Federal Funding Freeze [Updated: March 18, 2026]

On January 6, 2026, the Administration for Children and Families (ACF) at the U.S. Department of Health and Human Services issued a letter to Governor Gavin Newsom regarding a temporary restriction to California drawing down funds from the federal Child Care and Development Fund (CCDF).

What we know:

  • On January 5, 2026 - The ACF received a bulletin from the Office of Child Care activating “CCDF Defend the Spend (DTS), you can read the bulletin by clicking here.
  • On January 6, 2026 - The Trump Administration ordered a formal freeze on TANF, CCDF, and SSBG programs in 5 states, including California.
  • On January 9, 2026 - A federal judge temporarily blocked the funding freeze after the 5 states, including California, filed a federal lawsuit.
  • On February 6, 2026 - The federal judge issued a Preliminary Injunction requiring the continuation of funding for the three programs for the duration of the case. While the order does not include a timeline, there are no further hearings scheduled at this time. [Source: Politico Article]
    • This decision ensures that $10 Billion in Child Care and other Social Service program funding continues to flow to states, uninterrupted.
  • March 11, 2026 - Civil rights groups filed a request under the Freedom of Information Act (FOIA) seeking transparency from the U.S. Department of Health and Human Services (HHS) and its sub-agencies.
    • "The FOIA request seeks records concerning the adoption, implementation, and enforcement of the nationwide “Defend the Spend” policy and the sweeping five-state funding freeze targeting Child Care and Development Fund (CCDF), Temporary Assistance for Needy Families (TANF), and Social Services Block Grant (SSBG) dollars." ACLU Press Release

FY2026 Appropriations

On Wednesday, November 12, President Trump signed a partial federal funding bill, ending a record 43-day shutdown after stalemate negotiations between House Republicans and Senate Democrats over extending the Affordable Care Act (ACA) Enhanced Tax Credits and the inclusion of guardrails against unlawful withholding of federal funding. In early February, Congress passed and President Trump signed another partial funding package which included full-year funding for Labor, Health and Human Services, Education, and Related Agencies (Labor-H). This FY26 spending bill included:

  • $85M increase for the Child Care and Development Block Grant (CCDBG) program, for a total of $8.831 billion.
  • $85M increase for Early Head Start-Head Start, for a total of $12.357 billion.
  • Level funding for Preschool Development Grants Birth through Five (PDG B-5) for a total of $315 million.

As of March 18, 2026, we continue to operate under a "partial funding freeze" due to ongoing negotiations over funding the Department of Homeland Security. House Democrats are holding strong on stopping increased funding for Customs Border Patrol, Immigrations and Customs Enforcement, and the Secretary's office.

The Shutdown Will Have A Ripple Effect Putting Children and Families at Risk of Further Instability

SAN FRANCISCO, CA (October 8, 2025), On Tuesday, September 30 Congress failed to agree on a budget package that would fund the federal government through late October or early November. As a result, the federal government is now shut down until policymakers can find middle ground. The impacts of this shutdown are significant and widespread.

  • Thousands of federal employees have been furloughed, national parks are closed, and airports across the country face mass staff shortages.

  • Child care subsidy programs, Head Start, and WIC programs may not see immediate impacts because they were able to receive their contracts and funds prior to October 1 for this coming year.

  • However, new Medicaid and Social Security applicants and renewing CalFresh vendors who support their local communities may experience administrative delays.

For California’s children, families, and providers, many of whom rely on federal assistance programs to keep their doors open or put food on their tables, the future becomes more uncertain the longer a shutdown lasts. While our federal policymakers remain at a standstill, Americans across the country are facing the brunt of the consequences.

Working families in California already struggle with HIGH costs of living and low wages. Many must choose between paying rent or putting food on the table. Further cutting access to affordable health care, child care, nutrition, and housing will have a domino effect that puts thousands of families at risk of poverty, homelessness, and economic insecurity.

We cannot continue to use the health and wellbeing of children and families as political pressure points. We need our social service programs to work in tandem. We need deeper state investments and protection from federal cuts and we need our policymakers to take a stand with us to prioritize people over politics or profit. The Network asks others to join us in calling on our Congressional representatives' to prioritize families and children above adding to the pockets of billionaires!


Linda Asato
Executive Director
California Child Care Resource & Referral Network (Network)
lasato@rrnetwork.org
415-494-4640 Direct Line
415-882-0234 Main Line

H.R. 1 Reconciliation

On July 4, the President signed the "One Big Beautiful Bill Act" (OBBBA) or H.R.1 into law, making massive, widespread changes to our country's spending. Earlier in the spring, the House and Senate agreed on a budget blueprint which required committees to find a total of at least $4 billion in 'savings' over the next decade, resulting in massive cuts to critical social programs like Medicaid and SNAP. Over the next three months the House and Senate ping ponged the bill between houses, reaching a final agreement on July 3. While a number of provision were excluded in the Senate version due to the Byrd Rule, the final package still included over $1 trillion in cuts to health care and $186 billion in SNAP cuts through 2034. In California alone the Big Beautiful Bill will...

  • Take away health care from 13.6 million Californians, including 3.5 million children. [CBPP]
  • Take food off the table for 11.4% of California households facing food insecurity. [CBPP]
  • Push 57,000 Californian families, seniors, and children back into hunger and poverty each year with devastating cuts to SNAP. [CBPP]
  • Force the State of California to find an additional $15.5 billion in its own budget to make up for lost federal funding. [CBPP]

More resources on the OBBBA:

  • What is Reconciliation? Reconciliation 101 [Committee for a Responsible Federal Budget]
  • When Will the OBBBA Provisions Take Effect? Check out this detailed timeline [The Center on Budget & Policy Priorities]
  • What's in the OBBBA? Summary of OBBBA provisions [Holland & Knight Analysis]
  • How Budget Cuts Could Impact Californians [California Budget & Policy Center]
    • Medicaid is a critical support for the Early Childhood Education Workforce [Georgetown University McCourt School of Public Policy]
    • How Medicaid and SNAP Cutbacks in the “One Big Beautiful Bill” Would Trigger Big and Bigger Job Losses Across States [Commonwealth Fund]
    • Senate Follows House Lead on SNAP Cuts Proposal: A Direct Threat to Families, Communities, and the Economy [FRAC]

What is the difference between appropriations and reconciliation?

  • Appropriations: An annual appropriations process that determines federal discretionary spending. This process requires negotiation between the House and Senate. Learn more here.
  • Reconciliation: A special legislative process created as a result of the 1974 Congressional Budget and Impoundment Control Act that allows for expedited consideration of tax, spending, and debt limit legislation. Thus, a reconciliation bill can avoid the Senate's 60-vote filibuster threshold and instead allows lawmakers to pass legislation with a simple majority. Learn more here.

JULY 8, SAN FRANCISCO - On July 4, 2025 President Trump signed into Law the “One Big Beautiful Bill Act.” Together, Congress and the President made an agreement that cuts over $1 trillion dollars from our health care system and $297 billion in food assistance to offset massive increases in defense spending for mass deportations and detention centers and to pay for tax cuts for the ultra wealthy and corporations.

We are deeply concerned and profoundly disturbed by the cuts in the so-called One Big Beautiful Reconciliation Bill! Let’s be clear… the American people did not ask for this. We hold accountable our California House Representatives who voted for legislation while acknowledging that it will devastate their communities for years to come. That is not sensible leadership and rather cruel abuse of decision making power and public resources.

In California alone…..

  • The Big Beautiful Bill will take away health care from 13.6 million Californians, including 3.5 million children. [CBPP]

  • The Big Beautiful Bill will take food off the table for 11.4% of California households facing food insecurity. [CBPP]

  • The Big Beautiful Bill’s cuts to SNAP will push 57,000 Californian families, seniors, and children back into hunger and poverty each year. [CBPP]

  • The Big Beautiful Bill will force the State of California to find an additional $15.5 billion in its own budget to make up for lost federal funding. [CBPP]

The Bill’s passage will be felt across socio-economic divides, but the heaviest burden will be felt by working Americans who are already struggling to afford basic necessities, especially those already burdened by poverty, systemic racism, and the fallout of past disinvestment. The tactical implementation - e.g. staggering cuts both after the 2026 election or after 2028, and the expiration of taxes on tips and overtime pay after December 2028 - are all timed to hide the deliberate impact of hurt on working people and preserve the power to the richest and most compliant lawmakers.

Despite its title, this bill is not beautiful. It undermines the health, safety, and economic stability of families and opposes the values of a country that claims to care about children and working people. These are not just line items, These are LIFELINES!

For over 40 years resource and referral agencies have stood as pillars within their community, serving as trusted support systems for local families, children, and child care providers. Every year they connect thousands of people with free services, one-on-one assistance, child care referrals, and professional development training. More than anyone, they know that helping people requires compassion, understanding, and support, not deeper cuts and more red tape.

The Big Beautiful Bill sets us back decades of hard-fought progress but together with our members and partners, we will continue working toward our shared vision of an equitable future while rejecting antiquated policies that only perpetuate our existing systems of oppression and exclusion.


Linda Asato
Executive Director
California Child Care Resource & Referral Network (Network)
lasato@rrnetwork.org
415-494-4640 Direct Line
415-882-0234 Main Line

Linda Asato, Executive Director of the California Child Care Resource & Referral Network (Network)