Republicans maintain skepticism for most of Evers’ workforce agenda at Senate hearing

Child care, family leave programs are on the line in special session legislation

By: - October 12, 2023 5:45 am
Preschool children playing with colorful shapes and toys in a child care center

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A parade of witnesses urged state senators Wednesday to preserve child care support that began during the COVID-19 pandemic but was cut from Wisconsin’s two-year budget enacted in July.

Restoring the Child Care Counts program dominated the three-and-a-half hour hearing before the Senate Committee on Economic Development and Technical Colleges, held to consider legislation that Gov. Tony Evers proposed in August and scheduled a special session for Sept. 20 for the Legislature to take up. 

But the committee also heard testimony in support of a paid family leave proposal, more funding for the University of Wisconsin and a series of workforce development programs.

The Evers administration has billed the $1.4 billion proposal, Special Session Senate Bill 1, as a comprehensive package to address Wisconsin’s persistent challenges in filling job openings. 

“There are more jobs than physical bodies to currently fill those jobs,” said Amy Pechacek, the Department of Workforce Development (DWD) secretary-designee.

“Wisconsin’s economy has been on a winning streak,” Pechacek said, with record-low 2.4% unemployment in May, record-breaking job creation and the low number of unemployment insurance claims. But many employers remain “anxious about their ability to fill jobs,” she added, warning that as the state’s population ages into retirement, those challenges would persist. 

The proposal includes: 

  • $365 million to continue Child Care Counts, which provided monthly payments to child care providers that were credited with holding down parent fees while boosting wages for historically low-paid child care workers. Part of that money would also extend a related program that provided subsidies to employers who subsidized child care costs for their employees.
  • Creation of a new paid family leave program, funded by payroll deductions and given a one-time state infusion of $243.4 million to allow the program to be implemented sooner.
  • More than $330 million in additional higher education funding, for the University of Wisconsin System, the Wisconsin Technical College System and private nonprofit colleges and tribal colleges.  
  • More than $150 million  for a series of workforce related programs, including programs to bolster the health care workforce and additional teacher training.

To date, Republican leaders have publicly expressed no support and little enthusiasm for any of the items in the Evers package. 

On Wednesday, the three Republicans on the committee gave their friendliest response to Ian Robertson, the University of Wisconsin engineering dean, who made a pitch for a proposed new UW engineering building. The $197 million item was cut from the 2023-25 budget in June and accounts for a little less than two-thirds of the higher education funds in the special session legislation.

“I need more faculty. I need more staff,” Robertson said. “But most importantly, I need the space for those faculty, those staff to work to educate the students.”

“I have taken a tour” of the existing College of Engineering, said Sen. Dan Feyen (R-Fond du Lac), the committee chair, “and it shows why there’s a need as well.”

Paid family leave

Many of the questions that GOP lawmakers posed Wednesday for other witnesses were skeptical about the rest of the proposals, however.

DWD Secretary-designee Amy Pechacek speaks at Wednesday’s public hearing for Gov. Tony Evers’ special session workforce proposals. (Screenshot | WisEye)

Pechacek focused much of her testimony on the family leave program — a measure that she said would help more workers stay “attached to the workforce” after taking time off for childbirth, illness or care for a loved one. The program would be funded by payroll deductions, with employers and employees each contributing less than half of 1% of an employee’s paycheck. 

Some 14 states, including Minnesota and Illinois, have begun paid family leave programs, Pechacek said. She cited studies that found reduced turnover, better employee retention, reduced poverty, better corporate performance and improved mental health for parents where the programs have been in place.

Sen. Dan Knodl (R-Germantown) told Pechacek that credit for the state’s job growth belongs to “the private sector.” He added, “My concern comes when the government steps in and doesn’t need to.” 

Knodl suggested that the payroll deduction requirement would “penalize” employers for hiring people, then asked whether Pechacek would favor, for “able-bodied adults, that we mandate upon them that they must enter the workforce if they’re receiving any other type of benefits?”

Pechacek responded that her agency’s principal program, unemployment insurance, already requires work searches and registering with state job centers. 

Sen. Rob Stafsholt (R-New Richmond) questioned whether allowing both parents in a household to take time off under the family leave program would exacerbate labor shortages. 

Pechacek said that fewer than 2% of employees each year were expected to use the program; at the same time, it “would apply to anyone who’s contributing towards the program.”

Deb Standridge, deputy secretary at the Department of Health Services (DHS), urged lawmakers to consider the need for future health care workers, including a projected shortage of some 20,000 nurses by 2040. Other medical professionals, including doctors in specialties “across the board” are also in short supply, she said.

Provisions in the bill for specialized workforce grants totaling about $60 million in health care build on previous programs, some started during the pandemic with federal funds, that “have an established record of success in promoting and growing our health care workforce,” Standridge said. 

“We need to figure out how to open up the pipeline” to bring more people into the health care field, both as workers but also “people who will train them on the job,” Standrich said. “So that’s part of what’s in this” legislation.

Child care support

The balance of the hearing focused on child care support. Witnesses described how the $20 million-per-month Child Care Counts program that started during the pandemic had stabilized the state’s licensed child care providers. To stretch the funds into January, the Department of Children and Families (DCF) cut the program’s monthly payments in half in June.

“These federal dollars helped keep childcare professionals in the early childhood workforce by supplementing and increasing the wages — important for this field that continues to struggle with woefully low compensation,” said Paula Drew, representing the Wisconsin Early Childhood Association.

“At its very core supporting childcare is what’s best for young children because it gives them education and care in their earliest years,” she added. Drew referred to economic projections that Wisconsin loses $1.9 billion a year in productivity because parents can’t find child care, and a recent report that found women’s labor force participation fell below 60% in 2022.

“Without action more educators will leave programs. childcare programs will continue to raise parent fees, and an increasing number of programs will make the difficult decision to close their doors,” Drew said.

The Child Care Counts program has been paid to providers across the board. Stafsholt asked Drew whether the money should be directed specifically to facilities serving lower-income families, and questioned why providers don’t raise their rates.

“Child care tuition rates, on average, are not what it costs to provide care,” Drew said. “It’s what the market will hold. Many people don’t raise rates because they are afraid that parents won’t be able to cover those costs.”

Feyen asked whether there were “any long-term solutions” to bridge the gap between the cost of care and what families will pay, “other than just keep throwing more state money at it every two years?”

“If there was a different solution, we would have come up with it,” Drew replied, noting that WECA has been around for 50 years. “This market just doesn’t bear the costs of providing care and education for young people who need quality interactions to develop, fully develop, into folks that are going to one day be working all sorts of jobs in Wisconsin.”

Corrine Hendrickson, a family child care provider and cofounder of a child care advocacy group, Wisconsin Early Childhood Action Needed (WECAN), said that even for families with above-median incomes, child care costs are well above what analysts have considered affordable. 

“Affordable care is considered 7% of household income,” she said. “Most pay about 14% per child.” For a family with an income of $130,000 a year, $175 a week reaches the 7% threshold. “And that’s just with one child.”

For parents who drop out of the workforce because they can’t find child care, “that affects their ability to move up the ladder,” Hendrickson said.

Child care economics ‘do not work’

Sen. Brad Pfaff (D-La Crosse) said what providers were telling the committee  resembled  his own family’s experience. “What I struggle with, I’ll just say it, is that the economics of child care do not work,” he said. “That’s why I support the Child Care Counts. Because I want to be able to keep independent operators, small business people like yourself, who know your community, and know the families in your community.”

Caitlin Mitchell, a child care provider in Bloomer, referred to a group of bills that Republicans advanced in September that included increased ratios of children to teachers and lowering the minimum age for starting child care workers to 16. Providers “need to be able to pay our teachers a living wage,” she said, and those bills were not responsive. 

“The infamous party line we keep hearing from the Republicans is we must find a long-term solution, we must get to the root of the problem,” Mitchell said. “But maybe the root of the problem is that there is no investment. Why can’t the fundamental problem be that this broken industry has never had consistent, dependable funding?”

Knodl asked Mitchell why she couldn’t raise rates to pay her workers more rather than relying on “government dumping money into your business?”

Mitchell said that she raised her rates 20% in June and will raise them another 20% in January when the last of the Child Care Counts funds end — a total increase of $70 a week per child on average.

“But eventually, you can’t just continue to raise rates and ask parents to continue to give them more of your paycheck,” she said, “because then they have to decide between paying childcare or leaving the workforce entirely to stay home with children. And then we lose people in the workforce.”

“You’re not saying it’d be a bad thing for that child to spend more time with their parents?” Knodl asked. 

“Absolutely not,” Mitchell replied. “But not all households can afford to live on a single income.”

Health and safety

As Sen. Dan Knodl watches and a group of child care providers look on, Cottage Grove child care provider Linda Kudrna testifies Wednesday at a Senate public hearing on legislation to extend support for child care over the next two years. (Henry Redman | Wisconsin Examiner)

When Linda Kudrna, a Cottage Grove child care center operator, said converting rooms in her center to accommodate more infants and toddlers, for whom there’s a long waiting list, was impractical due to stricter requirements for those youngest children, Knodl asked whether “government regulations are actually keeping you from [growing].”

“The building codes for some classrooms will not allow infants and toddlers to be in that classroom,” Kudrna said.

“Would you be able to outfit that classroom adequately, do you think, if those government regulations weren’t in place?” Knodl asked.

Those rules, Kudrna said, are “for health and safety reasons,” and remodeling the space could cost “hundreds of thousands of dollars.”

Hendrickson testified that child care providers don’t favor relaxing regulations that are in place to protect children.

“If we changed some of those health and safety regulations, your fire department’s going to be in here tomorrow and telling you, no way are they going to allow you to put four infants in a room upstairs with no sprinkler. It’s not acceptable,” she said. “And that shouldn’t be acceptable to any of you.”

Emily Amundson, secretary of the Department of Children and Families (DCF), said that “we’re hearing what’s happening around the state as programs are grappling with that reduction” of the Child Care Counts funding in June.

“We’re in innovative territory when it comes to what is the right amount of funding that is going to stabilize the industry? And what’s that right amount of funding that is going to allow us to strengthen and then really go the distance in providing high-quality care for every single family that needs and wants it,” Amundson said.  

Knodl said he saw no need for such assistance.

“What has saddened me today is the loss and lack of faith that appears we have come to have in our individuals, our fellow Americans — that they can’t step up and take on these responsibilities, just throwing hands up in the air, and saying there’s a lack of faith in the parent or individual,” Knodl said.

“And when parents, or two parents, single parents or partnerships come together to raise a family and provide for them, I think we would be amazed at the lengths they can go to, the things they can accomplish.”


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Erik Gunn
Erik Gunn

Deputy Editor Erik Gunn reports and writes on work and the economy, health policy and related subjects, for the Wisconsin Examiner. He spent 24 years as a freelance writer for Milwaukee Magazine, Isthmus, The Progressive, BNA Inc., and other publications, winning awards for investigative reporting, feature writing, beat coverage, business writing, and commentary.