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Publicly Funded Child Care


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Public financing for child care in the United States has been inconsistent and has fluctuated widely over the past 70 years. When public financing first began, it typically was to solve a pressing social problem, but when the immediate crisis ended so did the funding.

The first federal investment in child care was made during the Great Depression. The motivation behind the movement was to provide government jobs to out-of-work adults. However, funding for services ended with the end of the Depression. The U.S.’s entrance into World War II generated an enormous demand for women labor in the war industries and federal funding for child care once again became available. Ironically after the war the federal government abdicated their support for child care and instructed women to quit working, return home and take care of their children; advice many women did not take.

During the 1960’s attitudes toward child care began to shift in part because of child development research. Out of this research the Head Start program was born. Then in 1974 Title XX of the Social Services Amendments allocated $2.5 billion annually for a variety of services, including child care. For a number of years Title XX was the sole source of public support for subsidized child care in many states.

Since 1962 child care payments has been available to recipients of welfare. Then in 1988 the Family Support Act (FSA) passed, which required many welfare recipients, including most mothers with preschool children, participate in education, training, or work. An increase in child care services was integral to the success of the new FSA.

Then, just two years after the passage of the FSA, the Child Care and Development Block Grant (CCDBG) became law. CCDBG seemed to result from growing recognition of the need for child care support among all families, not just those on welfare and the growing political muscle of middle and upper middle class women who demanded policy responses to some of their basic economic concerns and need for child care.


States have flexibility to design policies, define eligibility guidelines, service priorities, regulate provider payment rates and family co-payment amounts, all within the broad parameters specified under federal law.

The federal Department of Health and Human Services (HHS) provides funds to child care programs. Within HHS the Administration for Children and Families is responsible for establishing the regulations that carry out the law and provide states with direction in running the program.

The NYS Office of Children and Family Services (OCFS) administers child care and sets rules regarding funding distribution in accordance with federal and state laws and regulations. The office within OCFS responsible for overseeing the NYS child care services is the Division of Early Child Care Services.

The Office of Temporary and Disability Assistance, part of the New York State Department of Family Assistance, administers the Temporary Assistance to Needy Families (TANF) grant and transfers the child care-related TANF funds to the NYS Child Care Development Block Grant, which is administered by OCFS. Refer to Cash Benefits, Cash Assistance, Overview for more information on TANF.

New York is one of only eleven states in the country where local districts have the primary responsibility for supervising and administering child care subsidies through the local department of social services. Since 1992, New York has made progress towards creating a “seamless” child care subsidy system that is somewhat easier for parents to navigate and counties to administer. New York’s 1997 Welfare Reform Act consolidated the multiple child care funding streams into one block grant eliminating one of the most significant barriers to a seamless system. In December 2001, the Social Services Law was amended to eliminate the procedures requiring parents to reapply for child care assistance after they leave Cash Assistance. In addition, most counties now manage child care funding through one administrative work unit, which further simplifies the system.

In NYC publicly funded child care is administered by the Administration for Children’s Services (ACS) Division of Child Care and Head Start. ACS also oversees the federal Head Start program, as well as foster care, adoption, and preventive services. ACS administers childcare services in various settings to low-income families, including center based, family child care and legally exempt providers.

Four out of the 5 boroughs in NYC have an ACS borough office called an ACS Resource Area that acts as an administrative hub for ACS services in the boroughs. The Resource Areas maintain information on the eligibility status of children in care, children on the waiting lists, as well as information on centers and providers. See below, Government Contacts.

Additional NYC agencies involved with the administration of child care are the NYC Department of Health and Mental Hygiene, which licenses all group child care centers, family child care and group family child care, both public and private, (unless the program is exempted from licensing requirements) and monitors them to make sure they are in compliance with NYC health code; the NYC Department of Education, which runs the Universal Pre-K program and the Living for the Young Family through Education Centers, and the Department of Youth and Community Development, which oversees the school-age child care, referred to as Out-of-School-Time (OST). Finally, parents who are receiving Cash Assistance apply for child care and transtional child care through the NYC Human Resource Administration, refer to Cash Benefits, Cash Assistance, Returning to Work.


Funding for child care comes from the federal, state and local monies.

The federal Child Care Development Block Grant (CCDBG) is the primary source of funding for child care assistance for low and moderate income families. CCDBG also provides funds to states to strengthen the quality of child care. Under CCDBG states set policies, within federal parameters, that determine families’ eligibility for child care assistance, the amount of assistance families can receive, and families’ copayments. CCDBG funding can be used to subsidize care offered by a broad range of child care providers, including child care centers, family child care providers, relatives, and in-home care providers. In addition to the CCDBG grant, funding for child care also comes from the Temporary Assistance to Needy Families (TANF) grant, which provides money to states to provide Cash Assistance to families with children on Cash Assistance, and Title XX funding (also known as the Social Services Block Grant), which supports a broad range of social services, including child care for certain families.

New York State contributes a portion of the child care funding through the “maintenance of effort” requirement to receive the federal dollars. The Office of Temporary and Disability Assistance (OTDA) transfers the TANF funds to the NYS Office of Children and Family Services (OCFS), which pools the TANF and the CCDBG funds into the New York State Child Care Block Grant, which distributes the funds to the local social districts.

New York City provides additional funding for child care. NYC funding for child care must be approved by the City Council and signed by the Mayor, as part of the City budget.

Overview of Types of Child Care


There are many types of child care providers, including center-based care, home-based care either at the provider’s home or the caretaker’s home, and employer-based care. In NYC all these types of care exist in the private and public sectors. Many of the different kinds of child care can be publicly subsidized, some are not. Below is a description of all types of care available to NYC residents, whether funded by ACS or not.

Center-Based Care

Center-based care includes group child care centers, both private and non-profit. ACS can contract with a center, usually a community-based organization, to subsidize a certain number of child care spaces in the center, as well as to fully subsidize the child care center.

Center-based care also includes Head Start, Out-of-School Time (OST), after school programs (including community centers), Universal Pre-K, religious affiliated group care programs, centers in high school and colleges and nursery schools, including schools operated by religious organizations.

The regulatory agency responsible for monitoring center-based programs is the NYC Department of Health and Mental Hygiene, Bureau of Child Care.

Home-Based Care

Home-based programs include both family child care, operated by a licensed provider, and legally-exempt (informal) care provided by an unlicensed caretaker working in a family’s home or in the home of the provider. The NYC Department of Health and Mental Hygiene provides licenses for family child care providers. Informal providers are exempt from licensing requirements.

Employer-Based Care

Some employers offer child care for employed working parents. These programs are employer sponsored and outside the scope of this manual.

Summary of Publicly Funded Child Care

The Administration for Children’s Services (ACS) funds free or low cost subsidized child care services for eligible families living in New York City and is available for children ages 6 weeks through 12 years, while children with special needs may be able to receive care through age18. Eligible families are able to access child care services at group child care centers, family based child care, or through informal providers.

Most settings for publicly funded child care must be regulated, that is, the provider must go through a process to obtain certification that the child care program meets certain health, safety and programmatic standards, as prescribed by regulation. Publicly subsidized child care settings include center-based programs, home-based programs, and informal providers.

Under NYS provisions, informal providers are exempt from regulatory oversight, except they must be enrolled by a Legally Exempt Caregiver Enrollment Agency in order to receive government funds. NYS OCFS has contracted with the Women’s Housing and Economic Development Corporation (WHEDCO) to be the enrollment agency in NYC.

Families who are eligible for subsidized child care services and who can gain access will only pay a portion of the actual expense of child care services. In NYC, the Administration for Children Services (ACS) pays child care providers based on their costs of care up to the state market rate. Payment is made directly to the vendor through a computer based system known as ACCIS.

To qualify for a child care subsidy, a family must meet all Federal and state regulations of the program, which includes child eligibility (age of child), programmatic eligibility (need for child care), categorical eligibility, citizenship/immigration status, residency, and income requirements. Families can initiate the application process for publicly funded day either by calling 311, or they can apply directly with the ACS contracted child care center or family childcare network.

Per state regulations, families who receive a child care subsidy are authorized for a certain period of time. At the end of this period of time, families must continue to prove they meet the eligibility requirements for a child care subsidy, through the recertification process.