amount of funds to allocate for child care. It's too early to know whether we'll even have as much as $1 billion. And we listened to a description of the ABC bill, and it will cost something in excess of $2 billion. Others are talking of $2 to $22 billion. If you had a billion dollars for child care, how would you spend it? Would you do it by increasing Title XX funding? Would you do it through the tax credit? Would you do it through a new discretionary program? Sitting here in our position, what would you do? Mr. SCHEPPACH. Let me say first that the policy the Governors adopted talks about a balanced approach. And I think that I need to probably get further clarification from them before I say that this is essentially their policy. But my own sense is that you need to be talking about a minimum of 35 to 40 percent in the grant and the tax credit side of it. The Packwood-Moynihan bill talked about, a total of about $3 billion, of which $2.6 billion was on the tax side and $400 million was on the grant side. That seems to be too little for the grant program. We are particularly concerned that we are in fact going to get some Federal standards that we oppose— The CHAIRMAN. Let's say we are talking about a billion. Mr. SCHEPPACH. My own personal feeling again is that a 50-50, 60-40 kind of distribution might well make some sense. The CHAIRMAN. Well, to some people, balance can be tilt. You said 50-50 and then you said 60-40. Mr. SCHEPPACH. I think within those ranges, the Governors would find that acceptable, but I would prefer to get back to the Governors to get you more specific information on that, Mr. Chair man. The CHAIRMAN. When you said 60-40, are you saying tilt it either way? Mr. SCHEPPACH. Either way. Once you get in that range, it's difficult for us to say. I also believe it depends to some extent whether you combine the Bush proposal for the children's component in the tax side of it. The Governors' position is basically that they want the maximum amount for low-income recipients, and I think that leads you toward the refundability of the current tax credit. The CHAIRMAN. Are there further questions? Senator DURENBERGER. Mr. Chairman? The CHAIRMAN. Yes, Senator Durenberger. Senator DURENBERGER. Thank you, Mr. Chairman. Do either of you gentlemen have an estimate of the total dollar need out there. I just want to follow up on the chairman's question. He said we've got a billion dollars to spend. In this other committee I'm in, we passed out a bill that was $2.6 billion. If we were going to do it all up right this year, what is the dimension of the problem or the opportunity? Mr. HAYWARD. I think first of all, you have to define what you mean when you say "do it up right.” That's an issue that I don't think has been determined. Are we really going to try to target this program for the very low-income? If you take a look at some of the tax bills, they touch some folks that maybe don't need the help. So I think you have to really define what "do it up right" means and then go from there. I would suggest from our deliberations in APWA, $2.5 billion is a figure that we've tossed around, and I think that it is an amount of money, were a bill passed, that could be workable. It may not meet all of the problems that are out there, but I think that you can work with that amount of money to begin to build up some of the infrastructure, working with the private sector. I think this is an area where the private sector can be extremely helpful. If we are able to create more slots because of competition and allow the free market to work its will. Senator DURENBERGER. Let me ask the question somewhat differently. Do either of you have the figures readily available to you that the Federal government is presently spending on child care outside the home? Mr. SCHEPPACH. What the Federal government is currently spending? Senator DURENBERGER. Right. How much Federal money this year is going into child care. Mr. SCHEPPACH. I think the Congressional Research Service has done an analysis of that. My sense is it's in the $6 to $7 billion range if you talk about both tax expenditures and grants. Senator DURENBERGER. What does $1 billion added to $7 billion accomplish? Mr. SCHEPPACH. I think the two issues here are quality and affordability. I think the tax credit does get at some of the affordability issues. Senator DURENBERGER. How many people get more affordable child care for another $1 billion? Mr. SCHEPPACH. Senator, I think that as in all tax expenditures, you're trying to impact a fairly small group on the margin, and I think that's true of this, as it's true of the Research and Technology Tax Credit and so on. I don't disagree that the need out there is substantial. I don't think it's a supply problem as much as it is a quality problem. We're trying to get a higher level of development for children and it's very hard to put a price tag on that. Senator DURENBERGER. I've just gotten used to, over the years, the Governors coming in with fairly clear, concise-and I'm not criticizing your statement-but speaking for the need out there, we've come to rely more on the Governors than we have on ourselves, I think, to articulate the need. Frankly, I can't get a sense from your position statement what the folks out in the trenches see the need to be and why we ought to act. Your problem obviously is, you've got 535 estimates of both the need and how to solve it around here, and yet you are the folks out there that are actually right now trying to deal with these problems. Mr. SCHEPPACH. We could perhaps try to survey some States and get you some information. But I think the Governors have been constantly concerned about the Federal deficit and therefore have been reluctant to come up here and ask you for large sums of money. The CHAIRMAN. Well, that's very interesting. [Laughter.] Forgive me, Senator, I apologize. Senator DURENBERGER. No, I think I have finished. Senator CHAFEE. Mr. Chairman, I would like to put in a statement if I might. I'm a sponsor of the ABC bill and I look on this legislation, these efforts, as not a woman's issue, but a family issue, and I want to commend you for holding these hearings. I suspect when we get finished, that it will be some combination of the ABC and the tax credit legislation. Certainly I am going to do everything I can to be helpful in that and would ask that my full statement be included in the record. The CHAIRMAN. That will be done. [The prepared statement of Senator Chafee appears in the appendix.] Senator PACKWOOD. Could I ask, Mr. Scheppach, would you express my appreciation to both Governor Clinton and Governor Kean? They worked personally with me, their staff and the Governors with ours, in making some changes in our bill and adopting some of the things they wanted, and I appreciate very much the Governors' help. Mr. SCHEPPACH. Thank you. I know they apologize for not being able to be here, but they had scheduling conflicts. The CHAIRMAN. Senator Moynihan. Senator MOYNIHAN. Just to continue in that vein, to say to Mr. Scheppach and Secretary Hayward, the two of you respectively represent the principal organizations who were with us in the welfare legislation of last year. Without you, we wouldn't have enacted it and we wouldn't be on to this next subject today. There are precious few like you, if I may say, and thanks to the Governors and to the APWA. I have one question which I just would like to know if you're thinking about. When Secretary Hayward mentioned the wonderful report, "One Child in Four," that you gave us about poverty in this country, that 1 in 4 ratio happens also to be the illegitimacy ratio. One child in four born today is born to an unmarried parent, mother. The range, Senator Packwood and I straddle it. The ratio is 20 percent in Oregon, 30 percent in New York. And that seems to some persons at least the beginning problem with which we are trying to deal here. Yet we hear very few comments about it. Is there a public policy response to that problem or is that something just beyond us, or are we have not even begun to think about it? May I ask Secretary Hayward? You are most directly involved in APWA. Mr. HAYWARD. Well, obviously, the teen pregnancy issue, which is where a lot of those one in four that you discussed come from, is an issue which APWA is very actively working on. A number of States have various types of projects going on to try to deal with the teen pregnancy issue, anywhere from ad campaigns to dealing directly with providing specifically day care for those very young parents. Senator MOYNIHAN. Day care for those parents. Mr. HAYWARD. For the parents-or their children-but providing other educational programs directly in concert with child care. Senator MOYNIHAN. That is certainly part of this problem. I mean it's day care while you finish school. Mr. HAYWARD. That's correct. Senator MOYNIHAN. Thank you, Mr. Chairman. And thank the Governors' Association and the APWA. We would not be on this issue if you hadn't been with us last year on that issue. The CHAIRMAN. Let me further state that I noticed when I said if we had as much as a billion, that a number of people brightened up, and I want to be sure they understand I said "if" we had as much as a billion, and we have absolutely no assurance of that. We have a really tough job to fill in trying to find the funds, whatever they might be. Thank you very much for your contribution. We appreciate it. Our next panel consists of Mrs. Marian Wright Edelman, President, Children's Defense Fund, Washington, DC; Elizabeth Kepley, with the Family Research Council, Washington, DC; Dr. Caroline Zinsser, Director of Research on Early Childhood, Center for Public Advocacy Research, New York, New York. If you would come forward, please. We are very pleased to have you. Ms. Edelman, will you lead off, please. STATEMENT OF MARIAN WRIGHT EDELMAN, PRESIDENT, CHILDREN'S DEFENSE FUND, WASHINGTON, DC, ACCOMPANIED BY HELEN BLANK, DIRECTOR, CHILD CARE, CHILDREN'S DEFENSE FUND Mrs. EDELMAN. Thank you, Mr. Chairman. I thank you for your leadership and for the leadership of this committee in analyzing the many problems facing children and families, understanding their complexities and in trying to formulate appropriate policy re sponses. I am pleased that this committee is now exploring ways of helping the child care problems facing many American families, and we thank you for the opportunity to testify. We thank the members of this committee, like Senators Chafee and Moynihan, who are cosponsors of the ABC bill as well as other bills to supplement the ABC approach. We have developed a short fact piece on child care which we would like to submit for the record and we hope it will help provide this committee with a better understanding of why so many parents are frustrated today. I think you have heard from enough witnesses-and I'll skip over it-that we do have three main facets of the child care problem, the issue of cost, the issue of quality and the issue of availability. We are very heartened by the bipartisan consensus that is backing Federal action to address the child care problems faced by millions of parents. The number of proposals I think reflect the breadth of congressional concern and offer a variety of creative and complementary approaches. I think it's essential that these proposals be reviewed with the interests of children and families uppermost in mind and whatever the name, the number, or the sponsor of final child care legislation, we hope that those provisions will draw from the very best of them to ensure that there will be sufficient assistance to low-income families to enable them to afford safe and decent and quality care for their children while they're working outside the home. We hope that any final proposal will improve significantly the quality of child care so that all parents can go off to work and be assured that their children are safe and are being put in a place where they can develop appropriately. We hope that any final provisions will provide maximum real choices for parents and give them a wide variety of options to choose from, and we also hope that any final proposal will help lay the foundation for a sound comprehensive child care system that we can build on in a variety of ways in the future as the need grows. We support targeting funds for child care on those children most at need, but we favor doing that in the context of a broader creation of a system so that help to poor children will not be part of what becomes a poor child care system. We also believe that any final child care bill should build upon current State and local policies and practices, and we think that the ABC bill will help the lowest-income families pay the full cost of child care at current market rates and do some help for low and moderate-income families, but we also think that is a next step forward from what States are already doing. With ABC's assistance, thousands of our poorest working families will have access to a wide range of decent options now only available to the more affluent families. This includes relative care, it includes family day care homes, group homes, centers operated by community organizations, schools, religious congregations, employers, and others. We really do back ABC's focus on improving the quality of care and assuring parents of safe care when they're at work. We do support national standards for health safety and quality. I do not think that children in Arkansas or children in one State should have less access to safe quality child care than children in another State that may be wealthier or able to provide for these minimal qualities of care. And one of the kinds of basic assurances that ABC attempts to provide is to, for example, ensure that parents have unlimited access to their child care centers. In a number of States, parents can't just drop in and see how their children are doing. It ensures that children will be immunized, which seems to me basic in ensuring the health of our children. And it ensures that providers should be prepared, through some minimal experience and training, to care for children. We think these are impor tant. I think that ABC does provide incentives for States by setting aside money to help them and communities and employers and other providers expand and improve their supply of child care. But we realize that the passage of ABC alone is not the only possible approach, though we do believe that it is an essential piece of any comprehensive approach. We think that tax credits are important supplemental mechanism. We have two crises in this country, the crisis of low-income families not having enough income, and we think that a tax credit like the EITC or the Dependent Tax Credit, whose refundability we have supported for a number of years, would be significant supports on this particular crisis and so we favor them as a supple |