WASHINGTON, DC – Today, Senator Jacky Rosen (D-NV) announced that the National Head Start Association, the First Five Years Fund, and the National Association of Government Guaranteed Lenders are endorsing the Small Business Child Care Investment Act, which Senator Rosen introduced with Senator Joni Ernst (R-IA). This bipartisan legislation would increase the availability of affordable, high-quality child care to working families by allowing non-profit child care providers that qualify as small businesses to participate in Small Business Administration (SBA) loan programs.
“Families need better access to high-quality early childhood education and care,” said Yasmina Vinci, Executive Director of the National Head Start Association. “As the nation’s flagship early learning program, the Head Start community knows this all too well. This bipartisan legislation will allow providers like Head Start to invest in their facilities, so they can maintain and expand operations and ensure they have all the resources needed to continue serving children and their caregivers.”
“One of the biggest challenges many working families face today is finding available, affordable child care. When child care challenges determine whether or not parents can go to work, it affects businesses and our overall economy,” said Sarah Rittling, Executive Director of the First Five Years Fund. “Nonprofit child care providers are critical in helping to meet the need, but too often they face barriers that prevent them from establishing or expanding care. We are pleased to see Senators Rosen and Ernst work together to find innovative solutions to expand access to affordable, quality child care by allowing nonprofit providers to access the same financial resources available to for-profit providers.”
“Supporting affordable child care is critical to the country’s economy and to the survivability of our small business ecosystem. And very often, child care facilities are established as non-profit entities, creating hurdles for these small businesses themselves when it comes to access to capital,” said Tony Wilkinson, CEO & President of the National Association of Government Guaranteed Lenders (NAGGL). “The Small Business Child Care Investment Act helps to solve the access to capital challenge when it comes to many of our country’s child care small businesses, and NAGGL applauds Senators Rosen and Ernst for their leadership on this important issue facing our country’s young families, employers, and child care facilities.”
Currently, non-profit child care providers do not have the same access to the types of SBA loans that for-profit providers do:
- Under current law, only certain non-profit child care providers may apply for the SBA’s microloan program, which is capped at $50,000 and cannot be used to purchase real estate or for existing debts. Other SBA loan programs are off-limits to non-profit child care providers, even if they are small businesses that would otherwise be eligible for access to capital programs if they were a for-profit entity.
- For-profit providers can access the larger and more flexible loan programs like the 7(a) and 504 programs that can range up to $5.5 million in capital support and can be used for real estate, construction, remodeling, and other expenses critical to maintaining and expanding high-quality child care operations.
The bipartisan Small Business Child Care Investment Act would:
- Ensure that qualified non-profit providers have equal access to key SBA loan options that allow providers to invest in and expand their operations, which creates local jobs and gives working families more options for affordable and quality child care;
- Ensure non-profit providers can access the larger and more flexible loan programs like 7(a) and 504 that can be used for real estate, construction, remodeling, and other expenses critical to maintaining and expanding high-quality child care operations.
A recent report labeled the entire state of Nevada as a “child care desert,” and found that nearly 75 percent of children below the age of five don’t have access to a licensed child care provider. The report deemed the cost of child care a “huge concern” in Nevada and found it often to be more expensive than college tuition. It also attributed the lack of affordable and accessible child care as a factor behind the worker shortage that Nevada businesses report experiencing.