Alaska proposes raising child care assistance income limit to 105% of state median

Working families earning up to 105 percent of Alaska's state median income could qualify for child care assistance, if they meet other program requirements, under regulation changes proposed by the Alaska Department of Health. The current income ceiling is 85 percent.

The proposal creates a new assistance category, PASS V, for families with income between 86 percent and 105 percent of the state median income. It also raises the income threshold used during the 12-month eligibility period to that same 105 percent figure. A second new category, PASS IV, would cover children receiving child protective services through the Office of Children's Services. Together, the changes expand the Parents Achieving Self-Sufficiency program from three categories to five.

The department describes the package as changes to regulations governing child care assistance provider rates and family contributions.

The notice states the changes are not expected to require an increased appropriation. Federal guidance for the Child Care and Development Fund states that a family's income cannot exceed 85 percent of the grantee median income to qualify for that funding stream. Families above that line would need support from another source.

Cost estimates for the same expansion have circulated before. At a June 5, 2025 meeting of the Anchorage ACCEE Fund Board, Zack Fields put the annual price at more than $6 million. "The cost of the expansion from 85 to 105% state median income is over $6 million a year," Fields said. "So it's a meaningful increase in support for childcare." The notice does not address that estimate or explain how it fits with the department's statement that no increased appropriation is expected.

The underlying policy is not new. The Prenatal-to-3 Policy Impact Center reported in October 2024 that Alaska had enacted legislation raising the eligibility limit to 105 percent of state median income. The 2025 Prenatal-to-3 Policy Roadmap described that expansion as effective January 2026, pending federal approval of a Child Care and Development Fund state plan amendment. The proposed regulations would write that change into administrative code.

A 2024 analysis by McKinley Research Group found Alaska providers are reimbursed about 45 percent of the true cost of infant care in centers. Early childhood policy analysts have warned that expanding eligibility without additional funding could strain providers and the families who rely on them, since subsidy rates already lag behind the true cost of care.

Written comments go to [email protected] and must arrive by 5 p.m. Sept. 14. A telephonic hearing is set for Aug. 26 from noon to 1 p.m. Accommodation requests are due to Karen Benson by Aug. 18.