affordable

Press Release:

Congresswoman Claudia Tenney (NY-24) today, with Congressman Brad Schneider (IL-10), introduced the Promoting Affordable Childcare for Everyone (PACE) Act to update federal childcare incentives and improve access to affordable and high-quality childcare for American families.

The PACE Act would modernize the Child and Dependent Care Tax Credit and enhance Dependent Care Flexible Spend Accounts (FSAs) to make the credit refundable and allow for annual updates to keep both incentives effective and provide more financial support for working parents.

“Families shouldn’t have to jeopardize their finances to enroll their children in quality childcare,” said Congresswoman Tenney. “The current federal childcare incentives have not kept up with the rising costs plaguing hardworking families and sometimes rival college tuitions. This pro-family bill updates federal childcare incentives, expands accessibility, and ensures lower-income and working families can provide quality care for their children. On top of that, our legislation will enable parents to go back to work, helping to combat our nationwide worker shortage.”

“It is hard to find quality, affordable child care – and when workers can’t afford child care, they can’t pursue work opportunities, take care of a loved one, or attend college," said Congressman Schneider. "We need to make child care less expensive, which is why I’m proud to introduce the bipartisan PACE Act with my colleague Rep. Claudia Tenney. This important legislation would directly provide working families with money in their pocket to put towards child and dependent care."

"Working families continue to struggle with the costs of child care," said Radha Mohan, Executive Director of the Early Care and Education Consortium. "A lack of access to high-quality, affordable child care means parents cannot participate in the workforce. The bipartisan PACE Act helps working families pay for child care by expanding and modernizing the Child and Dependent Care Tax Credit and increasing the amount of pre-tax dollars families can set aside in Dependent Care Flexible Spending Accounts. Childcare providers applaud Reps. Tenney and Schneider for introducing this bill."

“The bipartisan Promoting Affordable Childcare for Everyone (PACE) Act is a crucial step to supporting families with young children while ensuring greater economic stability across the country,” said FFYF Executive Director Sarah Rittling. “The Child and Dependent Care Tax Credit (CDCTC) is the only provision of the tax code specifically created to help working parents afford child care. Together with expanded Dependent Care Assistance Plans (DCAP), enhancing the CDCTC and ensuring its refundability will help ease the burden of the cost of child care for families who truly need it most. We are so grateful for the bipartisan leadership of Reps. Tenney and Schneider, in coming together to introduce the PACE Act and helping America’s young children and their families find and afford the care they need."

“It is critical that federal tax incentives intended to support access to child care meet the needs of the nation’s workforce,” said Linda K. Smith, Director of the Early Childhood Initiative at the Bipartisan Policy Center. “We applaud Representatives Tenney (R-NY) and Schneider (D-IL) for their leadership in introducing bipartisan legislation that enhances the Child and Dependent Care Tax Credit (CDCTC) and increases the Dependent Care Assistance Plan cap to better support low- and middle-income working families. The PACE Act makes meaningful changes to help both businesses and working parents meet the demands of today’s economy.”

Child and Dependent Care Tax Credit (CDCTC):

• Makes the credit refundable in order to expand the credit’s reach to working parents.
• Enhances the value of the credit for working parents through an increase in the credit rate.
• Indexes the credit to inflation to ensure the value of the credit will not be eroded over time by rising childcare costs.

Dependent Care Flexible Spend Accounts (DCFSAs):

• Increases the amount of pre-tax dollars parents can put into the accounts from $5,000 to $7,500. 
• Indexes the new cap to inflation so DCFSAs can keep pace with the cost of childcare.