The Senate on Monday unanimously passed a bill that would phase out child care assistance rather than abruptly ending it when a family’s income increases.
The House in February also unanimously passed House File 302, which now heads to the governor’s desk.
The graduated phase-out, which would set assistance from the Iowa Department of Human Services based on family income compared to poverty levels, would be implemented by July 2022. DHS would set rules setting the specifics of the phase-out.
Business groups have long pushed for legislation to help with the “cliff effect,” in which a family member could lose child-care benefits by taking a job or earning a promotion. In many such cases, the family income is still low enough to force the family to struggle financially, business leaders have said.