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House Child Care Legislation Exceeds $50 billion
July 27, 2020
In another busy legislative week, the House is set to pass a pair of childcare bills to financially prop-up the industry. Like our nation’s schools, many daycares and childcare facilities have been temporarily closed due to COVID-19 restrictions. Not surprising, House Democrats are using more federal spending to solve this problem.

The first piece of legislation, H.R. 7027 ([link removed]) , or the Child Care is Essential Act creates a $50 billion Child Care Stabilization Fund within the already established Child Care and Development Block Grant ([link removed]) program to help providers reopen safely and stay open. Among its provisions ([link removed]) , the legislation’s funds will require providers to continue providing pay to staff to staff, provide tuition and copayment relief for families, and help promote “health and safety through compliance” to public health guidance.

The second bill, H.R. 7327 ([link removed]) or the Child Care for Economic Recovery Act, follows H.R 7027’s goals to ensure childcare businesses remain open and accessible. The Child Care for Economic Recovery Act uses federal dollars and tax subsidies to increase funding ([link removed]) to $10 billion to the Child Care Entitlement to States program, gives $10 billion towards infrastructure improving child care safety, provides $850 million to states to subsidize dependent care for workers labeled “essential,” and creates a new tax credit to help give employees child care.

This legislation comes during a wave of record-breaking spending in Washington. According to a press release from Representative Rosa DeLauro’s office (D-CT) it is estimated that “it ([link removed]) would take at least $9.6 billion per month to keep current child care providers in business.” There is no way that our government can fund the industry at $9.6 billion every month, nor should they.

Thankfully, Representative Gary Palmer (R- AL) has a solution that doesn’t involve more federal subsidies and provides more flexibility to working-families in how they spend their money. Palmer introduced a bill, H.R. 7149 ([link removed]) , protecting 2020 Flexible Spending Account (FSA) funds from being lost at the end of the year. As you may know, FSA accounts are often used by families to help cover the cost of childcare and these funds must be used within the calendar year or be forfeited. Yet many families have found themselves with excess funds from the sudden stop of our day-to-day lives in March, and this legislation will allow them to roll over their 2020 FSA balance to 2021, withdraw their balance without facing a penalty, change the amount in the account, and to continue using leftover funds through the end of the year even if they lose their job.

As Representative Palmer says in his press release announcing the bill ([link removed]) :

“Many people plan ahead with FSAs, and they shouldn’t be penalized for being proactive due to extraordinary circumstances. My bill offers temporary protection for those who have been unable to use their 2020 FSA funds due to compliance with recent stay-at-home orders, and I’m grateful for the support it’s already received. Planning ahead should never be punished, and I hope the measures in H.R. 7149 Act help many people to continue doing just that as we adjust and plan for life beyond this unprecedented period for our country.”

Please join us in asking your Representative to vote NO on both the Child Care is Essential Act and the Child Care for Economic Recovery Act. And as a solution to the childcare problem, please also ask your Representative to cosponsor Representative Palmer’s legislation, H.R. 7149.
Capitol Switchboard: 202-224-3121
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