Child Care and Nutrition Enhancement Act of 1988

Child Care and Nutrition Enhancement Act of 1988 - Title I: Child Care Grant Program - Authorizes the Secretary of Health and Human Services (the Secretary) to make formula grants to States for authorized child care related activities under an approved State plan.

Authorizes the Secretary to make competitive grants to eligible child care providers for such authorized activities under an approved application.

Authorizes appropriations for FY 1989 through 1991 to carry out this Act (with a separate amount authorized for competitive grants).

Directs the Secretary to reserve a portion of such funds for payments to specified U.S. territories and possessions. Directs the Secretary to allot the remainder to each State according to a formula based on the number of single parents and dual-earner family members with children under age 13. Sets forth requirements for use of most recent data and for reallotment.

Defines eligible providers as: (1) local governments; (2) local educational agencies; (3) nonprofit organizations, including certain tax-exempt organizations; (4) professional or employee organizations; (5) consortia of small businesses; (6) institutions of higher education; (7) hospitals or health facilities; (8) family child care providers who would qualify for assistance under the Child Care Food Program under the National School Lunch Act; or (9) entities which the State determines are able and appropriate to carry out a project assisted under this title.

Authorizes use of grants under this title for: (1) provision of child care services to low- and moderate-income parents (including use of appropriate fee schedules); (2) resource and referral centers (including information, training, and recruitment activities); (3) programs to increase child care slots for infants, handicapped children, and minority children; (4) neighborhood child care centers, after-school child care programs, and startup costs of onsite child care at small businesses; (5) recruitment and training of senior citizens to serve as child care workers; (6) assistance to eligible providers and family-based child care providers to meet State licensing standards; and (7) coordination of programs assisted under this Act with State or federally-assisted child care programs, including Head Start, education of disadvantaged children in elementary schools, preschool programs, and handicapped children programs, in order to extend the program hours of child care services.

Sets forth requirements for State plans to be carried out by designated State agencies.

Sets forth requirements for applications, by eligible providers for grants from States under this title. Requires States to give priority to programs that significantly expand or improve provision of child care services to children of low- and moderate-income parents.

Directs the Secretary to make competitive grants from specified funds to eligible providers for: (1) the establishment and operation of after-school child care programs; and (2) the coordination of programs assisted under this title with child care programs assisted by the State and with federally-assisted child care programs (including Head Start, Federal assistance for education of disadvantaged elementary school children, preschool children, preschool programs, and programs for handicapped children), designed to improve the operation of such a program with respect to hours of operation for child care services. Requires the Secretary to give priority to projects of national significance and projects which when replicated will further the objectives of this Act.

Requires the designated State agencies to evaluate assisted projects biennially, make such evaluations public, and report to the Secretary on them. Requires the Secretary to summarize the evaluations in the annual report of the Department of Health and Human Services to the Congress.

Sets forth provisions for payments to, and expenditures by, States and eligible providers under this title.

Title II: Child Care Food Program - Amends the National School Lunch Act to allow reimbursements under the Child Care Food Program for up to two meals and two supplements or one supplement and three meals per day per child.

Amends the Child Nutrition Act of 1966 to increase by three cents the reimbursement for each breakfast served under the School Breakfast Program and the Child Care Food Program.

Title III: Child Care Homes Tax Credit - Amends the Internal Revenue Code to establish a child care homes tax credit. Grants home providers of such care a credit for expenditures to acquire, construct, rehabilitate, or expand a qualified child care home to meet State or local requirements. Sets such credit at 20 percent of up to $5,000 of such expenditures per year. Applies the credit to taxable years beginning after December 31, 1988, on expenditures made before December 31, 1993.

Title IV: Employer On-Site Child Care Facility Credit - Amends the Internal Revenue Code to allow a tax credit for employer expenditures for certain on-site child care facilities. Sets such credit at 25 percent of up to $400,000 of expenditures per year. Provides the same credit to groups of businesses which cooperate to establish an off-site child care facility. Applies the credit to taxable years beginning after December 31, 1988, on expenditures made before December 31, 1993.

Title V: Dependent Care Services Tax Credit - Amends the Internal Revenue Code to provide for a phase-out of the dependent care services tax credit for higher income households (i.e. one-child households earning between $35,000 and $45,000, and two-or-more-children households earning between $45,000 and $55,000.)

Makes the dependent care services tax credit refundable.

Title VI: Child Care Study - Directs the Secretary, within 90 days after the enactment of this Act, to prepare and submit to specified congressional committees a report that: (1) describes the demographic and societal trends that are increasing the need for child care; (2) describes the reasons for the greatly increased need for child care; and (3) develops recommendations for joint efforts by Federal, State, and local governments targeted towards enabling parents to care for children in their own homes.