Trump Unveils New Plan to Lower Cost of Child Care for Low-Income Americans

FIRST ON THE DAILY SIGNAL—The Trump administration is advancing policies to reduce the burden of child care costs on low-income families, The Daily Signal has learned.

The Administration of Children and Families, a division of the Department of Health and Human Services, will issue a combination of new rules and guidance to states in order to empower parents in their children’s day care options. 

“We want to address what is a major cost crunch for a lot of families with young children,” a White House official told The Daily Signal. “Child care eats up a pretty significant chunk of a family’s budget. In some cases, it can compete with the cost of rent or a mortgage, student debt. It’s a significant payment.” 

The new child care policy package seeks to reduce regulations so providers can run their businesses more efficiently, so they could pass the savings on to American families. For instance, the guidance will eliminate degree and credit-hour requirements for teachers, shifting instead to competency-based standards. Mandatory staff-to-child ratios and group-size limits will be replaced so that parents can make those choices for themselves. 

The Trump administration’s goal is to increase parent-directed child care by restoring flexibility to states and encouraging greater use of vouchers.

“We want to encourage choice and competition for parents through the promotion of voucherization, and we want to ensure that to the maximum extent possible, faith-based and community neighborhood-based providers, including home-based providers, are able to participate in these programs on equal footing,” the official said.

Licensing restrictions can hold back faith-based providers, according to the official. The guidance aims to put faith-based providers on equal footing with larger ones.

“[Licensing restrictions] operate as a form of regulatory capture from some of the larger center-based child care providers in ways that can box out faith-based providers that just don’t have access to the same resources, don’t have as much capital, or the same pool of labor to necessarily be able to tap,” the official said. 

The notice of proposed rule making will be finalized in the next week. Governors and state legislatures will also receive letters urging them to carry out the reforms in a way that benefits local residents. 

While Congress holds the majority of the power to impact child care costs, ACF is able to amend regulations and the administration of federal programs, including Head Start, Child Care and Development Fund, and Temporary Assistance for Needy Families. 

The Trump administration is also working to support stay-at-home parents through the guidance. Currently, the work requirements for married couples under the Temporary Assistance for Needy Families, or TANF, program are stricter than they are for single parents, making it more difficult for low-income parents to choose to stay home with their kids.

Through subregulatory guidance, ACF will clarify for states that married couples can share the work requirements. 

“There are a lot of families, particularly low-income families, who may not necessarily want to drop their child off at a center-based child care provider, or any child care provider, and would prefer to stay at home,” the official said. “We’re trying to increase the amount of flexibility that low-income families can receive to have a part- or full-time stay-at-home parent to watch their child within the home.” 

The guidance eliminates the 7% co-payment requirement on federal child care programs and encourages states to maximize lawful transfers from TANF and Social Services Block Grants into the Child Care and Development Fund in order to expand access to the fund’s vouchers and reduce waitlists. 

“We want to also clarify that federal law does not require states to disadvantage state-law-approved child care models, just so long as basic health, safety, and integrity standards are met,” the official said. 

The policy package has been a collaborative effort between the Office of Management and Budget, the White House, and ACF.

The president’s fiscal year 2026 budget proposed a set of reform principles for Head Start, and the policy changes are consistent with those, the official said. 

Alex Adams, assistant secretary for ACF, told The Daily Signal in April that he has cut 36,000 pages of regulation.