The proposal expands the state subsidy program first enacted in 2018, by more than doubling the maximum family income limit from $60,000 to $150,000–but only for the 2021 tax year.
Lawmakers introduced the bill in early November at the start of the lame duck session. The measure was approved in the state Assembly on Dec. 2 by a 77-0 vote and the state Senate that same day in a 35-0 vote. Gov. Phil Murphy approved it less than a day afterwards.
Upwards of 88,000 additional New Jersey families could benefit by the expansion of the tax subsidy program, according to a Dec. 2 statement from the Assembly Democrat’s Office.
Proponents of the measure contend that anything that increases access to child care is vital, especially at a time when lack of access creates a barrier to getting workers – especially women – back into the workforce.
According to a Dec. 2 statement from the Assembly Democrat’s Office, more than 88,000 additional families could benefit from the expanded tax subsidy program. – EDWIN J. TORRES / NJ GOVERNOR’S OFFICE
“This legislation will help ensure affordable access to childcare, a critical part of getting hardworking New Jerseyans back into the workforce and reversing the ‘she-cession’ caused by the pandemic,” Murphy said in a prepared Dec. 3 statement accompanying his announcement of the bill’s enactment.
Under the expansion, claimants could also get the tax credit refunded, meaning they can exchange it for cash, if the credit they get is larger than their tax bill.
The new law scraps the $500 cap on tax credits that someone can claim for caring for just one person, and the $1,000 cap for two or more people.
“This bill will help improve access to child care, which will help the industry and an entire workforce that relies on child care,” said Alexis Bailey, who heads government affairs for the New Jersey Business & Industry Association, in a statement.
With the hiring shortage plaguing businesses as they attempt to recover from the pandemic, and “our participation rate among female workers … at its lowest points in decades,” Bailey continued, “any legislation like this that can increase child care access will help our state.”
She estimated that upwards of 19% of mothers with toddlers and infants left the New Jersey workforce amid the COVID-19 pandemic because of child care issues.
“Over the pandemic, major child care issues have been exacerbated. With parents rapidly returning to work while the pandemic continues, child care is now more important than ever,” reads an added statement from one of the main sponsors, Assemblywoman Gabriela Mosquera, D-4th District.
“Allowing families to reclaim some of their money spent on child care will enable parents to transition back to work with one less thing to worry about,” she added.
The bill’s enactment will cost the state $76.2 million this year, according to a fiscal analysis by state’s the nonpartisan Office of Legislative Services.
“The expanded credit is a critical lifeline for families struggling to care for the state’s youngest children — and a step toward making this a more just and equitable state that treats working people with dignity,” reads a statement from Peter Chen, a senior policy analyst with the progressive think tank New Jersey Policy Perspective.
State officials have tried other means to subsidize the state’s child care industry, such as a $700 million pot of money that subsidizes the costs both for the child care center, and for parents.[/vc_column_text][/vc_column][/vc_row]
1 of 1 article
0 articles remaining
Advance your business edge with news from NJBiz. Register now for more article access.
