Ayotte signs three childcare bills into law, including business tax credit

New Hampshire Gov. Kelly Ayotte has signed three bills related to early care and education into law, including a new business tax credit. 

After months of legislative procedure and weeks of waiting for the bill to hit her desk, Ayotte on Thursday signed House Bill 1433, which gives businesses a tax credit for increasing the state’s childcare capacity. Ayotte endorsed the bill in her annual State of the State address in February and applauded legislators when the bill completed its last legislative step. 

HB 1433 establishes the Child Care Day Care Creation tax credit, which allows businesses to claim up to a 50% credit on allowable expenditures against the business enterprise or business profits taxes if they create or fund the creation of at least 12 new childcare slots. The Department of Revenue Administration will administer the program. 

The bill took effect on July 1, although the program does not start until Jan. 1, 2027. Businesses can apply for taxable periods ending on or after Dec. 31, 2027. 

Ayotte also signed Senate Bill 614, which establishes a multi-caregiver, self-insured risk coverage arrangement program for nonprofit and for-profit childcare, foster care, and behavioral health service providers. 

Fewer insurance companies are offering liability insurance to care businesses, deeming them high risk. As a result, those who do offer plans do so at a high price, often one that most businesses cannot afford. The program, overseen by the Department of Insurance, will allow care provider businesses to form groups to pay for and provide insurance coverage for themselves rather than enrolling in a plan through an insurance agency. 

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The bill takes effect July 1, 2027, which is the beginning of the state’s next budget cycle.

The governor also signed House Bill 1195 into law, which changes zoning laws for family childcare providers and simplifies the process for opening a small childcare center. 

Family childcare, also known as home-based childcare, is provided in people’s homes and accounts for about 15% of licensed childcare in New Hampshire. Home-based childcare often provides rural families with access to care, but can be limited by zoning laws that conflict with state childcare licensing requirements. HB 1195 streamlines statutory language to make the process easier for prospective providers to open. 

The bill also requires municipalities to allow the operation of a small childcare center, a center with fewer than 30 children, by right on commercially zoned land. Local laws were also previously at odds with state licensing requirements. 

The bill goes into effect on July 1.