To allow nonprofit child care providers to participate in certain loan programs of the Small Business Administration, and for other purposes.
Sponsors
Legislative Progress
ReportedReported by Ms. Ernst, with an amendment
Ms. Rosen (for herself, Ms. Ernst, Mr. Risch, and Mr. …
Summary
What This Bill Does
The Small Business Child Care Investment Act allows nonprofit child care centers to borrow money through the Small Business Administration'''s loan programs. Currently, these programs are only available to for-profit businesses. This bill creates a new category called "covered nonprofit child care providers" that can access SBA 7(a) loans and 504 loans, provided they meet specific requirements including state licensing, 501(c)(3) tax-exempt status, and criminal background checks for all staff.
Who Benefits and How
Nonprofit child care centers benefit by gaining access to SBA-guaranteed loans of up to $500,000 (or more with additional guarantees) to expand their facilities, purchase equipment, or improve operations. Banks and certified development companies benefit from additional lending opportunities with government-backed guarantees. Working families and communities benefit indirectly from increased child care capacity, as nonprofit providers can invest in growth and improvements they previously couldn'''t afford.
Who Bears the Burden and How
The Small Business Administration faces increased administrative work, including processing loans for a new category of borrowers and submitting annual reports to Congress detailing loan activity. Taxpayers bear potential financial risk, as they back the loan guarantees - if nonprofit child care providers default on their loans, the federal government must pay the lenders. However, loans under $500,000 don'''t require additional guarantees, potentially increasing risk exposure.
Key Provisions
- Nonprofit child care providers that are 501(c)(3) organizations, meet state licensing requirements, and comply with SBA size standards can now apply for SBA 7(a) and 504 loans
- All loans must be made through participating banks or certified development companies (no direct lending from SBA)
- Loans over $500,000 require an additional guarantee from another person or entity; loans under $500,000 do not
- Religious organizations cannot be denied loans based on their faith affiliation, but loan funds cannot be used for religious activities
- The SBA must report annually to Congress on the number and dollar amount of loans made to nonprofit child care providers
Evidence Chain:
This summary is derived from the structured analysis below. See "Detailed Analysis" for per-title beneficiaries/burden bearers with clause-level evidence links.
Primary Purpose
Allows nonprofit child care providers to participate in Small Business Administration loan programs (7(a) and 504) for business financing.
Policy Domains
Legislative Strategy
"Expand access to SBA financing for nonprofit child care providers to address child care shortage and support working families"
Likely Beneficiaries
- Nonprofit child care centers (501(c)(3) organizations)
- Working families needing child care
- Small Business Administration lenders (banks, certified development companies)
Likely Burden Bearers
- SBA (increased loan guarantee exposure and reporting requirements)
- Taxpayers (potential exposure from guaranteed loans)
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_administrator"
- → Administrator of the Small Business Administration
- "the_administrator"
- → Administrator of the Small Business Administration
- "the_administrator"
- → Administrator of the Small Business Administration
Key Definitions
Terms defined in this bill
An organization that: (1) complies with state licensing requirements for child care; (2) is a 501(c)(3) tax-exempt organization; (3) is primarily engaged in providing child care for children from birth to compulsory school age; (4) complies with SBA size standards; (5) ensures employees/volunteers pass criminal background checks; (6) may provide school-age care or preschool programs; and (7) certifies non-discrimination in business practices.
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology