No Funds for Repeat Child Care Violations Act of 2026

No Funds for Repeat Child Care Violations Act of 2026 (H.R. 7726)

Main purpose and intent

• To amend the Child Care and Development Block Grant Act of 1990 (CCDBG) to require the Secretary of Health and Human Services to withhold funds from states that have repeated fraud findings or persistent noncompliance in administering CCDBG programs.
• The bill moves from a discretionary withholding authority to a mandatory, or at least stronger, sanctioning framework for noncompliance and fraud.

Key provisions and changes

• Section 2 (Strengthening the authority to withhold funds for fraud):
  • Rewrites 658I(b)(2)(B) of CCDBG so that the Secretary “shall” impose sanctions for repeated noncompliance or fraud, rather than the current “may”.
  • Sanctions can include: recoupment of funds improperly expended, deducting funds from a state’s administrative portion of the next CCDF allotment, and additional sanctions such as disqualification from CCDBG financial assistance.
  • The Secretary may also impose other appropriate sanctions beyond the above, including recoupment of improper payments and disqualification from CCDBG funds.
  • The Secretary must provide notice and an opportunity for a hearing before findings of noncompliance trigger sanctions.
  • The bill authorizes rulemaking to establish procedures for handling complaints and imposing sanctions.
  • Waivers for up to three years may be granted if specific conditions are met (conflicting requirements, extraordinary circumstances, etc.), with a defined process for approval, renewal (up to one year), and termination if relief is no longer necessary or performance is inadequate.
  • External conditions: waivers cannot be used to alter eligibility requirements for CCDBG-eligible children or to waive parental work/training/education requirements that apply to families.
• Administrative alignment:
  • The bill preserves existing mechanisms under CCDBG for monitoring, audits, corrective action plans, and enforcement but shifts the balance toward mandatory sanctions for repeat noncompliance.

Who or what would be affected

• Primary: States and their CCDBG Lead Agencies administering the CCDF program.
• Direct impact: States with repeated findings of fraud or noncompliance could face withholding or recoupment of CCDBG funds, and potential disqualification from receiving CCDBG assistance.
• Indirect impact: Child care providers and families relying on CCDBG-funded services could experience changes in funding levels or access if states are penalized, potentially affecting the availability of subsidized child care.
• Oversight and administration: HHS/ACF (Administration for Children and Families) would implement the mandatory sanctions and the accompanying policy framework.

Procedural and timeline aspects

• Introduced: February 26, 2026 by Rep. Mary Miller (R-IL).
• Committee action: Feb. 26, 2026 referral to the House Education and Workforce Committee; March 5, 2026 committee markup and amendment; reported amended to the House (yea 20, nay 15).
• Floor action: Placed on the Union Calendar on April 6, 2026; awaiting consideration by the full House.
• Additional context from the committee report:
  • The accompanying report notes a purpose of deterring waste, fraud, and abuse and ensuring accountability for federal child care funds.
  • The minority views warn that the bill could overstate or politicize fraud concerns and disrupt the CCDBG safety net for working families.

Notable points from supporters and critics

• Supporters (as reflected in the committee report):
  • Emphasize protecting taxpayer dollars from fraud and ensuring state accountability.
  • Argue that the current discretion in sanctions is too weak to deter repeat fraud or noncompliance.
• Critics (minority views in the report):
  • Argue the bill could unjustly strip funds from states and harm the child care system, potentially reducing access for families.
  • Caution that there is limited publicly verified evidence of widespread fraud, and that imposing automatic sanctions could exacerbate the child care shortage.

Summary

H.R. 7726 seeks to harden federal enforcement of CCDBG program integrity by mandating sanctions, including potential fund withholding and disqualification, for states with repeated fraud findings or substantial noncompliance. It replaces discretionary authority with a “shall” standard for the Secretary and establishes a process for hearing, sanctions, and waivers. The bill aims to safeguard federal child care dollars but has raised concerns about potential adverse effects on the availability of subsidized child care for families if states are penalized for administrative issues or isolated noncompliant incidents.