Rep. Schrier Introduces Bipartisan Bill to Help Working Families Afford Child Care
WASHINGTON, DC – Today, U.S. Representatives Kim Schrier, M.D. (D-WA) and Brian Fitzpatrick (R-PA) introduced the Improving Child Care for Working Families Act. This bipartisan legislation will help working families in Washington and across the country afford child care.
One resource available for families is a Dependent Care Assistance Plan (DCAP). DCAPs aim to help alleviate this financial burden by allowing families to set aside $5,000 of their pre-tax income to cover expenses related to child care. The limit of $5,000 has remained for nearly four decades, even as the cost of child care has skyrocketed. Congresswoman Schrier’s bill more than doubles the cap, changing it to $10,500.
“As a parent and pediatrician, I know how challenging it can be to find affordable, quality, reliable child care. Unfortunately, as costs have gone up, families are feeling the squeeze more and more,” said Rep. Schrier. “My bill provides a direct, commonsense solution to give working families financial breathing room, make child care more affordable, and provide a spark for local economies.”
“With costs of childcare on the rise, too many American parents and working families are struggling to afford care for their children,” said Congressman Fitzpatrick. “The bipartisan, bicameral Improving Child Care for Working Families Act will give families more options, and the freedom to utilize a larger amount of pretax income for childcare.”
Paying for quality child care is a significant challenge for nearly all parents. In Washington state, families pay the third highest child care costs in the nation, with high-quality care often costing more than tuition at a public university. Approximately half of all Washington parents have reported difficulty finding, affording, and keeping child care long term. In addition to the pressure it places on families, the lack of affordable child care also negatively impacts the economy. It is estimated that over $6 billion dollars has been lost in direct and opportunity costs due to employee child care issues. At a time when employers are desperate for qualified employees, this bill to help make child care more affordable can give parents who would like to return to work outside the home the opportunity to do so.
“The Bipartisan Policy Center thanks Representatives Schrier (D-WA) and Fitzpatrick (R-PA) for their continued work to increase dependent care assistance plan contribution limits. The contribution cap has not received a permanent increase since 1986 despite the fact that the national average for the cost of child care has more than doubled in the intervening years. Often in the form of flexible savings accounts, these pre-tax employee/employer contribution programs can be a lifeline for families seeking child care. Increasing the cap means increasing help to working parents and ensures employers can better support their employees with caregiving needs,” said Linda Smith, Director, Bipartisan Policy Center’s Early Childhood Initiative.
"Congress first allowed parents to set aside their income for childcare expenses on a tax-free basis in 1981, and it set the limit at $5,000 per family per year in 1986. The limit has been $5,000 ever since, with the exception of a temporary increase in 2021, even though childcare costs have increased significantly in the past 35 years,” said Andrew Lautz, Director of Federal Policy, NTU. “It's long past time Congress lift the limit on tax-free dependent care assistance program (DCAP) contributions for working parents. National Taxpayers Union applauds Representatives Schrier and Fitzpatrick for their leadership on this issue and we're proud to support the Improving Childcare for Working Families Act."
“The Early Care & Education Consortium is once again pleased to support the bipartisan, bicameral Improving Child Care for Working Families Act. High-quality child care has long been out of reach for families across the country,” said Sage Schaftel, Interim Executive Director, ECEC. “This legislation provides a simple yet meaningful fix that will go a long way toward both helping working families afford quality care, and addressing the workforce crisis facing the broader economy. We need a holistic solution to the persistent child care crisis—permanently lifting the DCAP limit after nearly 40 years of stagnation is a critical piece of the puzzle.”
This legislation is endorsed by: Bipartisan Policy Center, Save the Children, National Taxpayers Union, Employers Council on Flexible Compensation, and the Early Care and Education Consortium. A Senate companion is expected to be introduced in the coming weeks.