CRACKDOWN Act of 2026

This bill amends the Child Care and Development Block Grant Act of 1990 to establish an improper payment threshold for states receiving federal child care funds. Under the new provisions, if a state's overpayment rate exceeds 5% of its aggregate payments in a fiscal year, it must submit a corrective action plan to the Secretary for approval, detailing how it will reduce this rate to 5% or less. Should a state's overpayment rate remain above 5% for two consecutive fiscal years, it will face conditional ineligibility for federal funds. To regain eligibility, the state must demonstrate it will reduce the rate to 5% or less in the next fiscal year or show significant progress on its approved corrective action plan.