LANSING, Mich. (May 15, 2025) — As the cost of everything from groceries and gas to health care and housing continues to rise under the Trump administration and its chaotic policies, the cost of raising a child is no exception. To provide much-needed financial relief to working families struggling to get by, Michigan Senate Democrats officially introduced a bold, transformative package today. Composed of Senate Bills 308–313, this plan would provide the “Building Blocks” Michigan needs to make raising kids more affordable for families in every corner of the state.
The package takes a multi-angled approach to cutting the cost of parenting by:
- Providing a significant income boost to working families through a targeted Working Parents Tax Cut;
- Expanding Rx Kids statewide, a first-of-its-kind program that provides cash payments to new mothers and their babies; and
- Tackling the child care crisis from both the demand and supply side.
In the first year alone, raising a new baby costs more than $20,000, a staggering amount that is more than a third of an average U.S. family’s annual household income. And now the Trump administration’s tariffs threaten to further exacerbate these costs by hiking up the price of parenting essentials such as strollers, car seats, diapers, and bottles — the majority of which are manufactured in Asia.
To address the issue head-on and help families keep up with the high cost of raising a child, Sen. Kevin Hertel (D-St. Clair Shores) introduced Senate Bill 308. This legislation would provide a tax credit of $5,500 for working families with children through the age of three.
“Raising children is challenging to begin with, and now increased taxes in the form of tariffs and economic uncertainty are making it more expensive for families across Michigan,” said Sen. Hertel. “As a father of two, I see firsthand how rising costs of everyday essentials are adding up quicker than ever and forcing families to make difficult decisions. This tax credit would give parents some much-needed breathing room, so they can keep more of what they earn and focus on giving their kids the healthy, happy lives they deserve.”
The Working Parent Tax Cut would be simple to apply and qualify for, extending eligibility to young families with incomes at or below 150% of the state’s median, as defined by LIHEAP.
Improving Families’ Physical and Economic Health
Rx Kids is a first-of-its-kind program here in the United States, initially launched in Flint, Michigan, in 2024, before expanding to seven other communities across the state in early 2025.
The program supports parents and babies by providing all pregnant moms in a community, regardless of income, with a no-strings-attached cash allowance of $1,500 during pregnancy and $500 each month throughout the baby’s first year. Research from Rx Kids and similar initiatives shows that universal child cash transfer programs help increase housing security, bolster access to nutritious food, and improve maternal and child health. Growing on the work Sen. Cherry championed in Flint, Senate Bill 309 would expand the opportunity for additional communities to participate in the program.
“We’ve seen the positive impact of Rx Kids in Flint, and we’ve heard from parents across Michigan who want the same opportunity in their own communities,” said Sen. Sylvia Santana (D-Detroit). “This program gives babies a strong start in life and empowers parents with the resources they need to provide the love and nourishment every child deserves. Expanding Rx Kids means more families across Michigan can thrive — because every baby, in every community, deserves a healthy start and a hopeful future.”
For a community to participate, they must raise two years of matching funds and contract with a third party for administration of the program. Administration costs are also required to not exceed five percent.
Tackling the Child Care Crisis
In the last decade, Michigan has lost 40% of its child care capacity — a level twice that of the national average — contributing to the state’s 39th-place ranking for workforce participation. This shortage of child care is cited as the top reason young workers are opting out of the workforce, which is costing the state an estimated $2.8 billion annually in lost productivity and economic growth.
“It takes a village to raise a child, but too many Michigan parents have been left to do it alone — and we’re all feeling the impact. Without a robust child care system that works for parents and providers alike, our economy will lag, and our children will be robbed of the strong start they deserve,” said Sen. Anthony. “This plan will cut red tape for providers and bring us one step closer to an integrated, sustainable child care system that’s accessible for everyone.”
“From child care to the grocery store, rising costs are making it increasingly challenging for families to make ends meet,” said Sen. McMorrow. “As a mom of a young daughter myself, I understand the stress parents feel in trying to balance work and caring for your little ones all while desperately searching for any time to take care of yourself. This is why our new Building Blocks package is so crucial. By reforming our systems to make it easier to start and raise a family need, we can help families worry less so they can focus on what matters most: spending time with their little ones.”
To tackle this crisis, Senate Bills 310-313 would make child care more affordable for families and more sustainable for child care professionals and entrepreneurs by:
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Codifying the innovative bipartisan program, Tri-Share, that splits the cost of child care equally among employers, the state, and employees;
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Tying the Child Care Reimbursement Rate to inflation to provide certainty and consistency to providers; and
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Updating licensing requirements for child care centers and removing burdensome barriers to opening and operating centers.
“When parents can access and afford things like child care and health care, we can set our next generation on a solid path towards making a good life for themselves here in our state,” said Sen. Sean McCann (D-Kalamazoo). “The evidence is clear — when families have these basic supports, kids do better in school, are more likely to pursue higher education, and have higher lifetime earnings. If we’re serious about supporting families, these policies are a no-brainer.”
“Our Building Blocks legislation provides a long-overdue solution to the child care crisis facing our state and Michigan parents — a crisis that continues to grow as costs rise,” said Sen. Rosemary Bayer (D-West Bloomfield). “Our plan would tackle this issue head-on, allowing more Michigan families to advance in their career or education with the confidence that their little ones are safe and sound. I’m incredibly proud to take part in this package, which would be truly transformative for Michigan families, providers, and overall economy.”
Following their introduction, these bills were referred to the Senate Housing and Human Services Committee for their consideration. For more information about the Building Blocks package and the work Michigan Senate Democrats are doing to lower costs for Michiganders, visit SenateDems.com/Building-Blocks.