🇺🇸 We could see $40 billion in child care relief. Here’s how.

🇺🇸 We could see $40 billion in child care relief. Here’s how.

Policy expert Elliot Haspel weighs in on the latest US stimulus proposal.


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Aaron Hathaway
February 3, 2021
In a rush? Here’s the quick run-down.
  • The $40 billion for child care relief is part of the Biden administration’s $1.9 trillion stimulus proposal. It takes a two-pronged approach, aiming to give financial benefits to providers and parents alike.
  • $25 billion would go to an emergency relief fund for the sector, which is a first during this pandemic. That money would help cover things like rent, payroll, and sanitization expenses.
  • We don’t yet know when that money will be available, or how. We’ll have to wait and see, as the package proceeds through the whole legislative process.

In mid-January, the Biden administration released the details for their proposed $1.9 trillion stimulus package. Tucked inside is some well-deserved good news for child care.

The proposal includes 40 billion dollars earmarked for the child care sector. It’s the most ambitious relief spending that the industry’s seen so far in this pandemic. And given how hard the coronavirus has battered the sector, support on this scale was a long time coming.

But is it enough?

To get an expert’s perspective, I called up Elliot Haspel. Elliot is an early childhood policy expert, a writer and a parent. He served as a policy analyst at the Virginia Early Childhood Foundation, and is the author of Crawling Behind: America’s Childcare Crisis & How to Fix It.

Elliot’s first reaction to the plan is optimistic. As he points out, this $40 billion, plus the $10 billion from December’s stimulus gets us to $50 billion in relief for child care, which is what many experts called for to help the sector through the pandemic.

“In a lot of ways, this is the lifeline the child care sector has been waiting for,” Elliot says. “This should be sufficient to carry the sector forward for the next six to nine months. It’ll be enough to keep programs from going under, to reopen, and to deal with the fact that enrolments won’t bounce back right away.”

Right now, the whole $1.9 trillion plan is still only a proposal. But how exactly would that $40 billion for child care get spent — and how do we turn this plan into real-world relief?

We’ll get into all the details down below.

What’s in the bill for child care relief?

First thing’s first: Let’s break down that $40 billion in child care relief spending.

Direct from the Biden administration’s fact sheet, here are the three core ways this spending package would bring long-awaited relief to the child care sector:

  • Creating a $25 billion emergency stabilization fund for the sector. This measure is intended to help child care providers, including family child care homes, cover their costs and operate safely. The funds would help providers stay open, as well as help closed centers cover the costs of reopening.

    As the plan states, this money could be used to cover costs such as:
  • Rent and utilities
  • Payroll
  • Personal protective equipment
  • Increased ventilation and sanitation expenses
  • Costs associated with smaller group sizes
  • As of now, we haven’t seen any details as to how this money would be distributed to states or individual providers. We’ll have to follow that over the coming weeks.
  • Adding $15 billion in funding to the Child Care Development Block Grant. This funding would be on top of the $10 billion boost to the CCDBG from December’s stimulus package. The CCDBG provides child care subsidies to low-income parents, and can also fund initiatives to boost staff training and child care program quality. The administration expects this funding to help parents afford child care and return to the workforce, as well as rebuild the supply of child care providers across the country.
  • Increasing child care tax credits for parents to help cover child care costs. This portion would create a one-year boost to the limit of tax money parents can reclaim for their child care expenditures. Families could receive a total of up to $4,000 for one child, or $8,000 for two or more children. The tax credit would be refundable, so even if a family with two children doesn’t owe $8,000 in taxes, they could cash out the difference.

    This initiative would make it easier for parents to afford child care, ultimately bringing more income to providers — and will also ease financial pressures on the many child care workers with children of their own.
What other parts of the bill could bring relief for child care?

While that $40 billion directly targets the child care sector, it represents only two percent of the entire $1.9 trillion spending package.

Other parts of the administration’s American Rescue Plan could also bring significant relief to workers and families in the sector. Here’s how:

  • Direct $1400 stimulus checks. Biden’s administration has toted these $1400 payments as a core element of this new spending bill, and the vast majority of child care workers will qualify to receive the full payment.
  • Extending pandemic leave policy. The plan would reinstate paid sick leave funding for workers, valid through September 2021. This would make it easier for child care workers to quarantine if they become sick, or to stay home to care for someone who is ill.
  • Increasing food assistance benefits. Part of the proposal calls on Congress to extend a funding increase to the Supplemental Nutrition Assistance Program (SNAP) funding for low-income families. With the widespread problem of low wages in the sector, many early years educators qualify for these SNAP benefits.

What’s next for the American Rescue Plan?

It’s worth reiterating that right now, all this is still a proposal. It hasn’t yet become real legislation, which needs to happen before we can cash any checks.

To become real-life relief for child care, Biden’s American Rescue Plan will first need to pass both chambers of Congress. Along the way, it will be subject to amendments, delays and negotiations from both sides of the aisle.

Republicans have proposed their own trimmed-down version of a stimulus bill, which budgets $20 billion for child care — but they don’t have enough votes to pass that through Congress without Democratic support, which is unlikely. And just this week, Democrats moved to kick off the budget reconciliation process, a shortcut by which they can push ahead with Biden’s proposal without needing Republican support.

It’s unlikely that the full $1.9 trillion plan will pass in its original form — proposals this size always get tweaked along the way. However, Elliot is confident the specific $40 billion for child care isn’t at high risk of getting cut.

He points to the fact that in past relief spending, child care funds haven’t really been a point of conflict between Republicans and Democrats. Plus, vocal child care advocates like Sens. Patty Murray and Bernie Sanders can help defend this spending.

“Obviously, let’s not count our chickens before they hatch. But I do think child care can be reasonably confident that a significant portion of what’s proposed, if not all, will get approved,” he says. “It could get trimmed, sure. But I think it would be pretty surprising, and immensely disappointing, if child care spending gets cut.”

Approving this proposal is just the first step. After that, we’ll have to see how the money gets distributed. As Elliot notes, figuring out how to implement a spending plan on this scale may take some time.

“The CARES Act was implemented back in March, and there were still programs waiting to see that money in October,” Elliot says. “Our bureaucratic system is just not a nimble framework — so we’ll have to see how that pans out as this turns into legislation.”

What can you do to push for child care relief?

At the time of this story’s publication, we haven’t yet seen any concrete timeline for turning this proposal into real-life relief.

But you don’t have to sit on your hands until that happens.

In the here and now, you can contact your local congressperson, and let them know how important this child care spending is for you. Given the size and vital importance of the American child care sector, making sure your voices get heard can help underscore the importance of these $40 billion during the negotiation processes.

“Make sure your representatives know that you want this proposed funding to be passed in full. If it means something to you, tell your representatives. It’s always positive when our politicians hear that people are really paying attention,” Elliot says.

Contacting your representative only takes a few minutes. If you’re unsure who that representative might be, you can find out and get their contact information right here. If you’d like to read more from Elliot Haspel on the state of child care in the US, and why this $40 billion means so much, you can keep reading right here.

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