LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 6978 NOTE PREPARED: Jan 5, 2024
BILL NUMBER: HB 1257 BILL AMENDED:
SUBJECT: Child Care Assistance Eligibility.
FIRST AUTHOR: Rep. Shackleford BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
DEDICATED
XFEDERAL
Summary of Legislation: The bill provides that a household is eligible to begin receiving assistance under
the federal Child Care and Development Fund (CCDF) voucher program if the household, at the time of the
initial determination of the household's income eligibility by the Office of the Secretary of Family and Social
Services (FSSA):
(1) has a household income that does not exceed 85% of Indiana's state median income for
the household's family size;
(2) includes an individual who is employed by a licensed child care center, a licensed child
care home, or a licensed or registered child care ministry; and
(3) otherwise meets federal eligibility requirements for the CCDF program.
The bill also provides that a child who:
(1) is a member of a household with an annual income that does not exceed 85% of Indiana's
state median income for the child's family size;
(2) resides with a parent or guardian who is employed by a licensed child care center, a
licensed child care home, or a licensed or registered child care ministry; and
(3) meets other eligibility requirements for the prekindergarten program under current law;
is eligible for assistance under the prekindergarten program.
Effective Date: Upon passage.
Explanation of State Expenditures: The bill will make the CCDF program and the prekindergarten
program available to child care workers at a higher initial income eligibility level as compared to other
eligible families. The number of eligible children will increase to the extent that child care workers do not
HB 1257 1 meet the current lower income eligibility criteria for these programs. Ultimately, the additional cost of
vouchers will depend upon appropriations made and administrative actions.
Additional Information - CCDF Voucher Program and OMWP: Each state develops its CCDF voucher
program requirements and benefits within the federal program framework. The number of eligible children
under this bill will increase to the extent that child care workers do not meet the current, lower income
eligibility criteria for these programs. The annual median income for child care workers in Indiana is
$25,730. A family size of three or more earning the Indiana median income would meet the current income
eligibility requirements. Additional vouchers may be funded through reduced award amounts or additional
funding support.
As of July 2023, there were 31,482 families and 57,469 children authorized for CCDF vouchers. The average
annual cost of care was $13,548 per child, with the CCDF voucher program paying about $12,207 (90.1%)
of the cost. The OMWP support is statutorily required to be between $2,500 and $6,800.
CCDF Funding: Indiana received $340.5 M in CCDF funding from all sources in grant year 2023. The
federal CCDF program provides funds to the states for child care services in three ways, mandatory,
matching, and discretionary appropriations. The federal funds are allocated to the states by several formulas
based on a historic federal program’s spending and demographic and economic characteristics of the state.
The states are required to provide matching and maintenance of effort funds, and have discretion to transfer
funds from the Temporary Assistance to Needy Families block grant (TANF). In recent years, Indiana has
transferred about $62 M per year, the full amount available from TANF, maximizing the state’s federal
funding available for child care.
Income Eligibility: The federal CCDF voucher program allows for families to be income eligible up to 85%
of state median income (SMI), which in Indiana is equal to 185% of the federal poverty level (FPL).
Currently, Indiana uses 112% FPL for the initial eligibility. The OMWP has two income qualification levels,
up to 150% FPL for an eligible child and up to 185% FPL for a limited eligibility child. The following table
shows annual income of a family of three at various income eligibility measures.
2023 Annual Income for a
Family of Three
100% FPL $24,860
112% FPL $27,843
150% FPL $37,290
185% FPL $45,991
100% SMI $69,900
85% SMI $59,412
Explanation of State Revenues:
Explanation of Local Expenditures:
HB 1257 2 Explanation of Local Revenues: Locally owned child care providers could receive additional funding to
the extent that they have unused capacity.
State Agencies Affected: Office of Early Childhood and Out-of-School Learning, Family and Social
Services Administration.
Local Agencies Affected: Locally owned child care providers.
Information Sources: Bureau of Labor Statistics, Department of Labor, Occupational Employment and
Wage Statistics Survey, May 2022; LSA, Tax and Revenue Handbook, FY 2023; Office of Early Childhood
and Out of School Learning, CCDF Voucher and CCDF Centers Programs, July 2023;
https://www.acf.hhs.gov/occ/data/gy-2023-ccdf-allocations-based-appropriations.
Fiscal Analyst: Karen Rossen, 317-234-2106.
HB 1257 3