Association for Public Policy Analysis & Management

The federal Child Care Development Fund (CCDF) child care subsidy program is a crucial support for over 1 million low-income working families in the U.S.  In 2014, CCDF was reauthorized for the first time since 1996, outlining key responsibilities for states, including increasing the supply of quality child care for subsidy recipients and promoting parental choice in care.  Most states promote parental choice by delivering subsidies in the form of vouchers, which parents can use at the provider of their choice.  To increase supply of quality providers, states may increasingly use “dual-mechanism” subsidy systems in which child care subsidies come in two different forms--vouchers and contracted slots, which are slots set aside by providers with direct contracts with the state.  The use of contracts is a strategy specifically outlined in the new CCDF rules.  While only a few states have dual-mechanism systems in place, it is an important time to learn how existing systems balance the tension between promoting parental choice and using contracts to increase supply. Contracts can be a useful tool for states to bolster supply, but they also increase the state’s role in shaping the set of providers that parents can choose from. This paper fills important gaps, as research on the use of contracts for subsidy delivery is limited, and very little is known about the balance between voucher- and contracted-providers in local markets.  

This paper examines the geography of the dual-mechanism subsidy system in Massachusetts, examining how the supply of voucher- versus contracted-providers varies locally, and how these characteristics of supply compare with local demand for subsidies. The maps are derived from a combination of geocoded administrative data from the Massachusetts CCDF administrative data systems and from the American Community Survey.  

The mapping work presented in this paper compares the estimated subsidy-eligible child population with the presence of each type of provider--voucher-accepting providers and contracted providers--for all towns in Massachusetts.  For the purposes of subsidy administration in Massachusetts, the state is divided into 10 Child Care Resource and Referral (CCR&R) regions, each made up of several towns. The analysis therefore assesses both within- and between-CCR&R region variation and also examines patterns in the local supply of voucher- and contracted-providers with NAEYC accreditation, a marker of provider quality. 

We observe substantial variation in local patterns, highlighting how local parental child care choice sets vary by town and by CCR&R region. The paper demonstrates the importance of examining the local contours of dual-mechanism subsidy systems, and the utility of maps to inform the work of both state-level policymakers and local subsidy administrators. Policy applications, including the use of maps to identify and advocate for children in underserved locations, are discussed, as well as implications of using a dual-mechanism subsidy system.

This research was conducted in connection with an Office for Planning, Research and Evaluation (OPRE) Child Care Research Partnership Grant in Massachusetts.  In terms of policy applications, the maps were informed by and disseminated to both state and regional CCDF administrators in Massachusetts.