CRACKDOWN Act of 2026
New Bill Targets States with High Child Care Overpayment Rates, Threatens Funding Cuts
Legislative Progress
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.
Impact Analysis
Personal Impact
Life & Work
Small child care providers could be indirectly harmed if states tighten eligibility rules or slow down payments to families in order to meet the 5% overpayment threshold. States under pressure to reduce error rates may add more paperwork and verification steps, which could delay reimbursements to small child care businesses that depend on timely subsidy payments to stay afloat.
Programs
Milestones
Placed on the Union Calendar, Calendar No. 507.
The bill is now on the schedule for the full chamber to consider. It's in line for debate and a vote.
Reported (Amended) by the Committee on Education and Workforce. H. Rept. 119-587.
Ordered to be Reported (Amended) by the Yeas and Nays: 19 - 15.
The committee approved this bill and is sending it to the full chamber for a vote. This is a significant step — most bills never get this far.
Committee Consideration and Mark-up Session Held
Referred to the House Committee on Education and Workforce.
Votes
No votes have been recorded for this legislation yet.
Related News
2 articlesGrothman 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.
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.
Source Information
Document Type
Congressional Bill
Official Title
CRACKDOWN Act of 2026
Data Sources
Sponsor
Analysis generated by AI. Always verify with official sources.