The Fight to Keep Child Care Providers Open for Business in Wisconsin

During the COVID-19 pandemic, child care providers throughout Wisconsin received critical federal stabilization funding, money that supported over 5,700 programs, 75,000+ providers and 430,000 children, according to a report from the Wisconsin Early Childhood Association.

That support came at a critical time.

As providers adhered to regulations related to shut downs and more folks worked remotely, the childcare industry experienced a sharp drop in revenue and job losses.  As a whole, the industry began shrinking at around twice the rate of other sectors.

Despite strong advocacy from Wisconsin’s Early Care and Education (ECE) sector, parents, and businesses, the Wisconsin Legislature voted to discontinue the bridge gap funding program, which will now come to a close on June 30, 2026.

With the deadline looming, the report found that 1 in 4 providers are likely to close or significantly reduce their services.

“This support is not supplemental—it is foundational. I’m worried as this funding comes to an end because in a home-based childcare setting, there is very little cushion. Most of us are already operating with rising costs for food, learning materials, utilities, licensing requirements, insurance, and basic program supplies. The Bridge Payments helped balance those pressures so that I could stay focused on providing quality care instead of constantly worrying about whether I can sustain the program week to week,” a family child care provider was quoted as saying. 

Efforts Increase to Fill the Gap Left by Looming Expiration of Federal Funding 

Even prior to the pandemic, Wisconsin’s ECE sector was showing signs of distress.

By operating mostly as a private market system, the childcare industry had largely been anchored by its tuition fees.

However, in an effort to absorb the ongoing cost of living increases, which has seen prices for rent, food, utilities and supplies skyrocket, many facilities have been forced to raise their tuition costs by $1,300 to $2,600 per year per child, which in turn has threatened to price families out.

Combined with the historically low wages paid to early educators, which weakens the workforce even further, ECE programs throughout Wisconsin have been steadily reduced.

As the state begins winding down the Child Care Bridge Payments, many childcare programs may be forced to cut services, increase their fees even more, or close their facilities, putting stress on an already fractured industry, which never fully recovered in the aftermath of the COVID-19 pandemic. 

New Child Care Tax Credits Aims to Fill the Gap Left by the End of Federal Funding

There is hope, however.

“While the Wisconsin Legislature declined to approve continuing funding for child care like many other states that we compete against, they did recently pass 2025 WI Act 78 to allow businesses to claim a 15% tax credit for capital expenditures related to establishing a child care program, including one operated by third parties,” said Greater Beloit Economic Development Corporation (GBEDC) President and CEO Drew Pennington.

According to the bill, if a company builds or sets up child care for its employees, part of those startup costs, including renovating space, or the purchase of furniture or playground equipment, may qualify for a tax credit.  It would not cover standard operating expenses such as food, supplies, or employee wages.

At the federal level, the “Big Beautiful Bill” made important improvements to Section 45F of the tax code to increase the percentages of child care operating expenses and the maximum tax credit amounts that businesses can claim. In addition, the Wisconsin Legislature also approved 2025 WI Act 183 to allow Wisconsin-based businesses claiming the federal tax credit to claim the same against their state income-tax liabilities.

Ongoing Efforts to Support Working Families in Greater Beloit

In an ongoing effort to support our working families, GBEDC was proud to award the new Community Kids Stepping Stones Academy (SSA) a 2024 West Side Vitality Grant, critical funding that helped launch the facility.

The Academy, located at 825 Liberty Avenue, has immediate openings for children between 2-weeks and 12 years old with care provided between 6:30 a.m. to 5:00 p.m., Monday through Friday.

They will also offer kindergarten readiness starting on September 8, 2026. Held Monday - Friday from 9:00 a.m. to 12:00 p.m, over 437 hours of instruction will be provided by lead teachers holding a degree.

The programs will emphasize: 

• Academic skills
• Physical development
• Social-emotional growth
• Self-help abilities

Please call 608-313-1323 with questions or to register. 

Additional Childcare Providers in Greater Beloit

Residents throughout Greater Beloit are also encouraged to explore the Child Care Finder, an online database maintained by the Wisconsin Department of Children and Families.

Filters allow individuals to search for providers within a certain radius, choose between group centers, family providers and day camps, and also YoungStar ratings.

Are you a caregiver who has questions about childcare providers in Greater Beloit? Please contact GBEDC today for more information.