It’s no secret that childcare is expensive and unaffordable for too many Americans. A 2013 report from the Oregon Child Care Research Partnership at Oregon State University recently drove the point home with these two jaw-dropping facts:
- Costs More than College. Childcare can cost nearly twice as much as college tuition at Oregon’s public universities (but without the 18 or so years to save up!): Median toddler care = $11,064 v. $6,679 average annual college tuition.
- Costs Up, Wages Down. Child care prices in Oregon increased 13% from 2004 to 2012 while household incomes declined 9% (15% for single mothers).
At the same time, people who work in childcare earn low wages and often receive inadequate benefits. Safety and quality is also an issue, with many children in care situations that fail to appropriately educate and protect them. This April 2013 cover story in The Nation magazine lays out the way quality, affordability, and the need for parents to leave their children somewhere while they work intersect through a tragedy in Texas.
We look forward to a BIG conversation about childcare affordability in Oregon and how we can create a real childcare system that enables workers to earn a living wage, children to be safe and educated, and parents to afford quality care while they work.
Thankfully there are several programs in place that work well: Employment Related Day Care (ERDC) is one of them.
What is the Employment Related Day Care Program (aka ERDC)?
ERDC is a child care subsidy program run by the State of Oregon that helps low-income, working families whose income is less than 185% of the Federal Poverty Level ($40,800 annually for a family of four) pay for day care so they can work. Subsidies fill the gap between what resources a family has compared to the resources a family needs to maintain safe, dependable child care that supports children’s development and family self-sufficiency.
Families are responsible for paying a portion of their day care expenses through a co-pay that is individually determined, based on the size of family and their income.
How do families benefit from ERDC?
The two most obvious benefits of a childcare subsidy to low-wage families are 1) making childcare affordable enough that work becomes possible, and 2) by freeing up wages to pay for other essentials like rent and food. For minimum-wage earners childcare frequently takes 60% of their take-home pay. Another important benefit is that parents are able to pursue better, more stable child-care arrangements.
How many families access the program?
Approximately 8,500 families are enrolled in the ERDC program — of an estimated eligible 12,000. The 8,500 was set by the 2012 state legislature, which cut ERDC funds below the 10,000 families recommended by the Save ERDC Coalition. We think the program should be adequately funded to serve all eligible Oregon families.
What happens when childcare subsidy funding is cut?
When the state cuts subsidy funds (as the legislature did in 2012), families and child care providers (owners and employees) who service subsidized clients are directly affected.
- Families are less likely to work (because they must provide care for their children) and more likely to struggle with short- and long-term self sufficiency,
- Children are less likely to be in quality, stable care (which has been shown to hinder their long-term success), and
- Child care providers are more likely to struggle financially or close when they lose subsidized clients.
How is the program funded?
Oregon’s ERDC program is funded through the federal Child Care Development Fund (CCDF) and a required state match.
Learn more about ERDC:
- State of Oregon ERDC Program
- University of Oregon 2009 Research Report
- Children First for Oregon’s 2013 ERDC Policy Brief