Axne Bills to Preserve and Expand Iowans' Child Care Savings Pass House
Press Release
Today, the U.S. House of Representatives advanced two bipartisan measures authored by Rep. Cindy Axne (IA-03) in legislation to support the affordability and accessibility of child care for Iowa's working families.
The House passed the Child Care for Economic Recovery Act, which includes the text of Rep. Axne's Improving Child Care for Working Families Act and COVID-19 Dependent Care Flexible Spending Arrangement Rollover Act of 2020. Both Axne bills expand Iowa families' ability to cover child care costs through dependent care assistance plans (DCAPs), which allow working parents to set aside pre-tax income for child care.
"Without access to safe affordable child care for their children, Iowa's families will also be a step behind as we work to get our economy back on track," said Rep. Axne. "I'm pleased to see the House passing two commonsense and bipartisan provisions I wrote earlier this year to ensure that families who are saving for child care are not left empty-handed and that their savings will actually cover the real costs of care. I'm proud of my votes today to advance these packages that will help lower costs of child care, improve facilities, and keep the children our essential workers safe and cared for as we continue to weather the impacts of this pandemic."
The Improving Child Care for Working Families Act increases the cap on how much families can place in their DCAPs to $10,000 in order to cover the current costs of child care. The current limit, set at $5,000, has not changed since the Internal Revenue Service first set in in 1986.
The COVID-19 Dependent Care Flexible Spending Arrangement Rollover Act of 2020 prevents families from losing thousands in unspent DCAP savings at the end of 2020 by allowing the funds to rollover to the new calendar year. Currently the tax benefit resets on January 1, meaning savings not used on child care by the end of the year because of coronavirus precautions will be erased without this change.
In addition to these two provisions, the Child Care for Economic Recovery Act also:
Enhances the child and dependent care tax credit (CDCTC) and makes it fully refundable
Creates a new refundable payroll tax credit for eligible employee dependent care benefits paid by employers
Increased funds for the Child Care Entitlement to States program for the first time in more than a decade
Provides $850 million for states to fill gaps in dependent care for essential workers
Invests $10 billion over 5 years to improve child care facilities and infrastructure
Today, Rep. Axne also joined her colleagues in advancing the Child Care Is Essential Act, which creates a new Child Care Stabilization Fund to provide grant funding to child care providers to ensure safe reopening and operations.
The grants would help child care providers keep up with operating expenses while requiring that providers continue to pay their staff, as well as promote compliance and reporting to ensure providers are following best practices and public health guidelines.
A recent report by the Center for American Progress found that the COVID-19 pandemic could lead to a permanent loss of nearly 4.5 million child care slots, removing child care options for families as they need to return to work.
Support for the COVID-19 Dependent Care Flexible Spending Arrangement Rollover Act of 2020
The legislation has also been endorsed by the Early Care and Education Consortium (ECEC), Employers Council on Flexible Compensation (ECFC), Save the Children Action Network, National Child Care Association, First Five Years Fund, Iowa Primary Care Association, EveryStep -- Iowa, Iowa Association for the Education of Young Children, Child and Family Policy Center, United Way of Central Iowa, and Iowa Community Action Association.
The legislation was also recently endorsed by the National Taxpayers Union, National Association of Social Workers, Independent Women's Forum, and Iowa child care provider ChildServe.
Support for the Improving Child Care for Working Families Act
The legislation has been endorsed by the National Child Care Association, the Employers Council on Flexible Compensation, the Save the Children Action Network (SCAN), the Early Care and Education Consortium, National Association of Social Workers, and the Iowa Primary Care Association, as well aslocal Iowa businesses and health care providers.
Additional Child Care Legislative Work by Rep. Axne:
In February, Axne introduced bipartisan legislation to expand eligibility for Small Business Administration (SBA) loans to include non-profit child care providers.
Last year, Axne introduced legislation to assist states with implementing background check requirements for child care workers. She held a forum on the state of child care in Iowa after reports of infant and child injuries and death. Here, she heard from parents and child care experts about the various needs for child care safety and access.
Last week, Rep. Axne hosted a briefing on child care and invited Dr. Teri Wahlig, CEO of ChildServe -- Iowa to speak before House staff on the work ChildServe is doing and their challenges of providing child care during COVID-19.
Source