South Dakota House passes childcare assistance bill for higher worker income eligibility

The South Dakota House of Representatives convened on March 13, 2025, to discuss several key legislative issues, with a significant focus on House Bill 1132. This bill aims to establish new eligibility provisions for the childcare assistance program, specifically targeting childcare employees.

The primary concern raised during the meeting was that House Bill 1132 shifts the childcare assistance program away from its original mission. Currently, this program serves as a safety net for low-income families, helping them cover childcare costs while they work towards self-sufficiency. However, the proposed bill would allow childcare workers to receive assistance at a higher income level, marking a notable change in the program's focus.

Critics of the bill highlighted that this would be the first instance in South Dakota where state safety net programs provide enhanced benefits based on occupation. They argued that this change could transform the childcare assistance program into a long-term workforce subsidy rather than maintaining its intended purpose of offering temporary support to families in need.

Furthermore, concerns were raised regarding the financial implications of the bill. It was noted that the legislation does not include any appropriations to fund the proposed expansion. If only 5% of the current childcare workforce applies for assistance, the program could require an additional $3.8 million in state general funds. Should half of the workforce seek aid, the financial burden could escalate to $38 million. This lack of new funding could lead to a zero-sum scenario, potentially resulting in reduced benefits or longer waiting lists for low-income families who the program was originally designed to support.

The Department of Social Services has been actively working on solutions to support the childcare industry and workforce, emphasizing sustainable approaches that do not involve expanding the safety net program beyond its intended purpose. The overarching goal, as discussed in the meeting, is to promote economic development and encourage private sector solutions rather than broadening government safety nets into permanent workforce subsidies.

In conclusion, the discussions surrounding House Bill 1132 highlighted significant concerns about the potential shift in focus of the childcare assistance program and its financial sustainability. The House will continue to deliberate on this bill and its implications for South Dakota's families and childcare workforce.