Mayor Watson Proposing City Grants for Child Care Providers in Austin

Grants in Tandem with Proposed County Tax Vote

Mayor Kirk Watson voiced support on Thursday for a proposed grant program for home-based child care providers across Austin, alongside a countywide effort to address affordability issues in the area. Speaking at a summit reviewing potential solutions for the city’s affordability problem, Watson indicated that child care, along with housing and transportation costs, are the primary expenses making Austin unaffordable for many lower and middle-income households.

Addressing Affordability Issues with Social Determinants

Amidst affordable housing bonds and Project Connect targeting the first two affordability aspects, Watson emphasized the need for the city and Travis County to work together to increase the number of child care providers in the area. Recent data shows a substantial 40% annual turnover rate for child care providers in Austin, causing consistent scarcity and rising costs.

Following the city’s participation in a state program providing a 100% property tax rebate for commercial properties owned by child care operators, Watson suggested the next step should be support for home-based providers ineligible for the state’s initiative. Adrienne Sturrup, director of Austin Public Health, and Sylnovia Holt-Rabb, director of the Economic Development Department, recommended in a memo last month creating a new grant program to reduce property taxes for home-based providers.

Proposed Solutions and Potential Impact

City data indicates that 21 current providers would meet the four criteria for enrollment in such a program, with yearly exemptions ranging from $856 to $2,821, at a total city cost of $33,122. APH is considering other support methods, including a grant program from the national Home Grown child care collective that could award an additional $150,000 for qualifying providers, with half of that money coming from the city budget.

Tax Referendum to Expand Child Care

Earlier this month, the Travis County Commissioners Court initiated the process of placing a ballot referendum before voters in November which could raise $77 million annually to expand child care availability and a variety of after-school programs. If passed, this initiative would lead to a 2.5-cent property tax increase per $100 of a home’s assessed value. The Commissioners Court plans to approve the election later this summer.

Watson applauded the county for taking steps to address child care issues while the city has been working to incorporate child care provisions into relevant policy, noting that solving the child care issue must be a countywide approach due to migration out of the city. “We want to make sure we’re addressing people that will need it for affordability purposes.” Watson said.