Federal Funding Streams

Funding for early child development and learning initiatives is available to states through various federally funded programs. Federal dollars typically flow to the state in one of two ways:

  1. A designated state agency charged with administering an early childhood program receives the federal funds (e.g., child care subsidy) or
  2. Federal dollars go directly to providers of early childhood services at the local level (e.g., Head Start).

Federal Funding Sources

Federal ProgramOverviewAdministratorFlow of Federal Funds
Child and Adult Care Food Program (CACFP)CACFP provides subsidized food service to children under 12, migrant children 15 and younger, children 18 and under in the Area Eligible Snack Program and in emergency shelters, children with special needs in child care centers or day care homes through age 18 as well as adults 60 and older enrolled in an adult care center.U.S. Department of Agriculture, Food and Nutrition ServiceFederal funds go to the NC Department of Health and Human Services,Division of Public Health. The Division provides reimbursement to qualified caregivers.
Child Care and Development Block Grant (CCDBG), also referred to
as the Child Care Development Fund (CCDF)
It is the primary source of federal funding for child care subsidies for low-income working families. It also provides funds to improve child care quality.US Department of Health and Human Services, Office of Child CareFederal funds go to the NC Department of Health and Human Services, which then pays according to NC law-regulated child care centers and child care homes in local communities.

In FY 2014, an average of 65,600 children were served each month.
Head Start/Early Head StartHead Start is a federally funded preschool program that provides comprehensive services to support the social, emotional, physical and cognitive development of three and four–year-old children. Early Head Start serves infants and toddlers.US Department of Health and Human Services, Office of Head StartFederal funds go directly to local Head Start grantees.

For FY 2015, Head Start served 23,088 North Carolina children. For FY 2015, Early Head Start served 5,147 children.
Temporary Assistance for Needy Families (TANF)TANF is designed to help low-income families achieve self-sufficiency. States receive block grants to design and operate programs that focus on parental employment and child and family well-being.US Department of Health and Human Services, Office of Family AssistanceNorth Carolina’s TANF program is called Work First. North Carolina transfers some TANF dollars to child care subsidy.

Federal funds go to the NC Department of Health and Human Services, Division of Social Services.

TANF is operated at the local level by county Departments of Social Services.
The Special Supplemental Nutrition Program for Women, Infants and Children (WIC)WIC supports the health of low- income pregnant, post-partum and breast-feeding women; and infants and children up to age ve who
are at nutritional risk. It provides nutritious foods to supplement diets, information on healthy eating and referrals to health care.
US Department of Agriculture, Food and Nutrition ServiceFederal funds go to the NC Department of Health and Human Services, Division of Social Services.

WIC is operated at the local level by county Departments of Social Services.
IDEA Section 619 Preschool Funding (Special Education Preschool)DEA Section 619 awards formula grants to states, the District of Columbia and Puerto Rico to make available special education and related services for children with disabilities aged three through five.US Department of Education, Office of Special Education ProgramsFederal funds go to the NC Department of Public Instruction, Office of Early Learning

NC is required to distribute most of its grant to local educational agencies, which operate local programs.
IDEA Part C - Grants for Infants and Toddlers (Special Education Early Intervention Services)IDEA Part C awards formula grants to assist states and territories in implementing statewide systems of coordinated, comprehensive, multidisciplinary, interagency early intervention
programs and making early intervention services available to children with disabilities, age birth through two.
Department of Education, Office of Special Education ProgramsFederal funds go to the NC Department of Health and Human Services, Women’s and Children Health section and are administered by the state’s Children’s Developmental Services Agency.
Supplemental Nutrition Assistance Program (SNAP)SNAP o ers nutrition assistance to eligible, low-income individuals and families and provides economic benefits to communities.US Department of Agriculture, Food and Nutrition ServiceFederal funds go to the NC Department of Health and Human Services, Division of Social Services.

SNAP is operated at the local level by human services agencies.
Maternal Infant, and Early Childhood Home Visiting Program (MIECHV)MIECHV supports pregnant women and families and helps at-risk parents of children from birth to kindergarten entry access resources and develop the skills needed to raise physically, socially and emotionally healthy children.US Department
of Health and Human Services, Health Resources and Services Administration, Maternal and Child Health Bureau
Federal funds go to NC Department of Health and Human Services, Women’s and Children Health section. Through a Request for Proposals, communities are selected to implement home- visiting programs.

MIECHV is operated at the local level through initiatives such as Nurse Family Partnership and Parents as Teachers.
Race to the Top - Early Learning Challenge Grants (RTT-ELC)RTT-ELC grants were awarded to states on a competitive basis between 2011 and 2013 for development of a statewide infrastructure of integrated early learning supports and services for children, from birth through age five.US Department of Education, O ce of Early Learning and the Department
of Health and Human Services, Administration for Children and Families, Office of Early Childhood Development
NC was awarded a five-year grant of $69.9 million.

The lead state agency is the Early Childhood Advisory Council within the Office of the Governor.

The NC Department of Health and Human Services, Division of Child Development and Early Education is the fiscal agent.
Promise NeighborhoodsPromise Neighborhood grants are awarded competitively to provide funds to non-profit, community- based organizations to support development of comprehensive neighborhood programs, modeled after the Harlem Children’s Zone, designed to combat the e ects of poverty and improve education and life outcomes for children, birth through college.U.S Department of Education, Office of Innovation and Improvementn/a
Preschool Development GrantsPreschool Development Grants are competitively awarded to support states to build or enhance preschool program infrastructure to enable the delivery of high quality preschool services to children.US Department of Health and Human Services, Administration for Children
and Families in coordination with the Department of Education, Office of Early Learning
n/a
Every Student Succeeds Act (ESSA)ESSA ensures each child has the opportunity to receive equitable, high-quality education, and close achievement gapsU.S Department of EducationFederal funds go to the NC Department of Public Instruction and are distributed to Local Education Agencies.

Earned Income Tax Credit

The Earned Income Tax Credit (EITC) is a federal refundable tax credit for low- and moderate-income working people. It encourages and rewards work as well as offsets federal payroll and income taxes. For tax year 2015, more than 931,000 North Carolinians claimed the federal EITC, worth a total of $2.3 billion.” (National Conference of State Legislators)

The federal EITC lifted approximately 298,000 North Carolinians—half of whom were children—above the federal poverty line between 2010 and 2012. (Brookings Institution. “State Estimates of People and Children Lifted out of Poverty by EITC and CTC per Year, 2010-2012.” 2014.) In 2007, state lawmakers established a state EITC to build upon the federal tax credit and provide a modest boost to the wages of low- and moderate-income North Carolina workers. In 2013, state lawmakers eliminated the state EITC, making North Carolina the first and only state with an EITC to eliminate the tax credit. For tax year 2013, more than 927,000 North Carolinians claimed the state EITC, benefiting more than 1.2 million children. (Budget and Tax Center)