Protecting Childcare from Private Equity Act

Key Points

• Large private investment funds that own more than 25 childcare centers and manage over $150 million would have to report ownership and sale data to the SEC every year.
• Once a large fund buys a childcare business, it cannot sell that business for four years, which is meant to stop quick buy-and-flip deals that can destabilize care for families.
• During that same four-year period, the childcare business cannot pay dividends, distribute capital, or buy back shares from the fund that owns it, keeping money inside the center instead of flowing out to investors.
• The Government Accountability Office must study how private equity ownership affects care quality, tuition, availability of spots, and worker wages, and report findings to Congress within two years of enactment.
• The rules only apply to large funds with more than $150 million in assets that control more than 25 childcare locations, so small local childcare providers are not affected.