GOLETA, Calif. – On Monday outside of the First Five California offices in Goleta, Congressman Salud Carbajal detailed the bipartisan Child Care Investment Act, a bill to lower child care costs as well as create new tools for businesses to provide childcare assistance to their employees.
The bipartisan bill, introduced alongside Republican Congresswoman Lori Chavez-DeRemer of Oregon, would create a tax credit for employers to provide childcare options for employees, add in-home services as an eligible use, and allow businesses to partner on new child care programs.
Currently, The Employer-Provided Child Care Credit only allows a business to apply for those tax credits when contracting with an existing child care provider or when creating their own facility.
The bill would also expand the existing federal employer-based child care credit by raising the maximum credit amount from $150,000 to $500,000 while giving small businesses a maximum credit amount of $600,000.
“When I sit down with Central Coast working families or small business owners to talk about what they’re worried about when it comes to making ends meet, there is always one consistent item: the cost and availability of child care. Families can’t find the care they need, or can’t afford it. Businesses can’t hire who they want because there’s not enough care options,” said Representative Carbajal. “That’s why I’ve worked with our local business owners and others to craft a commonsense, bipartisan bill that ensures tax incentives we already have on the books are working correctly to support child care affordability and reflect the realities of child care today.”
Additionally, the bill would double the amount that can be saved by a family through a tax-exempt Dependent Care Flexible Spending Account (DCAP) to cover child care expenses up to $10,000 annually while adding an additional $2000 in DCAP savings per additional dependent.
The existing $5000 annual cap on the DCAP has remained the same for the last 40 years, when the program was first created.
“Skyrocketing costs have left affordable child care out of reach for too many families. Unfortunately, this problem often falls on women, who then must decide between staying at home and pursuing a career or education that they are passionate about. It has a far-reaching effect on families, local businesses, and our economy, which is why investing in child care is also an investment in the future growth and success of our communities. As a mom of twin daughters, I’m proud to help lead the bipartisan Child Care Investment Act so mothers and parents don’t have to worry about breaking the bank to find quality care for their children,” explained Representative Chavez-DeRemer.