Bill Summary – FastDemocracy

Fiscal Note
                                       Fiscal Services Division
HF 343 – Child Care Assistance, Eligible Individuals (LSB1102HV)
Staff Contact: Christopher Ubben (515.725.0134) chris.ubben@legis.iowa.gov
Fiscal Note Version – New
Description
House File 343 directs the Department of Health and Human Services (HHS) to establish an
Enhanced Child Care Assistance Pilot Program (ECCAPP) to extend eligibility for State child
care assistance to children of child care workers employed full-time by a child care facility from
July 1, 2023 to June 30, 2025.
The HHS is also directed to submit a report on the pilot program to the General Assembly on or
before March 1, 2025. The report is required to include the number of applicants approved for
the pilot program who would otherwise have been denied due to income limits, the total number
of families served by the pilot program, and the total annual cost of the program.
Background
The Child Care Assistance (CCA) Program was established in 2000 to subsidize child care
costs for low-income families with parents who are working, gaining work skills, attending
school, or otherwise unable to care for children due to physical or mental illness. The CCA
Program provides financial assistance for the care of children under the age of 13 in a number
of circumstances based on the income level of the parents and the needs of the children.
In fiscal year (FY) 2023, the State General Fund appropriation to the CCA Program was $40.8
million. Federal dollars from Temporary Assistance for Needy Families (TANF) provided $26.2
million and Child Care Development Fund (CCDF) provided $84.5 million for the CCA Program.
The carryforward at the end of FY 2022 was $73.4 million, and the FY 2023 surplus is projected
to be approximately $93.5 million.
Assumptions
The HHS reports that implementation of the pilot program will require 880 hours of IT contractor
time to develop a new program and modify the copay structure to implement the new program in
the KinderTrack system. The Bureau of Data and Business Intelligence would need to devote
approximately 44 hours of contractor time to update reporting systems for the data warehouse.
In addition, the Bureau of Project Management will require 92 hours of project management
time to oversee the pilot program and 304 hours of business analyst time to meet the reporting
requirements. All of these hours, 1,320 total, would be billed at $125 per hour.
Of the approximately 10,000 child care workers employed full-time in Iowa, 5.0% (500) are
currently ineligible for assistance due to CCDF program income limits. The average cost per
child care unit is approximately $20 per unit. At 10 units per week, the average weekly cost per
child would be approximately $200 per week.
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Fiscal Impact
Table 1 shows the breakdown of expenses required to establish, support, and maintain the
Child Care Assistance Pilot Program.
                                 Table 1 — Contractor Hours and Costs
     Contractor                                      Estimated Hours           Hourly Rate          Total Cost
     KinderTrack Update                                                880      $         125       $ 110,000
     Data Warehouse Reporting Update                                    44                125            5,500
     Project Management                                                 92                125           11,500
     Business Analysis                                                 304                125          38,000
     Total                                                                                          $ 165,000
The fiscal impact for HF 343 cannot be determined as the number of eligible workers that will
enroll in the Program is unknown. However, Table 2 displays a range of costs based on the
percentage of eligible workers enrolling in the program with an estimated average of 2.0
children per enrolled worker. Program expenditures will begin in FY 2024 and will be funded
from the Child Care Assistance (CCA) surplus.
           Table 2 — Average Annual Cost by Percent of Eligible Workers Enrolled
    Percent of                         Number of               Estimated Number of                  Average
    Eligible Workers            Enrolled Workers           Children in Care Centers              Annual Cost
                      10%                           50                                 100      $    1,030,000
                      25%                         125                                  250           2,575,000
                      33%                         165                                  330           3,399,000
                      50%                         250                                  500           5,151,000
                      66%                         330                                  660           6,799,000
Sources
Department of Health and Human Services
Legislative Services Agency
                                                                               /s/ Jennifer Acton
                                                                                March 22, 2023
Doc ID 1370549
The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in developing this
fiscal note is available from the Fiscal Services Division of the Legislative Services Agency upon request.
                                                 www.legis.iowa.gov
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