Bipartisan bill would help parents keep state child care assistance when receiving pay raises

Bipartisan legislation in the Missouri House seeks to help families stave off what’s called the “cliff effect,” with child care.

The “cliff effect” refers to a person receiving a pay increase that puts him or her over the income limit for receiving a state benefit.

“Basically it came down to this.  You make so much money and all of a sudden you fall off the cliff.  You get one more pay raise and you get no more day care subsidy,” said Representative Dan Shaul (R-Imperial).  “We found that to be counterproductive to trying to hand up.  All of a sudden, what’s the motivation to continue on?”

Shaul, whose wife is a social worker, and Representative Crystal Quade (D-Springfield), who herself is a social worker, are sponsoring identical legislation that would launch a pilot program in Green, Jefferson, and Pemiscot Counties.  It would allow individuals to participate in an existing transitional program.

That program offers tiered levels of childcare subsidies based on the individual’s income level, but requires participants to start at its lowest income level.  Under Quade and Shaul’s bills, a participant could enter the program at his or her current income level, rather than have to take a lesser-paying job.

Quade said the program would keep working parents from having to make tough choices about whether to accept better pay, or to decline it because it would not offset the cost of losing government assistance.

“It’s my belief that if we allow this to happen we will be essentially having more folks enter the workforce at a higher paying rate, eventually getting off of the state subsidies at every level if we’re allowing them to become productive members of society by not having to make those hard choices,” said Quade.

The House Committee on Children and Families held a hearing on those bills, House Bill 712 (Shaul) and House Bill 713 (Quade).  They heard testimony from several Missourians including Leann Seipel of Sparta, who told representatives she had to turn down a 15-cents per hour raise to avoid losing her child care subsidy.  She still lost the subsidy for one month.

“It cost me more than half of what I bring home in a month to provide child care for my children,” said Seipel.  “We ate a lot of Cheerios and ramen noodles that month, and it took me four months to pay off that debt for one month of child care.”

“It’s a very scary thing when you’re sitting there and you’re trying to do the math and trying to figure out, if I take this raise or if I take this new job am I going to lose my child care subsidy or food stamps or something,” said Seipel.  “When you’re living so close to the line, every little bit … it was a 15-cent raise.  15-cent raise killed us that month.”

Meghan Roetto of Republic moved from Montana to Missouri after her husband returned from serving in Iraq and left her and her daughter.

She told lawmakers she was frustrated when after going to college and getting a bachelor’s degree, she was offered a $10 an hour job, and that meant she would not be eligible for child care assistance.

“I felt punished for getting a degree and doing better, and being able to give to the workforce,” said Roetto.  “I chose to move from the nice home I lived in which did not have expensive rent – it was a wonderful neighborhood – to a smaller apartment that didn’t have as nice of a neighborhood – it was not as safe – so that I could continue to work.  I felt that I could move myself forward better.”

Shaul said he and Quade decided to work together on the issue after discussing it, “somewhere between Poplar Bluff, Missouri, and Rolla,” during the tour for freshmen legislators, held between the November election and before the start of session.

“It was a good trip.  We talked about kids, and parents trying to raise kids, and how we could help them with the child day care subsidy,” said Shaul.

The committee has not voted on those bills.