Final CCDF Rules Released: Federal Rollback of Child Care Protections & What It Means for California

Today, May 12, 2026, the Trump Administration released a final rule for the Child Care and Development Fund (CCDF), rescinding regulations designed to strengthen payment practices for child care providers and ensure families relying on subsidies can equitably access care.

While titled "Restoring Flexibility," this rule is a significant rollback of Biden-era protections that provided financial stability for providers and affordability for the families we serve. None of these changes are surprising; we anticipated this outcome and have been tracking these developments closely. While states may choose to maintain these policies, they are no longer federally required to do so.

What Policies Are No Longer Required?

The following federal protections, established in March 2024, are rescinded effective July 13, 2026:

• 7% Co-payment Cap: The federal ceiling preventing families from being charged more than 7% of their income for child care has been eliminated.

• Enrollment-Based Payments: States are no longer required to pay providers based on authorized enrollment rather than physical attendance.

• Prospective Payments: The federal requirement that states pay providers in advance has been removed.

• Direct Service Grants: The mandate to use grants or contracts specifically for infants, toddlers, and children with disabilities has been rescinded.

What This Means for California

We do not anticipate California enacting these rollbacks. The state has already implemented most of these protections and has made clear its commitment to maintaining them. The one exception is prospective payments, which California has not yet implemented, and this rule removes any federal pressure to do so.

We are also watching the Governor's May Revise closely, which will be released on May 14, as some of these issues may surface in the state budget discussion. We will keep you informed as developments unfold.

As always, EveryChild CA will continue to monitor and advocate on your behalf.