New Tri-Share Child Care Pilot Funds $250M Annually: Parents, Employers, and States Split the Bill

The newly proposed Tri-Share Child Care Pilot Act of 2025 is a 3-year, $750 million experiment designed to tackle the crushing cost of child care. Essentially, the bill creates a federal grant program that allows participating states to split the cost of child care three ways: one-third paid by the working parent, one-third by their employer, and one-third by the state government. This is a significant move that could dramatically cut child care expenses for eligible families.

The Three-Way Split: How the Money Moves

This pilot program is funded with a hefty $250 million appropriation for each of the three years it runs. States apply for grants, and if approved, they become the central administrator. The state’s lead agency for child care will pay the full cost of care directly to the provider chosen by the parent. This is a key detail: providers get paid upfront and in full by the state, which is great for their stability. However, the state then has to collect the other two-thirds—the parent’s share and the employer’s share—as a reimbursement. The bill specifies that the parent can consent to having their one-third deducted from their paycheck, provided the employer then sends the full two-thirds (their share plus the employee’s share) back to the state. This complex payment flow means state agencies will need robust administrative systems, possibly using third-party administrators, to manage the cash flow and tracking.

Who Gets the Discount, and Who Misses Out?

The biggest catch is eligibility. This program isn't for everyone; it targets a specific income bracket. To qualify, a child must be under kindergarten age and have a parent working for a participating employer. Crucially, the family’s income must be above the state’s threshold for the existing Child Care and Development Block Grant (CCDBG) assistance, but not more than 300% of that threshold. This means the pilot is aimed squarely at the moderate-income families—often the ones who earn too much to qualify for traditional subsidies but still struggle significantly with child care costs. For a family earning $80,000 a year in a high-cost area, cutting their $1,500 monthly child care bill down to $500 is a game-changer.

However, this focus creates an income cliff. If you’re a parent just below the CCDBG threshold, you’re still relying on that program. If you’re just above the 300% limit, you get no help at all. The bill does include a provision requiring a feasibility study on using a sliding scale for the parent's one-third contribution, which suggests lawmakers recognize the fixed one-third share might still be too much for some lower-income participants.

The Employer Buy-In

Employer participation is voluntary, but necessary. States must show they have committed employers and a plan to recruit more when they apply for federal funding. For employers, this program is a major new benefit they can offer to attract and retain staff. By covering one-third of a key employee’s child care costs, they are making a direct investment in keeping that person employed and productive. This is particularly attractive to businesses struggling with high turnover, as the state is essentially matching their contribution. The cost-sharing mechanism makes it much cheaper for a company to offer child care support than trying to run an on-site center or subsidize the full cost themselves.

Implementation Challenges and Real-World Impact

While the goal is noble—reducing a massive financial burden—the bill introduces significant administrative complexity. The state must verify the parent’s employment and income, approve the parent’s application, pay the provider, and then chase down the two-thirds reimbursement from the parent and the employer. For parents, while the cost reduction is huge, they must still pay their one-third share, which, for many, is still hundreds of dollars a month. The provision allowing employers to withhold the parent’s share from their paycheck simplifies the state's collection process but also gives the employer more control over the employee's finances. The bill requires states to ensure equitable geographic access, which is crucial to prevent the funds from only benefiting dense urban areas where employer participation might be easier to secure. Ultimately, the success of this pilot hinges on whether states can manage the complex payment structure and whether enough employers step up to participate.