NEWS: Daycare Funding Freeze Creates Questions, Provides Few Answers
A scandal in Minnesota led the Trump Administration to freeze federal childcare funds to all 50 states. When that money will again flow and what the new requirements will be are unclear.
By Martin Davis
EDITOR-IN-CHIEF
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Over the holiday break, the federal government announced it would be freezing federal dollars for childcare programs in all 50 states.
The freeze is the result of a video released on December 26, 2025, that purportedly showed empty Somali daycare centers in Minnesota that were receiving federal daycare funds for services not provided. Those claims are being disputed by Minnesota investigators
According to NPR, to again receive funds, states will need to “provide more verification and administrative data about the programs.” As of now, however, there’s little guidance as to what that means.
The Advance reached out to political and educational leaders to learn more about what they know about the funding freeze and who will be affected.
What Funds Are Affected?
The federal dollars that support daycare for needy families flow through the Child Care and Development Funds (CCDF). According to Del. Phillip Scott (HD- 63), Virginia is “budgeted to receive ~$274m, … according to Budget Item 125.10” in 2026.
Those funds, he said, are “distributed by the Department of Education in many different places, but the bulk of those are direct childcare services of varying kinds.”
According to the Update on Early Childhood in Virginia reported to the Senate Finance and Appropriations Committee in January of 2025, CCDF funds benefit 44,141 children. Infants/toddlers make up 28% of these children, preschoolers 40%, and school-aged children 6-13 years old make up 32%.
For a more-detailed account of CCDF and its structure, see this fact sheet put together by the Bipartisan Policy Center
When Will CCDF Funds Begin to Flow Again?
The Trump Administration said that the funds will begin to flow when states meet higher verification thresholds.
An announcement today by the federal Administration for Children & Families said that the previous policy of basing payments on enrollment would be rolled back. Now, payments will be based on verified attendance. Further, payments will be provided after care is provided, and not upfront.
These changes, however, are subject to a 30-day public-comment period. Whether funds will flow prior to the 30-day comment period is not specified.
Asked how quickly he expects Virginia to meet the higher reporting thresholds the federal government is demanding once set, Del. Scott said he is confident that Virginia will be able to provide the necessary information quickly so that funding can be re-established.
“Virginia is famous for our smooth transitions of power,” he said, “and we should be able to produce the necessary records quickly and effectively even with the transition of power from Governor Youngkin to Governor Spanberger.”
What Will Be the Short-term Effects?
As for how the funding freeze will affect organizations in the near-term, there are more questions than answers.
Gina Davis leads Foundation First, a nonprofit organization focused on strengthening early childhood care and education systems across Virginia. She told the Advance via email that, regarding the funding freeze, “We have not had any updates from our state partners at this time” about the pause.
Spotsylvania County Schools Superintendent Clint Mitchell told the Advance via email that, “At this time, we have not received any official communication from the federal government regarding a freeze on daycare funds or how it might impact our Head Start program.”
For now, he wrote, the district is “monitoring the situation closely and will review any guidance or directives from the Department of Education or the Office of Head Start as soon as they are released.”
Del.-elect Nicole Cole told the Advance via email that while serving on the Rappahannock YMCA Board, she came to appreciate how dependent the organization is “on income from daycare (after school, vacation and summer day care) services.”
What is unclear at the moment, she wrote, “is how federal funds that flow to state agencies impact larger providers like the YMCA.”
Should the Y, “as the single largest provider in our region and state [be] negatively impacted, then I know smaller providers supported through funds state agencies receive will be devastated.”
The Advance reached out to several childcare organizations but has not connected with anyone as of publication. However, Cindy Lehnhoff, director of the National Child Care Association, told North Carolina Public Radio in an interview on January 2 that “providers are extremely concerned, as they should be, that they are not going to be able to remain open if there are any delays in receiving their subsidized payments for the children that they care for that fall under the CCFD funding.”
She noted that 90% of childcare providers are small businesses that “basically live paycheck to paycheck.” She further noted that “70% of [funds daycare providers receive from CCFD are] used to pay their employees. This is an industry that is very labor-intensive because of the low child-teacher ratios that are needed to keep children safe while they're in care and in healthy environments. So this is going to keep them from … paying their expenses.”
This is an evolving story. Stay with the Advance as more information becomes available.
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I'm grateful for this reporting at the Advance. Thank you Marty and Adelle for all that you do
Wouldn't it be nice if Republicans used the same hypervigilant approach - stopping all subsidies to businesses, banks, and billionaires whenever there is the slightest hint of fraud or abuse as they do when it gives them an opportunity to torment working class people?
A video of questionable content shows up on the internet, and over a holiday weekend, and Republicans use it as an opportunity to stop critical support for the daycare infrastructure that working class parents need, without notice, investigation, or debate.
Support that honest, hardworking American parents need, so that they can work?
And now the kult can use the leverage of that needed money, that comes from us - the taxpayers by the way - to pick and choose who gets it back, based upon their loyalty to the klan?
You know, sorta like they've done with FEMA moneys, tuition, research, etc.
Be nice if the same standards were applied for money sent to voucher programs, tax breaks for "non-profit" lobbying groups, corporate tax breaks, etc.
But even then, the law should be applied evenly, based upon the law itself, not because of who fawns over their cult god President the loudest, or who pays the most in "contributions".
The greediest, cruelest, most sniveling drug cartel or criminal gang pales in comparison to today's Republicans.
How proud they must be....