Why Should Delaware Care?
As Delaware families grapple with rising costs, the House of Representatives members is considering two parallel bill that each would increase the Child and Dependent Care tax credits for those who are income-eligible.
Two pieces of legislation that would each expand tax credits for Delaware parents have seen action in the statehouse in recent weeks.
One is a Democratic bill that proposes to double the amount of money that parents could receive from a Delaware childcare tax credit. The other, which has bipartisan sponsors, would expand the credit for lower-income parents and allow them to redeem more money than they pay in.
The sponsors of each bill says their measure is designed to ease the burden of inflation on working families. Both bills have also received backing from various business groups.
While neither proposal has drawn outright opposition, there is uncertainty around whether either will pass during what is expected to be a hard-fought budget season.
Rep. Melanie Ross Levin (D-Brandywine Hundred) first introduced House Bill 274 in January as a means to ease financial pressure on parents in need of childcare.
Last month, a revised version of her bill – which would increase Delaware’s match of the federal Child and Dependent Care Credit from 50% to 100% – passed the House Revenue and Finance Committee.
The federal Child and Dependent Care Credit allows working parents to reduce their tax liability if they pay for childcare.
During testimony at the committee hearing, Ross Levin noted that her proposal was not in Gov. Matt Meyer’s recommended budget in January. Still, she called the bill “fiscally, potentially doable,” noting that the credits are designed so that taxpayers do not receive more cash from the government than what they pay in taxes.
Ross Levin also said her bill is not a silver bullet to fix rising costs for parents, but noted she has a “few other childcare bills up my sleeve.”
Following the testimony, several lawmakers expressed general support for the bill. None voiced opposition to it. The bill, if passed, would cost the state government more than $6 million annually, according to legislative estimates.
Also awaiting consideration in the same committee is House Bill 284.
Sponsored by Rep. Lyndon Yearick (R-Dover), the bill would double the childcare and dependent care expense tax credit for single individuals with an income of less than $60,000 and would make the credit refundable – meaning beneficiaries could receive payments even if they own little in taxes.
Married couples with an income of less than $120,000 would also be eligible for the increase. The tax credit would remain the same for those who earn more.
But because of its refundability, Yearick’s bill is likely to be more expensive for the state than Ross Levin’s parallel legislation. Delaware’s legislative staff members have not yet publicly posted its estimated cost to the state.
Late last month, Yearick introduced a substituted version of the bill, which now awaits consideration.
In an interview, Yearick said his bill is designed to attract “a qualified workforce” to the state by making childcare more accessible to parents who do not qualify for programs, such as Purchase of Care or Head Start.
Among the additional and co-sponsors of the bill are two Democrats — Rep. Alonna Berry (D-Milton) and Sen. Kyra Hoffner (D-Leipsic).
Both Yearick’s and Ross Levin’s bills have gained support from the Delaware Association for the Education of Young Children. In a statement, the association’s president, Kim Bryda, said she appreciates the bills’ focus on early care and education affordability, but asserted that “families need relief on a daily basis.”
Other leaders in Dover have not yet made their stances publicly known.
A spokeswoman for Democrats in the House of Representatives said lawmakers will examine both bills in a “holistic manner” to ensure the best option is put forward.
“We look forward to continued discussions on both pieces of legislation,” the statement said.
A spokeswoman for Delaware’s Senate Democrats declined to comment for this story.
