Fact Sheet: Build Back Better Act - Child Care and UPK

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Subsection (h): Use of Funds.

• For FY 2022 – 2024, funds must be used for:
  • Assistance to access to child care for eligible children; increasing provider payment rates, including rates sufficient for increased staff wages; and waiving or reducing copayments
  • Activities that improve the quality and supply of child care services
  • Administration costs
• For FY 2025 – 2027:
  • Starting October 1, 2024, states must use funds provided for direct child care services for activities to improve the quality and supply of child care services
  • States must ensure that parents of eligible children can access services through grants or contracts that at a minimum, support providers’ operating expenses and address underserved populations
  • States must issue a child care certificate directly to a parent that can only be used for a payment or deposit for direct child care services
  • From the total of the payments made to states each year, states must reserve equal to not less than 5% and not more than 10% for quality improvement activities
    • Quality improvement activities include increasing quality and supply and the number of available slots (with priority for providers in underserved communities serving or seeking to serve underserved populations); startup grants and supply expansion grants (priority for providers serving underserved populations); quality grants toward provider tier improvement; and facilities grants (cannot be used primarily for sectarian instruction or religious worship)
    • Funds may be administered directly by the lead agency or through other state government agencies, local or regional child care resource and referral organizations, or community development financial institutions
    • Additional quality improvement activities include training and professional development; enhancing state’s tiered system; improving supply and quality in underserved populations; and improving access to child care services for children experiencing homelessness and children in foster care
    • A portion of this amount must be reserved for states to provide technical assistance to increase supply and quality

Subsection (i): Grants to Localities and Awards to Head Start Programs.

• Defines “eligible locality” as a city, county, or other unit of general local government, or a Head Start grantee
• Directs the Secretary to awards funds to eligible localities in states that have not received payments under subsection (g)
• Directs the Secretary to allot the amount specified in subsection (c) to children from families that are below 200% of the poverty line and that are under age 6
• Directs the Secretary to award funds under subsection (c)(5) to Head Start agencies to carry out the purposes of the Head Start Act in the applicable state
• The Secretary must prioritize entities serving a high percentage of individuals from underserved populations
• The Secretary may recoup unused funds allotted under this section

Subsection (j): Program Requirements.

• Applies Title IX of the Education Amendments of 1972, Title VI of the Civil Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, the Americans with Disabilities Act of 1990, and Section 654 of the Head Start Act to any program or activity receiving funds
• A state receiving funds must maintain the expenditures of the state at the average level of expenditures by the state for the 3 preceding fiscal years; these state expenditures may also be counted for meeting the requirements to provide a non-federal share
• Funds must be used to supplement and not supplant

Subsection (k): Monitoring and Enforcement.

• The Secretary must monitor state compliance
• The Secretary will establish procedures in the event a state fails to comply with the state plan or other requirements

Subsection (l): Administration.

• The Secretary must provide technical assistance to states to carry out research, evaluations and administration related to this section

Subsection (m): Transition Provisions.

• For each of FY 2025 – 2027, states receiving funds cannot use more than 10% of CCDBG funds to provide child care assistance to children under the age of 6 that are eligible under this Act
• Any children under age 6 that is not yet in kindergarten and is receiving assistant under CCDBG on the date funding is first allocated to the state must be deemed immediately eligible to receive assistance and may continue to use the child care provider of the family’s choice