The Child Care Modernization Act of 2025 overhauls the federal child care assistance program through 2030 by expanding eligibility to include homeless children and those in kinship care, allowing states to offer child care through diverse providers (faith-based organizations, public schools, and community groups) to increase parental choice, and requiring states to develop payment rates based on actual service delivery costs by 2031. The bill strengthens support for underserved populations—including low-income, rural, and foster children—while requiring states to invest in workforce recruitment and training, waive certain income limits to serve more families, and establish a new grant program to help providers start operations and improve facilities in underserved areas. States must also consult with parents, providers, employers, and local governments when planning services and report regularly on progress toward improving access, affordability, and provider compensation.
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