What's New in Child Care Legislation and Policy?
Child care is one of the hottest topics in public discourse today, and for good reason. The sector is finally (if a bit slowly) getting the attention it deserves, and several universal truths have emerged:
- Child care is a bipartisan issue. Although specific strategies and priorities may differ from right to left, all of society benefits from well-funded and well-functioning early care and education systems.
- The ROI for early childhood investment is staggering. From a purely economic standpoint, few investments pay off as strongly or as consistently as early childhood. The National Forum on Early Childhood Policy and Programs estimates returns between $4 and $9 per every $1 invested in high-quality early childhood programs.
- Child care is ripe for modernization. We're not going to see sustainable gains by pouring more money into the old way of doing things. Better data and technology infrastructure will reduce barriers to entry, improve efficiencies, and give policymakers the data they need to make informed decisions.
May 2025 Updates
All Eyes on Appropriations and Budget Reconciliation
The release of the administration’s “skinny budget” on May 2 set the tone for a national conversation that has dominated the news cycle in the weeks since. While many ECE professionals and advocates celebrated the exclusion of feared cuts to Head Start or CCDBG in the proposed budget, that collective sigh of relief was tempered by looming cuts to other key early learning programs against the backdrop of threats to the country’s most significant social safety nets.
These new recommendations, paired with the previously issued instructions to House committees to find over $2 trillion in cuts that will largely have to come from Medicaid, Medicare, and SNAP, would have a more devastating impact on early care and education than anything we’ve seen since the pandemic.
Some of the key budget exclusions that will affect the ECE sector if codified include:
The end of the Preschool Development Grant Birth through Five (PDG B-5), which has been leveraged by 47 states and territories since 2018 to support early care and education workforces, integrate governance structures, maximize family engagement, and more. Read: A Selection of State Accomplishments During the First 3 Years of PDG B-5 (First Five Years Fund, 2024)
The end of Child Care Access Means Parents in School (CCAMPIS) grants, a 2+ decade program that funded campus-based child care services for low-income students at higher education institutions.
$6 billion in cuts to K-12 education, with flat funding for the Individuals with Disabilities in Education Act (IDEA) despite rising demand for services, including early intervention.
Those things will, unfortunately, end up looking like a drop in the bucket compared to the looming, deep cuts to both Medicaid and SNAP. Not only will these make child care even less affordable for many low-income families, they will also drive a large percentage of the early care and education workforce, 43% of whom rely on government assistance programs, even further into poverty and/or directly out of the profession. It’s worth noting that Medicaid also covers critical prenatal care, and is associated with lower infant and maternal mortality rates. It’s also a crucial lifeline for many rural hospitals and medical centers. The list of both direct and indirect impacts on every family with young children is significant enough that we can’t even begin to cover it here.
Additionally, the proposed addition of work requirements to Medicaid would put 36 million more people at risk of losing their health coverage, not because they aren’t already working (an overwhelming number of enrollees are either working or unable to work), but because of the additional administrative red tape such a requirement would add. For fellow fans of evidence-based policy, yes, we have tried this before. Every attempt at the state level has been a spectacular failure. And no, work requirements haven’t led to employment gains, only a loss of insurance for tens of thousands at a cost of millions.
Fiscal responsibility is important. But, when you realize that we could save even more money ($2.4 trillion over ten years) by simply allowing unnecessary tax cuts for households making over $400,000/year to expire, the whole thing feels punitive. Not to mention the fact that the One Big Beautiful Bill Act would add $2.3 trillion to the deficit over 10 years. The math just isn’t mathing for the average American family.
Read: What a Better Tax Bill Would Look Like (Center on Budget and Policy Priorities
The Clock is Ticking on $14M Child Care Investment in Alaska
Alaska’s child care system is hanging by a thread (all puns aside, we are big fans of thread, an organization that has done so much for AK’s ECE ecosystem). The state has lost one quarter of its child care providers in the past three years, and current estimates put the number of children who lack access to care at over 23,000.
Prospects for some level of stabilization were looking strong when the House passed its version of the budget with nearly $14 million split between grants for providers and subsidies for families, but that money is nowhere to be found in the Senate’s working draft budget. With fewer than three weeks left in the regular legislative session, there is some sense of urgency to at least maintain, if not expand, ECE funding levels. This is a situation we will be monitoring right down to the finish line.
Mississippi Eyes Unused TANF Funds for Voucher Program
In a scene that has been playing out throughout the country as the last vestiges of pandemic relief funds dry up, Mississippi finds itself in a bit of a bind. The state’s child care certificate program has become unsustainable with no replacement funding source lined up. As a result, the Department of Human Services (DHS) stopped accepting new applications, redetermination applications, and “add a child” applications indefinitely back in March.
Now, child care providers, advocates, and families are urging DHS to tap into more than $150 million in unspent TANF grant money to fully fund the child care subsidy program. At a late-April press conference, representatives from ECE organizations across the state implored DHS and political leaders to take action or risk thousands of Mississippi children losing access to care.
We’re only a year removed from the incredible "Mississippi (don’t call it a) Miracle” gains on the 2024 National Assessment of Education Progress (NAEP). This is a state that understands the value of investment in early care and education. The focus now shifts to whether they can enact a strong long-term solution to keep the child care certificate program funded.
Read: Parents and providers urge state to use unspent TANF grants for child care (Mississippi Today)
Reintroduction of Two Bicameral Bills Strengthening CACFP
The Child and Adult Care Food Program (CACFP) has been a financial and nutritional lifeline for both center-based and family child care programs dating back to 1968, serving more than 4.4 million children each day. Although that number looks impressive, it still reflects massive underutilization. A 2024 nationwide study of the program found that just 36.5% of licensed child care centers participate, with numbers as low as 15.2% in some states. Providers cited a lack of awareness and administrative burdens as the primary reasons for non-participation. Legislators reintroduced two key pieces of legislation this month in an attempt to address those issues and strengthen the program.
The Child Care Nutrition Enhancement Act of 2025 (H.R.2859 and S.1420) calls for a 10% increase for all eligible meals and snacks at CACFP-participating programs, a streamlined reimbursement system that provides equal rates to all types of providers, and an allowance for FCC providers to be reimbursed for their own children, regardless of income level.
The Early Childhood Nutrition Improvement Act of 2025 (H.R.2818 and S.1447) goes even further, adding another reimbursable meal for providers who are open more than eight hours, streamlining payment policies, simplifying reporting requirements, and creating accountability for modernization and paperwork reduction.
Other Developments Throughout the Country
Iowa failed to get Governor Kim Reynolds’ child care infrastructure bill, Senate File 445, across the line before adjourning their 2025 legislative session. The bill, which received criticism for shifting money from existing sources rather than providing any net new funding, will have to wait another year.
The Missouri Senate took up a bill that would have infused $70 million per year in tax credits into the child care system via three separate programs, including direct credits to families, an employer-provided child care assistance tax credit, and a supply-focused credit for providers’ capital expenditures. The bill was blocked by Republican filibuster and set aside after three hours of debate.
Nevada Governor Joe Lombardo called for up to $12 million in tax credits to build child care facilities in his economic development bill. The stated goal of the transferable credit is to support working families and enhance workforce stability.
North Carolina is considering loosening regulations and decoupling subsidy payments from quality ratings in an effort to keep supply levels sustainable as stabilization grants come to an end.
North Dakota Governor Kelly Armstrong signed a bill that allows employers to claim a tax credit of 50% for child care stipends offered as part of a benefits package. The credit incentivizes employers to do more to alleviate the growing cost of care in support of both recruitment and retention.
A West Virginia nonprofit is leading a grassroots approach to build a child care cooperative model throughout the state after its legislature failed to pass meaningful child care legislation in the 2025 Session. Task forces are being set up in multiple counties to bring business and community leaders into the fold in an effort to create a sustainable system for child care providers.
ICYMI: April 2025 Updates
Head Start Under Fire
[5/2/25 Update: The White House's official "skinny budget," published on May 2, did not include the elimination of Head Start. This was a tremendous relief, but we encourage readers to remain vigilant with the knowledge that it was even a discussion to begin with. The below update remains relevant.]On April 1, all staff in the Office of Head Start and Office of Child Care in Boston, New York, Chicago, San Francisco, and Seattle received Reduction in Force notices, effectively shuttering all five administrative offices. In total, Head Start has lost approximately ⅓ of its full-time workforce in the DOGE-led layoffs of government employees.
According to Kathleen Havey, Senior Director of Policy at the National Head Start Association, the organization is already starting to see signs of instability in various areas, with May 1 grant renewals looming. The Associated Press reported that Head Start centers have received nearly $1 billion less in federal funding year-over-year, and classrooms are closing as a result.
As if that wasn’t bad enough, the Washington Post reported on leaked budget drafts outlining the administration’s plans to propose the elimination of funding for Head Start altogether, a proposal that should come as no surprise to those who are familiar with Project 2025 and just how closely this administration’s agenda has adhered to that dystopian blueprint since taking office.
There is, to be frank, no good reason to eliminate Head Start and more than a million reasons (children) not to. The budget document leaked to the Washington Post includes a line “justifying” the cuts with the statement that “the federal government should not be in the business of mandating curriculum, locations, and performance standards for any form of education,” which just shows a shocking level of ignorance about what Head Start is and how it’s run.
While there have been questions over the years about Head Start’s effectiveness, mainly due to two controversial HHS studies showing what has become known as a “fade out” effect in outcomes for Head Start students in early elementary school, the overwhelming body of research shows significant and lasting social, emotional, health, academic, and economic benefits for Head Start participants (Read: NHSA Facts and Impacts). Is it perfect? No. Has it changed the lives of millions of Americans for the better? Undoubtedly.
I sat in on a policy and advocacy session at last year’s NAEYC annual conference the day after the Presidential election. When anxious conference attendees asked about Project 2025 and the plans to eliminate Head Start, NAEYC’s own policy experts dismissed the idea as extremely unlikely, pointing to the longstanding, broad, bipartisan support for the program. Sadly, as with so many things that seemed unlikely to come to fruition six months ago, that “support” has failed to keep the money flowing, and we find ourselves one step away from checking off yet another box in the Project 2025 game plan.
Decades of precedent will soon be put to the test when Congress takes up the administration’s budget requests. The Republican majority has not yet shown a willingness to push back on the President’s wishes/demands, but this one would deal lasting damage to communities everywhere, especially in the rural communities that have held such sway in recent elections. Just last year, 33 House Republicans signed a letter to Appropriators in support of Head Start, calling for it to be funded “at the highest level the Subcommittee deems possible.” Now is the time to hold true to those convictions.
The goal of these articles has always been to raise awareness of the forces shaping our early care and education system throughout the country—red, blue, and everything in between. But this particular development doesn’t have “two sides.” The elimination of Head Start would destroy a vital pillar in our early education system, while also ripping away the only viable childcare option for hundreds of thousands of families, forcing more people further into poverty, removing parents from the workforce, and ensuring that the next generation of children will be less prepared for kindergarten. We urge our readers to take action to protect Head Start at all costs. See below for more resources.
Toolkit: PROTECT Head Start (First Five Years Fund)
Advocacy Action Center (National Head Start Association)
Stealing From Our Children: Trump's Dismantling of Head Start Harms Children and Families - A May 5 Panel Discussion (Center for American Progress)
Here's why Trump's plan to gut Head Start will hurt you, even if you don't have kids (Elliot Haspel for Fast Company)
Push for Proxy Voting for New Parents in Congress Fails
The standoff on proxy voting between Florida Rep. Anna Paulina Luna and House Speaker Mike Johnson ended when the two sides reached a deal on April 6 that replaced the idea of proxy voting with a proposed formalization of the “pairing” system “long used in Congress” that enables absent lawmakers to pair with an opposing voter to essentially cancel out both votes.The issue largely revolves around new parents in Congress who need and/or desire time to recover and care for their infants, a challenge faced by millions of American families those legislators represent. Several states have taken steps to institute procedural support for both new mothers and fathers in state legislatures, including remote participation options.
Opponents of proxy voting argue that absent lawmakers miss important information and discussions and cannot effectively govern without being present. Proxy voting was temporarily enacted throughout much of the country at the height of the COVID-19 pandemic, but has largely been rolled back in the years since. Those in favor point to a legislative system that was not built with women in mind. Women currently make up only ⅓ of all state lawmakers, and just under that at the federal level.
Read more: As Congress Tables Proxy Voting, State Lawmakers Seek Solutions for Parents Who Serve in Office (U.S. News)
Ohio and Texas Houses Approve Child Care Budget Bills
The Ohio House passed a two-year budget bill on April 9 that included $213 in new money for child care programs. Of those funds, the vast majority ($200 million) will go toward child care vouchers for families in the income bracket spanning 146%-200% of the federal poverty level. The voucher program is currently serving about 8,000 children, but the federal funds that supported it are coming to an end. The new budget bill will allocate $100 million per year from TANF block grants to keep the program alive.Also included in the bill was $10 million to spin up a Tri-Share program through which participating employers will pay 40% of their employees’ child care costs and the state will pay 20%, with the employees footing the leftover 40%. The remaining $3.2 million was allocated to a child care provider recruitment and mentorship grant to build more child care supply in a state with many child care deserts.
Read more: Ohio House approves $213 million for child care in budget bill (limaohio.com)
In Texas, $100 million was earmarked for expansion of the state’s child care scholarship program, which currently has a waiting list of 95,000 families. This is hopefully the first of many child care investments to come for this legislative session, as the state projects a 2026-27 biennium surplus of approximately $24 billion.
Read more: Texas House Passes Historic Child Care Investment (Texans Care for Children)
Montana Lawmakers Try to Get Child Care Proposals Across the Line
Montana’s 90-day legislative session ends on May 3. We’re keeping an eye on a number of child care-related proposals that look like they’ll be coming down to the wire over these next couple of weeks, including:House Bill 456 would allocate $5.4 million to cover tuition costs for up to 400 children of child care workers who don’t otherwise qualify for the state’s Best Beginnings scholarship program. (Update: This bill was tabled in committee on 4/16)
Senate Bill 321 would establish an income tax credit for families, child care workers, and businesses that offer direct child care assistance to their employees. The credit stands at $600 per child for families, $1,600 for eligible child care workers, and $5,000 for qualifying businesses at the time of publication.
House Bill 220 would create a separate $1,200 tax credit for children under the age of 5. That one concluded its second reading in the Senate on April 17.
Senate Bill 565 represents the largest pending investment—a $150 million endowment fund to support workforce development, technical assistance, quality and affordability initiatives, and emergency assistance for the state’s child care sector.
Read: Bills targeting Montana’s child care challenges maintaining steam (Montana Free Press)
Other Developments Throughout the Country
Child Care Aware of America released an eye-opening report on state funding levels for child care and early learning. The report paints a picture of variable, overly complex, and disjointed administration and funding systems that are consistently coming up short for children and families. Read: An Uneven Start: 2025 State Funding for Child Care & Early Learning
Colorado amended and then eventually rejected a bill that would have required private equity-backed child care chains to post their tuition and fees online and give 60 days notice after purchasing a child care center before laying off staff or making enrollment changes.
The Florida Health and Human Services Committee unanimously passed House Bill 47, which updates licensing and compliance requirements, adds licensing exemptions for military facilities and employer-provided care, and reduces background check turnaround times.
Illinois Senate Republicans proposed two bills aimed at increasing access to care in rural and urban parts of the state. SB2382 would provide a tax credit for companies to build their own in-office child care centers, while SB1120 would offer student loan forgiveness for child care workers in existing deserts and extend the term of licensing renewals from three to four years.
Massachusetts’ House Committee on Ways and Means released their FY26 budget proposal, including over $1.6 billion in funds for early education. Neighborhood Villages put together an extensive breakdown of the proposal (including year-over-year comparisons) here.
The Pennsylvania House passed a bill requiring carbon monoxide alarms in all child care facilities. The alarms must be installed on every level of a facility and within 15 feet of any fossil-fuel-burning appliance, fireplace, or attached garage.
Wisconsin is trying to bring back a pre-k pilot idea that was originally passed into law a week before the start of the COVID-19 pandemic. The $500,000 investment would offer free pre-k options for eligible families in low-income school districts.
Stay up to date with Child Care Matters™
Stay current about new features, industry news, and ideas to inspire innovation in the ECE system.
Unsubscribe whenever you want.
Stay up to date with Child Care Matters™
Stay current about new features, industry news, and ideas to inspire innovation in the ECE system.
Unsubscribe whenever you want.