The purpose of this hearing was to review the current sources of funding for child care and to consider how best to meet the child care needs of poor working families. Twelve legislators and expert witnesses presented oral testimony and four others submitted written testimony. Most witnesses stated their position on the following proposed legislation: (1) the Child Care Services Improvement Act; (2) the Choices in Child Care Act; and (3) the Act for Better Child Care (ABC). Summary recommendations include the following: (1) make funds available to parents to pay for quality child care and to child care providers to improve programs; (2) encourage differential funding of day care programs based on the age of the children; (3) form interagency agreements to provide social services, nutrition, family support, health, and mental health services for children in day care; (4) reduce the tax burden on families and allow them to apply federal child care vouchers with a minimum of government regulation; (6) provide additional funding for partnerships among day care providers; and (7) exempt religiously affiliated day care providers from federal licensing. Statistical data are included on three tables and eight graphs. (FMW)