New HUD Grants to Fund On-Site Child Care for Affordable Housing Projects Through 2030

The Build Housing with Care Act of 2025 aims to solve two of the biggest headaches for working families—rent and child care—by literally putting them in the same building. The bill establishes a $100 million annual grant program through the Department of Housing and Urban Development (HUD) to fund 'co-location facilities.' These are buildings where affordable housing units and child care centers exist on the same premises or right next door. By authorizing $500 million over the next five years, the bill seeks to turn the 'commute' from the breakfast table to the daycare drop-off into a walk down the hall.

Two Birds, One Building

This isn't just about convenience; it’s about a serious cash injection for infrastructure. Under Section 3, HUD can award competitive grants of up to $10 million each to nonprofit developers, public housing agencies, and Tribal organizations. These funds can be used for everything from the initial design and planning to the actual construction or retrofitting of old buildings. For a parent working a double shift or a trade worker with a 6:00 AM start time, having a licensed provider in the building could mean the difference between keeping a job and being forced to stay home. The bill specifically targets 'child care deserts'—neighborhoods where there are three times as many kids as there are licensed spots—to ensure the money goes where the shortage is most acute.

The Fine Print on Eligibility

To get the cash, developers and providers have to play by specific rules. The child care partners must be eligible for federal vouchers, and the bill prioritizes centers that serve Head Start families or ensure at least 10 percent of their spots go to very-low-income households. There is a built-in protection for current residents, too: Section 3 requires a certification that the construction won't lead to evictions of people already living in the housing units. Additionally, the bill allows up to 10 percent of the grant money to go toward 'pre-development' costs, which is policy-speak for the expensive permits, architectural drawings, and environmental reviews that often kill these projects before they even break ground.

Mapping the Roadblocks

Beyond the construction grants, the bill orders the Government Accountability Office (GAO) to conduct a deep dive into why it’s currently so hard for public housing residents to find a babysitter. This study will look at how existing tax credits—like the Child Tax Credit and the Earned Income Tax Credit—are actually working for people on the ground. It also tasks the GAO with identifying state and local laws that act as 'barriers' to building daycare centers near public housing. By requiring a report within a year, the bill attempts to identify if the problem is just a lack of buildings or if there are bureaucratic red tapes, like zoning laws or licensing hurdles, that need to be cleared away to make these co-location projects successful in the long run.