Congress·In Committee·H.R. 7721

New Bill Targets States with High Child Care Overpayment Rates, Threatens Funding Cuts

CRACKDOWN Act of 2026

24 days ago·View on Congress.gov

Part of: Bill Targets State Child Care Payment Errors with Mandatory Funding Cuts

Legislative Progress

House

Senate

President

Law

Key Points

This bill, introduced by Mr. Grothman, targets "improper payments" in state child care programs. These are payments made to the wrong people, in the wrong amounts, or for the wrong reasons.
If a state has an error rate higher than 5% in one year, it must submit a formal plan to the federal government explaining how it will fix these mistakes and lower the rate for the next year.
If a state fails to stay under the 5% error limit for two years in a row, it could lose its federal child care funding. This money is used to help low-income families afford child care so parents can work or go to school.
To avoid losing money after two years of high errors, a state must prove to the government that it is either going to hit the 5% goal next year or is making significant progress on its cleanup plan.
The policy is designed to reduce waste and ensure that tax dollars are used correctly, but it could put child care services at risk in states that struggle to manage the program's paperwork.

EducationEconomy Finance

Impact Analysis

Personal Impact

Who is affectedScoreImpactCertaintyScopeDurationSentiment

Scores: 1 = low, 5 = highSentiment: -5 to +5 (net benefit)

Milestones

2 milestones2 actions

Feb 26, 2026House

Referred to the House Committee on Education and Workforce.

Feb 26, 2026

Introduced in House

Related News

2 articles

The Hill·24 days ago

Grothman Introduces CRACKDOWN Act to Curb Child Care Fraud

Rep. Glenn Grothman (R-Wis.) introduced the CRACKDOWN Act on Thursday, aiming to reduce improper payments in federal child care programs. The bill mandates that states with error rates exceeding 5% must implement corrective action plans or risk losing federal funding for low-income families.

Politico·23 days ago

Advocates Warn CRACKDOWN Act Could Leave Families Without Child Care

Critics of the newly introduced CRACKDOWN Act argue that the 5% error rate threshold is too punitive. They warn that threatening to pull federal funding from states could result in thousands of low-income families losing access to essential child care services if administrative errors occur.

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Source Information

Document Type

Congressional Bill

Official Title

CRACKDOWN Act of 2026

Bill NumberHR 7721

Congress119th Congress

ChamberHouse of Representatives

Latest ActionReferred to the House Committee on Education and Workforce.

Sponsor

Data Sources

Congress.gov

Official legislative information

Analysis generated by AI. Always verify with official sources.