Budget reality check: Child care a priority while ESA reform a pipe dream

Why it matters: Child care disruptions cost Arizona families $3 billion in lost earnings and cost businesses nearly $1 billion in lost revenue and increased hiring costs annually, per the governor's office.

How it would work: Hobbs' Bright Futures AZ plan creates several new child care programs:

• A $3 million public-private partnership in which businesses and the state would pay one-third the cost (up to $400 monthly) of an employee's child care for kids five and younger.
• $1 million in tax credits to help businesses pay for employees' child care, with individual businesses qualifying for $100,000 maximum.
• A $3 million grant program available to school districts, nonprofits and child care providers to create new slots for kids ages 5-12 after school and during the summer.f
• $3.5 million in one-time federal funding to help child care providers get licensed.

By the numbers: The programs are expected to fund child care for 5,000 children and create 4,000-5,000 new child slots, in addition to the tax credit program for businesses.

1 big pipe dream: While the governor's budget plan is a starting point for discussions with the Legislature, at least one proposal will almost certainly be non-negotiable. Hobbs proposed an Empowerment Scholarship Accounts (ESA) reform that would impose a scaled income cap on the voucher-style program for K-12 education.

• Families earning more than $130,000 would get 75% of the ESA funds they currently qualify for, with that dropping to 50% for incomes over $160,000 and 25% for up to $200,000.
• If a family earns more than $200,000 annually, they would no longer be eligible.

The bottom line: Republican lawmakers have generally considered ESAs to be a third rail and are extremely resistant to Democratic proposals to eliminate or curtail the 2022 expansion of the program.