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Public Statements

Statements On Introduced Bills and Joint Resolutions

Location: Washington, DC



Mr. KERRY. Mr. President, as Congress comes back in session for a five-week work period, it is high time we put partisan bickering aside and take up real issues that will improve the lives of America's hard-working families. Today, I rise to address one such problem--the growing shortage of quality child care for our country's future generations. Over the past 50 years, the United States has witnessed a 43 percent increase in the number of dual-

earner and single-parent families. Furthermore, the Census Bureau estimates that more than six million children are left home alone on a regular basis. Nationwide, more households than ever are struggling to make ends meet, while providing safe, nurturing environments for their children to grow up in. For many, child care is not a choice, but a necessity in this endeavor. That is why we owe it to our Nation's families to increase the availability of quality child care--because strong, healthy families build a stronger America.

As the Ranking Member on the Senate Committee on Small Business and Entrepreneurship, I firmly believe that we can work with the Small Business Administration (SBA) to cultivate and expand existing child care facilities. In light of this, I rise today to introduce the Child Care Lending Pilot Act of 2006, which establishes a three-year pilot program enabling small, non-profit child care businesses to be eligible for the SBA's 504 loans.

With affordable fixed low interest rates and long terms, 504 loans play a vital role in spurring economic development and the rebuilding of communities. Current law permits for-profit child care small businesses to finance building repairs and expand existing facilities through these 504 loans. However, their non-profit counterparts are unable to access the same financing through the SBA. Given that the majority of child care centers in many States across the country operate as non-profits, this system is shutting out the lion's share of facilities from obtaining necessary funds to provide quality care for the families they serve. The Child Care Lending Pilot Act of 2006 reverses this trend. By allowing non-profit child care businesses to apply for 504 lending, the legislation enables these entities to put down only 10 to 20 percent of the loan with a term of up to 20 years. With low, predictable monthly payments, these non-profit centers can then invest in the families they provide services to, by updating and improving their buildings and materials without breaking the bank or raising fees.

Since the industry is not high-earning overall, a majority of child care centers do not have an abundance of easily accessible capital. Proposals that call for centers to simply charge less or cut back on employees are not the way to make child care more affordable for families and do not serve in the children's best interests. An adequate staff is crucial in ensuring that children receive proper supervision and support to foster their development and learning. Furthermore, if centers are asked to decrease operating costs in order to lower costs absorbed by families, the safety and quality of the child care provided would most likely be in jeopardy.

In recent years, the Children's Defense Fund estimated that in all but one State, the average annual cost of child care in urban area child care centers is more than the average annual cost of public college tuition. Additionally, they projected that child care can easily cost between $4,000 to $10,000 per year in cities and States across the Nation. Clearly, these high costs pose virtually insurmountable hurdles for low-income families in need of quality care for their children. Although many States have implemented grant and loan programs to help these child care small businesses, more must be done--not only to improve the quality of care, but also the overall supply of child care facilities for the Nation's neediest families.

I urge my colleagues to support this important legislation and allow non-profit child care providers to access SBA 504 financing for their facilities and the children they serve. Funded entirely through fees, this legislation requires no appropriation. Additionally, it is consistent with the three-year SBA reauthorization cycle. This legislation is the product of work on this issue in both the 107th and 108th Congresses. Similar legislation was introduced in 2002, S. 2891, however the four year provision made this program inconsistent with the cycle of SBA reauthorization. To remedy this, I reintroduced the measure in 2003 as S. 822, making the act a three-year pilot program consistent with the cycle of reauthorization. This pilot program was also part of the larger Senate Small Business reauthorization legislation in the last Congress, S. 1375. Unfortunately, this innovative proposal to expand child care, which had bipartisan support, was cut out of the final authorization package when a scaled-back version of the reauthorization legislation, without most Democratic initiatives, was added to the FY2005 omnibus appropriations bill.

Although there is no quick-fix solution for the Nation's child care shortage and lack of quality facilities, this bill marks an important step in the right direction by allowing non-profit child care centers to receive SBA loans. I hope that my colleagues on both sides of the aisle will recognize the vital role that early education plays in the development of fine minds and productive citizens, and realize that in this great Nation, child care should be available to all families in all income brackets. The Child Care Lending Pilot Act of 2006 is a sound investment in our Nation's future--our children.

I ask unanimous consent that the text of the bill be printed in the RECORD


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