Ragan Report

Ensuring childcare is affordable for working families

The Legislature is narrowing its focus to bills with the greatest bipartisan support in what is known as the "second funnel.” Funnels are self-imposed deadlines to keep the legislative process moving. With the second funnel, a bill must be approved by the House or Senate and by a committee in the other chamber to remain eligible for consideration throughout the rest of the session.  

One piece of legislation that will go forward helps working families afford child care. Iowa is third in the nation for the number of households with children under the age of six in which both parents work; this means Iowa families need good childcare, which comes at a high price.

As we look at ways to strengthen Iowa's middle class, it makes sense that families be able to afford childcare that allows them to work and advance in their careers. We are fortunate to live in a state with a relatively strong economy and low cost of living. Still, one in four Iowa families does not earn enough cover their basic needs.

Iowa's working families can benefit from our state's child and dependent care tax credit. To be eligible, all parents in a household must work and incur eligible childcare expenses. Iowa’s state credit builds on the federal tax credit, offering an additional boost to working families. The federal credit allows working families to deduct 20 to 35 percent of their eligible expenses from their taxes, with a maximum credit of $3,000 for one child and $6,000 for two or more children.

Unfortunately, the benefit from Iowa’s state tax credit has eroded over time. SF 2337 will improve our state's child and dependent care tax credit by allowing Iowans to claim a state credit of up to 93.75 percent of the federal credit, increasing income eligibility from $45,000 to $67,410 and indexing for inflation. The bill extends eligibility to an additional 40,000 households, helping more families afford the childcare they need to work and succeed.

Upcoming public forums

• Saturday, March 15, 10 a.m.: Listening Post at Mason City Public Library, 225 Second Street SE in Mason City

• Friday, March 21, 10 a.m.: Legislative Forum at Clear Lake Bank & Trust, 322 Main Avenue in Clear Lake

This is a legislative column by Senator Amanda Ragan, representing Franklin, Butler and Cerro Gordo counties. For newsletters, photos and further information, go to www.senate.iowa.gov/senator/ragan.

To contact Senator Ragan during the week, call the Senate Switchboard at 515-281-3371. Otherwise she can be reached at home at 641-424-0874. E-mail her at amanda.ragan@legis.iowa.gov.

Senator Ragan is an Assistant Senate Majority Leader, chair of the Human Resources Committee and vice-chair of the Health & Human Services Budget Subcommittee. She also serves on the Appropriations, Natural Resources & Environment, Rules & Administration and Veterans Affairs committees.