The principal purpose of this hearing is to receive testimony with regard to S. 2178, The Children's Development Commission Act of 1998. This legislation was introduced by Senator Kohl and myself on June 16 of this year. A companion measure, H.R. 3637, was introduced by Representative Carolyn Maloney and Representative Richard Baker on April 1, 1998.
This legislation addresses a serious problem facing American families today - the shortage of affordable, quality child care. America is facing a shortage of quality child care which is approaching crisis levels. This shortage bears most heavily on working families, including young working single mothers. Every day, more than 5 million children under age 13 are left unattended after school.
The high cost of child care impacts directly on families, affecting their ability to pay the rent or the mortgage, to put food on the table, or to save for their children's education. The lack of decent, high quality child care also impedes the development of critical learning skills these children will need in order to succeed later in life. Social and medical research continues to point to the importance of the first three years of development on a child's future well-being and ability to learn.
In New York, the average cost of day care is over $6,000 per year - and many families end up paying nearly $ 1 0,000 per year, depending on the number of children. Lack of affordable child care impacts not just families, but the economic health of the entire country. The amount U.S. employers lose due to child care-related absences is estimated at over $3 billion.
Many families are unable to locate quality child care at all, as evidenced by the long waiting lists at existing centers. In New York City, approximately 28,000 families are on waiting lists for assistance under the Child Care Development Block Grant Program. And these latest statistics do not yet reflect the effects of welfare reform. As more families make the difficult transition from welfare to work, waiting lists for affordable care and assistance will likely increase significantly. As a result of welfare reforin, by the year 2002, there may be as many as 135,000 additional infants and toddlers in New York who will need affordable quality child care.
These high costs and the overall shortage of quality care are found in all areas of my home State - cutting across urban and rural boundaries. The New York Human Services Administration estimates that more than two-thirds of children in the Morrisania section of the Bronx and more than 70% of children in the Brownsville section of Brooklyn are in need of better child care.
This shortage extends to rural areas of New York as well - for example, in Allegany, Hamilton, Washington and Yates counties there are absolutely no registered programs for school age children. This bill will employ a number of cost-effective strategies to increase the availability and affordability of child care throughout the nation.
First, the legislation would reduce lender risk by creating a new insurance authority within the Department of Housing and Urban Development's Federal Housing Administration (FHA). This new FHA insurance program will provide loan guarantees for child care facilities and thereby spur the provision of private capital for the construction of new child care centers and the improvement of existing facilities. These loan guarantees will help to leverage up to $2 billion in private mortgage credit for new and refurbished child care centers.
Second, the bill will provide reasonable low-cost "micro-loans" for the renovation and improvement of current child care facilities through a Commission, known as "Kiddie Mac." The Commission will certify that facilities receiving FHA insurance meet state and local standards, such as licensing and child safety requirements.
Today, we expect to hear from a number of distinguished members and witnesses, including: Senator Herb Kohl from Wisconsin, Representative Richard Baker from Louisiana and Representative Carolyn Maloney from my home state. In addition, we have with us Cheryl Luce, a prospective child care provider who will testify on behalf of herself and Lifetime Television's Public Service Campaign "Caring for Kids: Our Lifetime of Commitment."
Finally, we have a number of distinguished experts in the field of child care delivery and early childhood development;: Faith Wohl, President of the Child Care Action Campaign; Melinda Green, Director of the African American Early Childhood Resource Center of the National Black Child Development Institute; and Mildred Wurf, Director of Public Policy for Girls Incorporated.
This bill is an important step in ensuring that child care facilities can gain access
to much needed private market credit. The Children's Development Commission Act
makes an investment in our children, an investment in our families and an investment in
our future. I look forward to working with my House and Senate colleagues for its enactment.
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