Hochul signs legislation creating 'streamlined system' for social service payments to child care providers

Governor signs legislation (A.5840-A/S.5162-A) requiring local social service districts to offer a direct deposit payment option for subsidized child care

Gov. Kathy Hochul has signed legislation requiring local social service districts to offer a direct deposit payment option for subsidized child care. Her team said this would modernize and streamline the system for social service payments to child care providers. The Office of Children and Family Services is required to issue these new regulations within one year of the signing of this legislation.

"Child care is key to our economic recovery from this pandemic, and this measure will expedite the delivery of funds to child care providers and alleviate the financial stress caused by potential delays in receiving subsidy payments," Hochul said. "We can't have a full economic comeback without boosting child care, and this legislation is another step in a series of bold initiatives I am leading to shore up child care programs statewide and to make quality, affordable child care available to all parents who need it."

Hochul’s team said, “Under the current system, many child care providers receive paper checks from their local social services districts as payment for care provided to children who are eligible to receive a subsidy. The printing and mailing of paper checks unnecessarily adds to the time it takes to process payments to providers, placing a financial strain on those who may already be living paycheck to paycheck. Direct deposit payments will eliminate this barrier to timely payment and remove an administrative burden, enabling child providers to focus on providing top quality early care for the children of New York.”

OCFS Commissioner Sheila J. Poole said, "Child care providers serving families supported by subsidy payments rely upon and deserve on-time payments to operate their businesses. It is essential that we do everything possible to promote the fiscal health of these vital child care programs. This is an important step in modernizing the system and eliminating an administrative hassle for child care programs and local social services districts alike. I commend Gov. Hochul for her leadership in supporting our child care providers and look forward to implementing this new legislation."

New York State Sen. Jabari Brisport said, "Child care workers are forced to navigate a patchwork system that puts a massive administrative burden on their shoulders and leaves them unsure if they can afford to keep their doors open. Creating a unified payment system that enables them to receive subsidy payments faster, without the hassle of paper checks, is an exciting first step towards addressing these underlying causes of the child care crisis. I am hopeful that this bill can be a springboard towards a fully Universal Child Care system that values child care workers' time and ensures they are justly compensated for their labor."

Assembly member Sarah Clark said, "Far too often, our child care providers work on some of the slimmest margins, and we don't need to exacerbate their struggles. Right now, providers must navigate an outdated process requiring subsidy payments to be issued in paper check form, arriving in the mail four to six weeks after submission. Our providers simply cannot afford to wait, particularly as they are also recovering from the pandemic. Allowing direct deposit for child care providers will ensure that those caring for our children have the resources that they need in a timely manner, and will allow them to focus instead on providing the highest quality of care for our children.”