State & Federal Updates:  Child Care

We know many providers and educators have seen recent national headlines and social media chatter about alleged child care fraud in Minnesota and rumors that federal child care funds could be “frozen.” We’ve been in direct communication with Delaware DHSS/DSS to help ensure you have accurate, timely information.

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Here’s what we know as of today:

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• Delaware has not been told there will be a universal freeze of child care funds or payments to Delaware. DHSS shared that their federal partners did not mention any across-the-board freeze for our state.

• The federal Administration is initiating additional verification steps tied to something being referred to as “Defend the Spend.” DHSS noted this is not new and Delaware has navigated similar processes in the past.

• Provider payments are not expected to be impacted overall, but DHSS shared that payments could be delayed at times depending on federal processing.

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Click to read more. 

On behalf of the Delaware Association for the Education of Young Children (deaeyc) and the thousands of early childhood professionals we represent, we are writing to express our deep concern regarding recent legislative measures, including House Bill 242, that allow for higher commercial property tax rates on commercially owned land in New Castle County.
 
While we understand the intent to address residential property tax burdens, we fear that the resulting increase in corporate property tax rates will have unintended and harmful consequences for small businesses—particularly child care providers—across Delaware.

Click to read more. 

On May 30, the White House released its official budget request for Fiscal Year 2026, with supplemental information following a week later in the Congressional Justification for the newly renamed Administration for Children, Families, and Communities (ACFC).

Overall, the budget request for the Department of Health and Human Services is $93.8 billion, a reduction of $33.3 billion or 26.2%. Funding for the Child Care and Development Block Grant (CCDBG) and the Head Start program did remain at levels equal to FY25, while funding for the Preschool Development Grant Birth through Five (PDG B-5) program was eliminated.

Click to read more. 

The Delaware Association for the Education of Young Children (deaeyc) is expressing serious concern following Governor Matt Meyer's FY26 budget reset, which includes no funding increase for early care and education, state-funded pre-K, or the Purchase of Care program.
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This marks a stark departure from the Carney administration, where annual investment for these essential programs increased from between $10- $20 million, nearly doubling state investment by the end of their second term. It is worth noting that the increases from the previous budgets were an attempt to make up for a lack of funding over the last three decades.
 
The elimination of additional investment in the current budget comes at a time when the early childhood sector faces mounting financial pressures and growing uncertainty around potential federal cuts to Head Start and the Child Care and Development Block Grant (CCDBG).
The full press release can be found here: Press Release: Budget Reset

The Department of Health and Social Services and the Department of Education have confirmed with the Office of the Governor that the federal funding freeze memo has been rescinded as of January 29, 2025.
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All payments that are supported by federal funding will continue uninterrupted at this time. This includes Purchase of Care payments, Child and Adult Food Program, and Head Start payments directly to programs from the federal government. 
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State Funded Early Care and Education partners receive state funds only; therefore, they would not be impacted by a freeze of federal funds. 
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Read deaeyc's full statement

The White House Office of Management and Budget has rescinded a Trump administration directive pausing federal loans, grants and other financial assistance, a White House official said on Wednesday.

Governor Matt Meyer recognizes there is a lot of confusion and concern surrounding the recent federal funding freeze. We want to hear from you. Click this link or call our office at (302) 577-3210 to share your comments, stories, and information about how this federal executive order is affecting you, your organization, your business, or your family.

Please find information shared by the National Head Start Association:  Press Release

Congress has left DC without reaching an agreement on FY26 appropriations (due January 30, 2025) or addressing the expiration of health care subsidies at the end of this month. Senate leaders' push to advance a five-bill minibus covering Defense, CJS, Interior-Environment, Labor-HHS, and THUD remains stalled.

The House passed its GOP-led health care package Wednesday night, though the Senate has no plans to take it up. Additionally, moderate Republicans joined a Democratic-led discharge petition to secure a clean three-year extension of the subsidies. Meanwhile, moderate rank-and-file members in both chambers are working to develop a last-minute consensus plan that could pass both chambers. But nothing could come together until January, when Congress will have less than a month until the next funding cliff. Approximately 24 million people will see their premiums increase without Congressional action.

• New Data Highlight Risks to Children and Parents if Enhanced Marketplace Subsidies Expire – Center For Children and Families

• Local data: Marketplace Enrollees In Every Congressional District Face Steep Premium Increases Unless Tax Credit Enhancements Are Extended | Center on Budget and Policy Priorities

Right now, Congress is making decisions on how much federal funding ECE programs like CCDBG, Early Head Start & Head Start will receive next year, an annual process known as appropriations. We urge Congress to enact the Senate version of the FY26 LHHS spending bill, which includes increases to CCDBG and Head Start, and maintains CCAMPIS and PDG. A yearlong Continuing Resolution, or the House version, would result in cuts to funding for critical programs. More: NWLC Action Fund Applauds Bipartisan Proposal to Protect Child Care Funding and Public Education in FY26 Budget. 

State-by-state data: House Proposed Level Funding for CCDBG Would Mean Nearly 50,000 Children Lose Access Since Last Increase | CLASP

More: Child Care at Risk: How Federal Funding Cuts—and Government Shut Down— Hurts Families and Home-Based Providers | Home Grown Child Care

Now is the time to tell Congress that children, families, and educators need investments, not cuts.

            ⇒ Take Action: Tell Congress: No Cuts to Child Care! (NWLC)

Despite strong advocacy from DEAEYC and our partners, the FY26 budget includes no increase in funding for early care and education, the Purchase of Care subsidy, or Delaware’s state-funded Pre-K programs.
Throughout this year’s budget process, DEAEYC repeatedly urged the Meyer administration, the Joint Finance Committee, and members of the General Assembly to prioritize early childhood education.

We emphasized that investments in early care are essential to Delaware’s economy, workforce, and the well-being of young children and their families. Unfortunately, those calls were not reflected in this final budget.


Click to read more. 

Governor Matt Meyer included remarks on the importance of early care and education during his State of the State address today. We must ensure that the state budget also shows the importance of the work being done by early care and education providers across the state.  
 
We must increase investment before we see a reduction in access to care, especially to those most vulnerable who need it the most. We must support the workforce and providers. We must reduce the burden that families have in paying for early care and education. We must invest now.  
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Let's work together, Governor Matt Meyer to innovate and build the best early care and education system in the nation. 
 
See his remarks here.

Delaware Department of Education released a website with guidance and resources for educators and families concerned about immigration action in child care facilities. This website links to the Attorney General Office's guidance for businesses and organizations.
The website can be accessed here: Delaware immigrant children guidance for early care and education

U.S. District Judge Loren L. AliKhan blocked the funding freeze only minutes before it was scheduled to take effect. The administrative stay, prompted by a lawsuit brought by nonprofit groups that receive federal money, lasts until Monday afternoon. Another court hearing is scheduled that morning to consider the issue.

WHITE HOUSE FAQs

Click here to read deaeyc's response.
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Early education and child care providers are crucial to Delaware’s workforce and economy. The 
funding pause could affect a wide range of programs that support lower-income households, 
including Temporary Assistance for Needy Families, state grants for child care, Head Start, the Child 
and Adult Care Food Program, and the Special Supplemental Nutrition Program for Women, Infants, 
and Children (SNAP/WIC). 
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Sent 1/28 at 7:00PM

Dear Early Childhood Providers,
 
We have heard concerns about the federal funding pause. We will share additional information and guidance as we receive it.
 
Thank you,
Department of Education, Early Childhood Support team