based on enrollment.
Currently, West Virginia reimburses child care providers based on attendance. The state’s Child Care Program, administered by the Bureau for Family Assistance, supports working parents or those attending public colleges by subsidizing child care costs based on income eligibility.
Past statements from the Department of Human Services (DoHS) indicate that the state will need an additional $23 million to adjust to the new enrollment-based formula. Without this funding, about 2,000 child care slots could disappear after September, according to the West Virginia Association for Young Children.
Tiffany Gale, executive director of the West Virginia Women’s Alliance and owner of Miss Tiffany’s Early Childhood Education House in Weirton, has led efforts to address this issue. Various groups, including the WVWA and the Association for Young Children, have submitted petitions, letters, and children’s drawings to the Governor’s Office, and have even funded billboards around the State Capitol to raise awareness.
Despite some discussions between advocates and state officials, there is still no clear plan from DoHS or the governor to secure the necessary funds to avoid the child care funding cliff.
“It’s honestly devastating and exhausting,” Gale said. “The governor specifically promised to address the child care issues, but nothing has been done.”
State officials and lawmakers were aware of the looming child care subsidy cliff for over a year. During the 2024 legislative session, several bills aimed to address the issue, including tax credits for child care operations and a pilot program for cost-sharing among the state, employers, and employees. However, these bills were never considered by the House Finance Committee.
House Minority Leader Pro Tempore Kayla Young, D-Kanawha, criticized the failure to address the issue earlier. “We knew about the rule during the session and could have fixed it then,” she said. “But due to budget concerns, it didn’t get done.”
Governor Justice and human services officials have the authority to address the shortfall without legislative approval. In May, lawmakers passed Senate Bill 1001, which restored funds to the Department of Health and DoHS, allowing for money transfers within these departments. However, Justice has not yet acted on this.
Justice has mentioned calling another special session in August or later to address surplus tax collections, personal income tax cuts, and a child and dependent care credit. However, it remains uncertain if this special session will occur.
House Speaker Roger Hanshaw, R-Clay, emphasized that the governor and DoHS do not need legislative approval to manage the funding issue. “There’s no need for fearmongering,” Hanshaw said. “DoHS has access to the funds and just needs to inform the Legislature.”
Despite this, DoHS officials have not addressed media inquiries. At a recent event in Charleston, Dr. Cynthia Persily, the cabinet secretary for DoHS, declined to comment, directing reporters to her communications director, who then asked for questions to be submitted via email. No responses were received by the deadline.
Governor Justice was vague about the funding issue during his weekly briefing. “We need to make sure it is being addressed properly,” he said. “We are working on it.”
Gale expressed frustration with the lack of clear action from the Governor’s Office. “The tax credits are not enough to solve the child care crisis,” she said. “We need to listen to those experiencing the problem.”
If the issues are not resolved, Gale warned that the state will face increased reliance on poverty programs as more child care centers close and parents lose their jobs.
The West Virginia Chamber of Commerce has highlighted the problem in a white paper, noting that child care capacity is insufficient in most counties. The paper reports that 46 out of 55 counties have a child care capacity of 49% or less for children under 5. In some areas, fewer than 100 licensed slots are available, and even when slots are open, staffing issues may prevent full utilization.
Bryan Dayton, the paper’s author, stated, “The lack of child care facilities is increasing, and workforce participation is decreasing. Families are choosing to have fewer children or moving out of state due to the high costs of child care.”
Hanshaw has assembled a House task force to explore ways to expand child care access, including easing regulations on child care facilities. However, he noted that the state does not plan to seek a waiver from federal rules, which could limit immediate options.
The West Virginia Chamber of Commerce supported Senate Bill 656 in 2022, which offered a 50% tax credit for starting new child care centers. House Bill 5052 sought to expand this credit to 100%. Although tax credits have been proposed, many believe they offer limited immediate relief.
Gale emphasized that addressing the child care crisis requires more than tax credits. “The problem won’t be solved by tax credits alone,” she said. “We need to take immediate action to prevent more centers from closing and support families and child care providers.”