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Requires states to limit child care subsidy overpayments: if a state's overpayment rate for a fiscal year exceeds 5% of total payments, the state must submit a corrective action plan and any required reports to the Secretary for approval. If a state's overpayment rate exceeds 5% for two consecutive years, the state becomes ineligible for funds under the child care block grant unless it demonstrates it will reduce the overpayment rate to 5% or below or make significant progress on the approved corrective plan.
The bill strengthens federal oversight to reduce CCDBG overpayments and protect child-care funding for eligible families, but it risks imposing compliance burdens on state agencies and could temporarily disrupt assistance for families in states that become conditionally ineligible.
Parents and children benefit because states must submit corrective plans to reduce CCDBG overpayments, which helps protect federal child-care funding for eligible families.
State and local governments are subject to increased reporting and Secretary oversight, improving accountability and transparency in how federal child-care dollars are used.
States with persistent high overpayment rates face conditional ineligibility, creating a stronger incentive for states to improve administration and reduce waste.
Parents and children could lose CCDBG-funded child-care assistance if a State is made conditionally ineligible while it fixes overpayment problems.
State and local agencies—especially small or under-resourced ones—may face increased administrative burden and may need to divert staff and resources to compliance, potentially delaying eligibility determinations or payments.
Introduced February 26, 2026 by Glenn Grothman · Last progress February 26, 2026