Texas Senate Bill SB2164

Texas 2025 - 89th Regular

• Filed: 3/10/25

Caption

Relating to employer incentive payments for child care for employees, including creating an employer child-care contribution partnership program and a franchise tax credit for taxable entities that make certain employer child-care contributions; authorizing a civil penalty.

Impact

The bill introduces significant amendments to the Labor Code and the Texas Tax Code, establishing a structured financial mechanism to not only support employees but also incentivize employers to prioritize child care as a workplace benefit. By providing a tax credit for employer contributions, the legislation aims to alleviate the financial burdens faced by working families in securing proper child care, potentially enhancing employee retention and satisfaction. However, it also allocates up to $25 million per state fiscal biennium for these credits, indicating a substantial budgetary commitment from the state to support the initiative.

Summary

SB2164 proposes the establishment of an Employer Child-Care Contribution Partnership Program aimed at reinforcing child care accessibility for employees in Texas. The bill allows eligible taxable entities to make contributions towards their employees' child-care costs and offers a corresponding state match for these employer contributions. It mandates that participating employers contribute at least $1,200 per eligible employee annually towards child-care costs. This program is designed to enhance workforce stability and assist families in affording high-quality child care while fostering early childhood development in the state.

Contention

While the bill is poised to address critical concerns regarding child care affordability, certain points of contention may arise around the implementation of the program. Stakeholders may debate the eligibility criteria and distribution of state match funds, as well as the overall efficacy of the program in genuinely improving access to child care services. Furthermore, ensuring that contributions are made equitably across employer sizes—particularly prioritizing small businesses—can also be a focal point of discussions as this may influence local economies and workforce dynamics.

Texas Constitutional Statutes Affected

Tax Code

• Chapter 171. Franchise Tax
  • Section: New Section