State lawmakers pass bill to expand tax credits to help lower income families pay for childcare

Colo. ranks among the most expensive for childcare
Posted at 5:07 PM, May 29, 2018
and last updated 2018-05-29 20:15:16-04

DENVER -- Colorado Governor John Hickenlooper recently signed a bill into law aimed at making childcare more affordable for lower-income families.

"It was crazy. It was like, 'wow!' For me it was too much," said mother of two, Lucrecia Escobedo, who lives in Globeville.

Like many working moms, Escobedo said she was priced out of the childcare puzzle and staying home with her young son made more sense financially than paying for full-time care.

"I could use that money for something else. Either diapers, food, or something else that would help my family," she said.

"People actually pay more for childcare costs each month than they do in their rent or their mortgage," said Christina Walker, a policy manager for Clayton Early Learning in Denver.

Lawmakers passed HB 1208 during the 2018 legislative session to help lower income families like Escobedo. The bill expands a state tax credit for Colorado families making $60,000 a year or less.

Right now, a working family in Colorado claiming the max cap of $3,000 in childcare costs only gets 10 percent back from the state at tax time or $300.

Under the new law, those same working parents will get 50 percent back from the state which increases the yearly credit to $1,500.

"It will give working families a little bit extra money at the end of the year to be able to have a little bit more disposable income," said Walker.

"I could use it to pay for childcare, and I could go to work full time get a little more income," said Escobedo.

For Escobedo, the extra money could help her finally get her GED or start a new career. Currently, her best option is working part-time at the only job she could find where they let her bring her two-year-old son to work.

"I have to answer the phone, and he's like 'mommy, mommy,' and I'm trying to see what they want. That's probably the hardest part," she said.

Colorado continually ranks among the least affordable for licensed care. On average, child care centers cost nearly $15,000 a year for infants and $11,000 for preschoolers, according to Child Care Aware of America.

"This bill is one piece of the puzzle, but the puzzles very big and we're continuing to think about ways we can piece everything together," said Walker.

The new revenue is coming from the controversial Republican tax reform bill passed late last year.

Walker said they wanted the credit to go further, and raise the cap for Colorado families making $150,000 a year or less but call the bill a step in the right direction.