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House Passes Critical COVID-19 Support for Childcare Sector, Including $651 Million for Maryland

Jul 29, 2020
Press Release
Without help, Maryland could lose 78,375 licensed childcare slots, 53% of current supply

(Washington, D.C.) – Congressman C.A. Dutch Ruppersberger today voted in support of urgently-needed legislation to stabilize the American childcare sector and the families it serves – a key component to reopening the U.S. economy amid the COVID-19 pandemic. The Child Care is Essential Act and the Child Care for Economic Recovery Act both passed the U.S. House of Representatives and now head to the U.S. Senate for consideration.

Without help, roughly half of Maryland’s childcare capacity is at risk of disappearing – more than 70,000 slots at licensed facilities – according to a recent study by the Center for American Progress.

“The coronavirus pandemic has brought the already-struggling childcare sector to its knees, forcing many centers to close and leaving families without quality, affordable care when they need it most,” Congressman Ruppersberger said. “We can’t talk about reopening our economy without talking about how families will care for their children. If we do not take immediate, aggressive action to stabilize the childcare sector, the economic consequences will last far beyond a vaccine and maybe even decades.”
The Child Care is Essential Act creates a $50 billion Child Care Stabilization Fund to provide grants that can be used by childcare providers for a wide range of costs associated with reopening. Maryland providers could expect to receive more than $651 million of the funds under the bill’s distribution formula. Providers who receive grant funds must continue to employ and pay their employees at pre-COVID-19 levels, meet federal, state and local health and safety guidance and offer tuition relief to families.
The Child Care for Economic Recovery Act enhances the childcare tax credit, making it refundable, and doubles the amount that can be contributed to a dependent care flexible spending account. It creates a new 30 percent refundable payroll tax credit for employers who offer dependent care benefits.
To help keep childcare providers afloat, the bill creates a 50 percent refundable payroll tax credit for mortgage obligations, rent obligations, and utility payments incurred by childcare facilities that have suffered revenue losses or are subject to a COVID-19 related closure. It incentivizes employers to keep childcare workers on payroll by expanding the employee retention tax credit.

The legislation invests $10 billion in infrastructure to improve childcare safety related to COVID-19, such as structural changes to promote social distancing and sanitization. It also provides $850 million to support family care for essential workers and increases funding for federal childcare programs.
“I’m proud to join my House colleagues in being part of the solution,” Congressman Ruppersberger said. “With these investments, our nation can take a step toward safely reopening and rebuilding our economy. It’s now up to our colleagues in the Senate to act boldly and join us in protecting working families and finding real solutions.”