Good afternoon, Chairman Frumin, members of the Committee on Human Services, and staff. Thank you for the opportunity to address the Committee today. My name is Audrey Kasselman and I am a Ward 1 resident. I am a senior policy analyst at DC Action and with the Under 3 DC Coalition. Under 3 DC is a coalition that is committed to building a racially just early childhood system and to securing a strong start for every infant and toddler in the District. My testimony will focus on funding for the child care subsidy program. Thank you Councilmember Frumin, for your support to protect critical early childhood education funding.
Background on the Child Care Subsidy Program
The child care subsidy program is a cornerstone of DCʼs early childhood infrastructure. It currently helps nearly 6,800 families afford child care, supports childrenʼs healthy development, and enables parents to work or attend school. The child care subsidy program serves families earning under 300% of the federal poverty level ($90,000 for a family of four) – and these families rely on this support to access high-quality early childhood education.
While the child care subsidy program is governed by the Office of the State Superintendent of Education (OSSE), and a majority of its funding sits within that agency, the Department of Human Services (DHS) does receive critical subsidy funding and is responsible for determining parent eligibility and processing parent applications. All child care subsidy funding that currently sits at DHS (and OSSE) is critical to the success of the program.
In the past year, since OSSE and DHS partnered to remove barriers to subsidy enrollment, the District has seen a substantial increase in participation in the program. According to Mayor Bowser’s earlier statement on the ECE budget, 6,796 children (including infants/toddlers, preschoolers, and school-aged children) were enrolled in the subsidy
program as of March 2025. This represents an increase of 1,226 children from October 2024 – 22% growth – enrolled in the program. We are pleased to see this enrollment increase, which means that the program is serving more eligible families and ensuring that more children have access to affordable, high-quality child care while their parents go to work or school.
Without the child care subsidy program, access to high-quality early learning would be out of reach for thousands of DC families with low and moderate incomes. On average, District families with a median income allocate 26% of their earnings to child care costs. For families with low incomes, this percentage climbs to over 32%, placing a substantial economic strain on these households. In this context, child care assistance remains a necessary investment even in a constrained budget to ensure children can access high-quality early learning programs during their most critical developmental years, and so parents can go to work or school while they do so.
Furthermore, a recent Under 3 DC report finds that a lack of access to affordable child care leads to $252 million in lost wages for DC parents, $79 million in lost productivity and turnover costs for DC employers, and $64 million in lost tax revenue for the District. Early care and learning are economic anchors and drivers for our city yet funding for the child care subsidy program has gone in the wrong direction with significant reductions (over $20 million) over the past two years.
Funding for the Child Care Subsidy Program
Thanks to the success of the program itself and recent policy changes, the Council must ensure that funding for the child care subsidy program keeps pace with the growth in enrollment. While the Under 3 DC Coalition is still working to understand the implications of the Mayorʼs proposed budget, according to our current understanding, the FY26 budget includes $86 million in total funding for the child care subsidy program. This includes $52.1 million in local funds and $10 million in federal funds for a total of $62.1 million at OSSE and $24 million in funds at DHS. Our initial read of the budget proposal is that the $62.1 million in funds at OSSE represents a $5.6 million cut to the program.
While we are glad to see all of the DHS local TANF dollars preserved in the Mayorʼs budget proposal, our preliminary analysis of the Mayorʼs FY26 budget proposal indicates that total programmatic funding for the child care subsidy program is woefully insufficient to meet the current needs of the program or the families it serves. The child care subsidy program cannot sustain any cuts to its budget for two key reasons.
- Enrollment is growing significantly – an increase of 1,226 children (22% increase) between October 2024 and March 2025.
- The District is federally required to continue providing subsidies to all families currently enrolled.
For context, in FY24 OSSE spent $105.5 million on child care subsidies to serve 5,570 children. The FY25 budget allocates just $96.3 million, already creating a $9.2 million shortfall to maintain the previous caseload. The FY26 proposal appears to provide only
$86 million, even as the number of children enrolled in the program has risen to 6,796. The child care subsidy program cannot be underfunded and the program urgently needs and deserves enhancements.
Looking Ahead:
As budget deliberations begin in earnest, we are asking you to:
1. Protect all $24 million in child care subsidy funds at DHS in FY26 and the out-years
The child care subsidy funding at DHS specifically is critical to the programʼs overall budget and ability to serve currently participating families. Given the recent increase in caseloads and the subsequent increase in costs to the program, every dollar is essential. Protecting this funding is not only the right thing to do for currently participating families, the District economy, and future generations, but it is also essential given the numerous federal protections in place that require the District government to continue to serve all families on the current caseload.
2. Work with the Committee of the Whole, OSSE, and the Bowser Administration to determine how much funding the child care subsidy program needs to maintain current caseloads
As we continue to analyze the Mayorʼs budget proposal and its implications for early childhood education and young families, we encourage the Committee on Human Services to ask DHS agency officials, when they testify before your Committee, about:
- How much funding the agency needs to continue serving all currently enrolled families;
- What the average monthly uptick in subsidy enrollment has been since the agency instituted policy manual changes, including the number of parents starting applications and the number of parents being approved for subsidy;
- How the agency plans to manage growing child care subsidy caseloads with current funding levels;
- How much funding the agency believes they need to implement the program without implementing a waitlist for families; and
- Whether the agency believes they need more staff to manage growing caseloads.
We also request that you work with the Committee of the Whole to ask these questions of OSSE and that your Committees work together to look across the four year spending plan to understand how much funding is necessary for the child care subsidy program in the out-years, assuming continued modest growth in enrollment.
3. Ensure that the child care subsidy program is adequately funded in FY26 and in the out-years to maintain current and growing caseloads
Based on our initial analysis, we are concerned that the currently proposed funding levels fall short of what is needed to maintain access for current families (which again is required under federal regulations), let alone to support future growth of the program.
Limiting access to the subsidy program by underfunding it would create significant barriers for parents seeking work or education, limiting their economic mobility, increasing their reliance on public benefits also operated by DHS, and negatively impacting early learning opportunities that are essential for a young childʼs development. Only with adequate funding can we prevent these detrimental outcomes and keep affordable child care accessible for District families with low incomes.
The District of Columbia has not had a waitlist for families seeking to participate in the child care subsidy program in over 30 years. Implementing a waitlist due to lack of sufficient funding would be a devastating step backward – undermining decades of progress in expanding access to early childhood education. We cannot allow budget shortfalls to jeopardize the stability of families or compromise the educational and developmental needs of our youngest children.
Thank you for the opportunity to share about the importance of fully funding the Child Care Subsidy program and protecting all of its funding at DHS. I am happy to answer any questions.
