U.S. Senators Katie Britt (R-Ala.) and Tim Kaine (D-Va.), a member of the Senate Health, Education, Labor and Pensions (HELP) Committee, have introduced two key pieces of legislation: the Child Care Availability and Affordability Act and the Child Care Workforce Act.
Together, these bills represent the boldest bipartisan effort since 1998 to make child care more affordable and accessible by enhancing existing tax credits and increasing the supply of childcare providers.
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“Accessing and affording child care is a costly challenge all too familiar to families across Alabama and our entire nation. This growing crisis has resulted in more and more parents, especially mothers, being forced to leave the workforce. I’m proud to join Senator Kaine in leading this bipartisan legislation to put parents back in the driver’s seat by empowering and equipping hardworking Americans to determine the best path for their family,” said Britt. “Our common ground solutions will help strengthen America’s labor force participation, fueling local Main Street small businesses and growing the economy.”
“I’ve heard from Virginians in every corner of the Commonwealth about how difficult it is to find affordable child care and how low wages are driving dedicated childcare workers out of a field they love,” said Kaine. “This crisis is holding our families, workers, and economy back, and I’m proud to be introducing the boldest bipartisan proposal to tackle it head on.”
The worsening childcare crisis affects families, workers, businesses, and the broader economy. Across the country, many families struggle to find or afford high-quality child care, which is essential for parents to work and for children to thrive.
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Over the past 30 years, childcare costs have surged by 220%, forcing families—especially mothers—to make difficult choices.
More than half of all families live in childcare deserts, and childcare workers often earn poverty-level wages, leading to high turnover and financial struggles for providers. This crisis, exacerbated by the pandemic, costs the U.S. economy approximately $122 billion annually in economic losses.
Child Care Availability and Affordability Act
The Child Care Availability and Affordability Act aims to make child care more affordable by:
- Increasing the Child and Dependent Care Tax Credit (CDCTC) and making it refundable, allowing lower-income working families with out-of-pocket child care expenses to benefit for the first time. The maximum CDCTC would expand to $2,500 for one child and $4,000 for two or more children.
- Strengthening the Dependent Care Assistance Program (DCAP) to allow families to deduct 50% more in expenses (up to $7,500).
- Allowing eligible families to benefit from both the DCAP and the CDCTC when their child care expenses exceed the DCAP threshold, benefiting middle-income families with high child care costs.
- Radically bolstering the Employer-Provided Child Care Tax Credit (45F) to encourage businesses to provide child care to employees, increasing the maximum credit from $150,000 to $500,000 and the percentage of expenses covered from 25% to 50%. It also offers a larger incentive for small businesses and allows joint applications for groups of small businesses.
Child Care Workforce Act
The Child Care Workforce Act addresses the issue of low wages forcing providers out of the industry by establishing a competitive grant program for states, localities, Tribes, and Tribal organizations to adopt or expand pay supplement programs for childcare workers. Key aspects of the program include:
- Providing quarterly supplements directly to both home-based and center-based licensed childcare providers.
- Requiring evaluations of impacts on turnover, child care quality, availability of affordable child care, and financial burdens on providers.
The proposal is split into two bills because one modifies existing tax credits, under the jurisdiction of the Senate Finance Committee, while the other authorizes a new pilot program, under the Senate HELP Committee.
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