H.R. 2595 — Building Child Care for a Better Future Act

This section increases the mandatory appropriation for Child Care Entitlement to States (CCE) grants—formula funding under the Temporary Assistance for Needy Families (TANF) program for child care assistance to low-income families—to $20 billion for FY2026, with each subsequent fiscal year funded at the greater of the prior year's amount or that amount increased by the CPI for all urban consumers; reserves 5% for Indian tribes and tribal organizations, 4% for territories, up to 0.5% for technical assistance and dissemination, and 0.5% for research, demonstrations, and evaluations (thus allocating approximately 90% to the 50 states and District of Columbia). It further (1) requires redistribution of unused tribal grants to other tribes and tribal organizations able to expend them; (2) removes the restriction limiting the federal medical assistance percentage (FMAP) to its September 30, 1995, definition (thus applying current FMAP rates); and (3) makes technical and conforming amendments, including subjecting CCE funds for states, territories, and tribes to Child Care and Development Block Grant Act requirements; redefining "State" to exclude territories; and adding definitions for "Indian tribe," "territory" (Puerto Rico, U.S. Virgin Islands, Guam, American Samoa, Northern Mariana Islands), and "tribal organization."

This section establishes a new grant program under SSA §418(e) to improve child care workforce, supply, quality, and access in areas of particular need, separate from existing child care assistance provisions. (As background, SSA §418 authorizes Child Care and Development Block Grant (CCDBG) funding for subsidies and related activities to low-income working families.) The program appropriates $5 billion annually with no specified end date, of which the Secretary of Health and Human Services reserves (1) 5% for grants to Indian tribes and tribal organizations, (2) 4% for grants to territories, (3) up to 0.5% for technical assistance under CCDBG §658I(a)(3)-(4), (4) 0.5% for a required evaluation, and (5) up to 3% for administrative expenses. Remaining funds are allotted to states proportional to their CCDBG mandatory spending under SSA §418(a)(1)-(2). To receive grants, states, territories, tribes, or tribal organizations must describe in their CCDBG plan (or amendment) criteria for identifying areas of particular need; community engagement; targeted areas and age groups; and planned uses such as contracting for child care slots with compensation expectations, expanding family child care networks, providing start-up funding and technical assistance, recruiting providers, supporting training and professional development (including apprenticeships, scholarships, and union partnerships), and increasing workforce compensation through wage supplements, bonuses, and retention rewards.