S.B. No. 2164 establishes the Employer Child-Care Contribution Partnership Program in Texas, designed to encourage employers to assist with their employees' child-care expenses. The program will be managed by a designated commission that will create standardized agreements for employers, employees, and child-care providers. Employers must contribute a minimum of $1,200 annually for each eligible employee's child enrolled in a qualifying child-care program. The bill also details the responsibilities of employees and child-care providers, including eligibility criteria and necessary agreements for participation.

Additionally, the bill introduces a franchise tax credit for taxable entities that contribute to their employees' child-care costs, with a dedicated program fund sourced from appropriated money, interest, civil penalties, and donations. The fund will prioritize at least 25% of appropriated amounts for employers with fewer than 50 full-time employees. The commission will verify eligibility for state matches based on median household income, with matching contributions capped at $25 million per fiscal biennium and individual matches not exceeding $3,600 per child. The bill also amends the Tax Code to allow entities to claim child-care contribution credits, with a fiscal year cap of $25 million and provisions for carrying forward or transferring unused credits. The bill is set to take effect on September 1, 2025, with tax credit provisions starting on January 1, 2026.

Statutes affected:
Introduced: Subtitle B, Title , Labor Code 1.01, Chapter , Tax Code 2.01 (Subtitle B, Title , Labor Code 1, Chapter , Tax Code 2)