Ernst’s Bipartisan Bill Would Allow Child Care Providers to Access Small Business Support

WASHINGTON – U.S. Senator Joni Ernst (R-Iowa), a mother and a member of the Senate Small Business Committee, is partnering with Senator Jacky Rosen (D-Nev.) on bipartisan legislation focused on improving access to child care in Iowa and across the country.

With more than 700,000 Iowans now living in a “child care desert,” and Iowa losing more than 40% of its regulated child care providers since 2012, Ernst’s bill seeks to increase access to child care by allowing non-profit child care providers to utilize capital access programs offered by the Small Business Administration (SBA), something the current law only allows for for-profit entities.

“Iowa was already facing a child care crisis even before the pandemic, but those challenges for our families and communities have only become more severe since. One key area of improvement we should focus on is expanding opportunities for new child care facilities,” said Senator Joni Ernst. “This bipartisan effort is a commonsense fix that takes existing programs and allows them to be used to help child care providers, including our non-profit centers, which will in turn help give our working parents greater access to quality and affordable care for their kids.”

“The COVID-19 pandemic has made access to quality, affordable child care all the more difficult; hindering parents -- particularly mothers -- from taking part in our workforce,” said Senator Rosen. "Even before the onset COVID-19, half of U.S. families reported difficulty finding access to affordable child care – hurting their financial stability and stunting our nation’s economic growth. This bipartisan bill would help address this problem by investing in child care providers so that they can help increase the number of available child care slots, giving parents access to more affordable child care services they need and creating jobs in their communities.”

“This legislation is going to support kids and families by giving organizations grounded in our communities access to the tools that will allow them to have an even greater impact,” said Christy Gleason, Vice-President for Policy, Advocacy, and Campaigns at Save the Children Action Network. “Families have always known the critical role that providers play, and the pandemic has shown all of us how important that role is, as well as how susceptible the organizations that care for our children are to economic shocks at the times when families need them most. This piece of legislation couldn’t come at a better time, and Save the Children applauds Senators Rosen and Ernst.”

“Non-profit child care providers offer a critical service to families across the country, but there are many barriers preventing these providers from establishing or expanding care that has proven to positively impact young children’s development and future success in and out of the classroom,” said First Five Years Fund Executive Director Sarah Rittling. “It is important, now more than ever, that Congress finds innovative solutions that ensure all families who need it have access to high-quality child care options.  We are pleased to see Senators Rosen and Ernst and Representatives Lee and Stauber, all working together on a bipartisan, bicameral proposal that would expand access to affordable, quality child care across the country by allowing non-profit providers to access the same financial resources available to for-profit providers.”

“The Covid-19 pandemic has continued to highlight the fragile state of child care businesses. This bipartisan legislation will help ensure that all child care providers are able to establish and operate a successful business, better serve children and families, and ultimately have a positive impact on the broader economy,” said Linda Smith, Director of the Early Childhood Initiative at Bipartisan Policy Center. “We commend Reps. Susie Lee and Pete Stauber and Sens. Joni Ernst and Jacky Rosen, for reintroducing this legislation and are pleased to see them working in a bipartisan manner to improve the child care market.”

"This legislation represents  a critical investment in the resources needed to ensure a recovery for Nevada's businesses and families,” said Dr. Tiffany Tyler-Garner, Executive Director of Children’s Advocacy Alliance. “By allowing the full array of childcare providers to access vital resources like SBA loans, this legislation places  childcare providers on equal footing while supporting a significant expansion of our capacity to provide affordable high quality childcare."

The SBA currently offers multiple programs to help small businesses access capital, including the 7(a) program and the 504/Certified Development Company program. Through these initiatives, the SBA provides loan guarantees for small businesses that cannot acquire credit elsewhere. Currently, for-profit child care centers are eligible for these programs.

The Child Care Small Business Investment Act would make non-profit child care providers eligible for all SBA capital access programs so long as they are licensed by the state and their employees have had criminal background checks.

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