To address a looming child care crisis as federal pandemic assistance money dries up, a Utah lawmaker is proposing an “outside of the box” solution.

It’s one child care advocates welcome — while frustrated that Utah’s Republican legislators are more inclined to use about $160 million already-set-aside dollars for tax cuts rather than help child care providers.

Senate Minority Leader Luz Escamilla said Utah is expected to lose an estimated $400 million in federal funds for child care services after COVID-19 federal subsidies end. She calls it a fiscal cliff that’s jeopardizing access to already limited affordable day care options for working Utahns.

“The cliff is real,” she said of the $400 million in expiring federal dollars. “That’s a huge gap.”

However, knowing her counterparts at the helm of the Utah Legislature’s GOP-supermajority will likely be reluctant to budget enough money to make up for that shortfall, she knew she’d have to find another approach that wouldn’t require nearly as much money.

Stock image | Photo by romrodinka/iStock/Getty Images Plus, St. George News

“When I knew there was not going to be a lot of funds and I was told funding for directly funding child care may not be available, I was looking outside going, ‘What do I do now?’” Escamilla told Utah News Dispatch on Thursday. “I just wanted to think, ‘How can we do something outside the box that at least utilizes what we have?’”

So Escamilla has filed SB 176, a bill to take empty space in state-owned office buildings and retrofit them for child care facilities for state employees and other Utahns. She’s proposing it as a pilot project starting with six sites in Salt Lake County.

Her bill would also include options for public-private partnerships, in which employers could sponsor facilities for their employees, but only up to 60% of the child care spots. At least 40% would need to be reserved on a first-come, first-serve basis for other community members.

Escamilla said her bill could help provide child care spots for “hundreds of kiddos.” Though she acknowledged it won’t solve Utah’s child care crisis entirely, she expects its cost to come at a much lower price tag than $400 million the state is about to lose.

She seems to have political support for the bill — it’s been prioritized by the Governor’s Unified Economic Opportunity Commission — but the question is how much funding she’ll be able to secure.

Gov. Spencer Cox included Escamilla’s proposal in his budget recommendation to the tune of $5 million, but it remains to be seen whether lawmakers take that recommendation.

In this file photo, Utah Gov. Spencer Cox speaks during the 28th Annual What’s Up Down South Economic Conference at the Dixie Center, St. George, Utah, Jan. 11, 2024 | Photo by Chris Reed, St. George News

Legislative fiscal analysts are still working on her bill’s fiscal note, but Escamilla said if lawmakers were to fund everything she wants for the proposal, it would likely cost “more than $5 million, for sure.”

“(It’s) not the solution for all, clearly, but I think this highlights (that) we can do something with what we have and try to find other solutions,” she said.

Child care crisis

A group of 35 Utah business leaders and organizations on Wednesday penned a letter urging the Utah Legislature to address the state’s child care crisis.

“Approximately 77% of Utahns live in a childcare desert, demonstrating that the majority of our state lacks sufficient licensed child care to meet families’ needs,” the letter states, citing a recent analysis by the advocacy nonprofit Voices for Utah Children.

It also said Utah’s economy loses $1.36 billion a year due to lack of child care access, according to the U.S. Chamber of Commerce.

Nationally, now that COVID-19 pandemic aid dollars have expired as of Sept. 30, more than 3 million children are expected to lose child care and about 70,000 child care programs are likely to close, according to the progressive think tank Century Foundation.

Late last year, President Joe Biden requested $16 billion to stabilize the nation’s child care industry. Congress has not granted the request.

Cut taxes or fund child care?

Legislative leaders at the helm of Utah’s Senate GOP majority told reporters Thursday they likely won’t find money within Utah’s budget, projected to be more than $29.5 billion this year, to make up for the $400 million child care shortfall.

“I don’t think we can,” said Senate Majority Whip Ann Millner, R-Ogden. She looked to Executive Appropriations Chairman Sen. Jerry Stevenson, one of the most powerful lawmakers leading budget decisions, and she joked he “might have heart failure” if he had to find such revenue.

“We don’t really have that kind of money,” Millner said. Legislative leaders have said they’re working with a limited amount of new revenue this year compared to past years because of the cooling economy and the end of federal stimulus money.

“What I think we have to do is think about what we can do,” Millner said, pointing to Escamilla’s bill. She also said she’s thought about providing some sort of tax credit “that would allow companies to be able to put child care” in their own buildings. “Because that’s what parents really want. They want child care that’s close to them.”

However, it’s past the deadline to file a bill to tackle such a tax credit, so that’s likely not going to be tackled by lawmakers this year.

“This is not just about paying for child care,” Miller said. “It’s about the supply. … We do not have enough. We’ve got to do something that would help leverage that.”

Meanwhile, even before the session started Republican legislative leaders set aside $160 million for some type of tax cut, and all along they’ve said they’d prefer another income tax cut.

A bill to reduce Utah’s income tax rate from 4.65% to 4.55% is making its way through the Legislature. The full Senate approved that bill, SB69, on a party line, 23-6 vote Wednesday with Democrats voting against. It now goes to the House for consideration.

This file photo shows the Utah State Capitol, Salt Lake City, Utah, Jan. 17, 2020 | Associated Press file photo by Rick Bowmer, St. George News

Asked if Utah lawmakers would be able to find more money to fund child care issues if they choose not to cut income taxes again this year, Senate President Adams, R-Layton, laughed and said, “Oh, my heart.”

“You know, I suppose that’s a matter of priority, so we have to look at it,” Adams said. “But in the past we’ve been able to do both. We’ve been able to fund education, child care … we plan to continue to do all of the above like we have in the past.”

Asked if there will be enough money to do both — to cut taxes and fund increasing the supply of child care — Stevenson told reporters the money for a tax cut is already set aside, so “the answer to your question is probably not.” However, he said, rather than “take a plunge into a big project,” he said perhaps lawmakers could ease into it.

It’s possible lawmakers will choose to fund some — not all — of Escamilla’s proposal.

Senate Majority Leader Evan Vickers said lawmakers are facing no shortage of budget requests and suggestions of how else to spend the money.

“I’ve heard about five different suggestions on how to spend money if we chose not to do tax cuts,” he said. “I think it’s already been spent about five times.”

Stevenson said lawmakers are working through their process to prioritize all the funding requests. “The list is endless,” Adams said, “and we just need to be prudent.”

Adams and other Republican legislative leaders are eager to cut taxes again — for the fourth year in a row — arguing it will put money back in Utahns’ pockets, stimulate the economy and make Utah a competitive state. They’re also supportive of eventually doing away with Utah’s income tax entirely — though that would require major tax reform and is likely a discussion for another year.

House and Senate Democrats have been vocally opposed to cutting Utah’s income tax again, arguing the state should use that $160 million in ongoing funds for other much-needed priorities, including child care.

“Those millions should be used to help families,” Escamilla said, noting an income tax cut would likely largely benefit high-income earners. Families with the “biggest needs,” she said, likely won’t notice much of a tax break in the form of an income tax cut.

Meanwhile, “this child care crisis” is impacting “everyone,” Escamilla said, but especially working-class and upper-middle-class Utahns. She said some people are getting on child care wait lists before they even get pregnant. “It’s that bad.”

“For Utah, we want to be the family-friendly state,” Escamilla said. “We should be providing places for families to thrive, be healthy, have their babies, get to work and succeed.”

Child care needs help now, advocate says

Anna Thomas, policy director at Voices for Utah Children, expressed frustration Thursday in an interview with Utah News Dispatch that legislative leaders are dead set on cutting taxes while child care providers and working Utah parents face so many needs.

“I don’t know how you can expect the public to believe you when you say there is no money to invest in the services Utahns need and use every day and also, ‘We are going to keep giving tax cuts that go largely to the top 1% of Utahns,’” Thomas said.

“Practically speaking, we know our state leaders will do as little as possible to address this issue,” she added.

Utah has not yet seen a drop in official licensed child care spots, Thomas said, “but we do know from child care providers that a lot of those spots are going unused because they can’t afford workers” without public funding support.

“We’ve heard a lot of really heartbreaking stories from providers who have had to raise their tuition and watch families that they care about … drop out of their program and find some unknown child care arrangement to make sure their kids are safe while they’re working,” she said.

Stock image | Photo by qkonstudio/iStock/Getty Images Plus, St. George News

When affordable, quality, licensed child care becomes less accessible, Thomas said people will turn “more and more to suboptimal situations” like unlicensed care, a patchwork of family and friends, or swapping schedules with their spouses. Women are also likely to shoulder more of the burden, perhaps by staying home and not working.

That will likely “hide the impact,” Thomas said. “People find a way to make it work in ways that are really stressful and painful for families. That’s not good for the family. That’s not good for the kid.”

Thomas said Voices for Utah Children supports Escamilla’s bill to at least somewhat help ease the child care crisis. Though she said the issue needs much more immediate funding, Escamilla’s bill is better than nothing.

“It will hopefully, in a few years, add, I don’t know, a few hundred child care spots,” she said, “But it doesn’t help anybody now.”

Thomas said Escamilla “knows what is politically viable, and she knows her colleagues don’t want to invest much money in this. So using existing resources makes sense.”

But if Voices for Utah Children could have its way, Utah lawmakers should take the $160 million they’ve reserved for tax cuts and put it toward child care.

“They should realize that amount is actually less than what we’ve been spending in child care in federal dollars, and they should give it to the Office of Child Care to continue to support child care programs and make child care subsidies more available for Utah families,” she said.

“We know what works.”

Written by KATIE MCKELLAR, Utah News Dispatch.

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