Gov. Kay Ivey signed the “Working for Alabama” legislative package, which includes HB358, the child care tax credit bill that legislators say will help increase the state’s low labor force participation rate.

In 2022, almost 85,000 Alabama families needed access to child care but had no affordable, quality options in their communities, according to the Women’s Foundation of Alabama. As many as 19% of working parents in Alabama said they had had to miss work due to child care issues, the U.S. Bureau of Labor Statistics found in 2021.

“When we address the barriers that women and families face, we are making Alabama better, Alabama stronger. Pro business is being pro family,” Melanie Bridgeforth, CEO of the Women’s Foundation of Alabama, said.

The child care tax credit bill caps the state’s initial investment in the tax credits at $15 million in 2025, plus $5 million for facilities that improve their quality, according to its fiscal note.

The Women’s Foundation estimates the state’s total investment will add to $82.5 million, if the legislation is fully phased in.

“The work will not stop with the passage of this bill. We have to continue to fight to ensure that as many childcare providers, as many employers as possible, utilize the tax credits.” Brigdeforth said.

The bipartisan multi-bill package includes:

• Alabama Workforce Transformation Act
• Alabama Growth Alliance Act
• Alabama Career Pathways Act
• Housing Tax Credit
• Child Care Tax Credit

“Childcare is just as important as a road or bridge to get to work. And we’re going to invest in our families. We’re going to invest in our working moms and our working dads to be sure that they have what they need to be good employees.”