Struggling to afford day care? Some state lawmakers want to cap how much you pay for it.

On Thursday, Democrats pitched a new Workforce Child Care Fund that would limit child care costs to 7% of your household income.

But there’s a catch.

The money would come from a new payroll tax on all Connecticut employers, drawing sharp opposition from business groups – and even some day care centers.

Jenise Ramos, of Middlebury, is struggling to raise two kids. Since she can’t afford day care, she has to stay home instead of working.

“I’m here because families like mine are struggling, and we deserve to be heard,” Ramos said. “I applied for Care4Kids, thinking it would make child care more affordable. But even with assistance, I was still required to pay over $200 a week.”

Advocates said some families spend almost 20% of their salary on day care – if they can even find a slot.

A new bill would cap child care costs at 7% of your income – regardless of how wealthy you are.

To qualify, the child must be under 13 years old and the parent must be employed full-time for six months or part-time for 175 days. They also cannot be receiving other assistance, like SNAP food benefits or Head Start.

The new fund would also offer grants to day care centers to raise workers’ salaries and offer retention incentives, which could address the shortage of slots.

If there's enough money, the fund could be expanded to cover after school programs and summer youth camps next year.

But to pay for it all, employers would see an extra 1.5% payroll tax starting in 2026. Workers already pay a 0.5% payroll deduction to fund Connecticut’s Paid Leave program.

One child care group told lawmakers that the tax could cost it $10,000 a year.

“Ripple effects of this payroll tax could lead to businesses laying off employees, freezing wages or reducing hours,” said Karen Rainville, executive director of Association for the Education of Young Children.

The state’s largest business group warned that the tax could drive businesses away.

“Operating a business in Connecticut is already a significant challenge in comparison to other states,” said Jenna Grasso with the Connecticut Business and Industry Association. “There’s an ongoing trend among existing businesses in the state to explore relocation or even expansion to other Southern states.”

Republican lawmakers also pushed back.

"I come from a family with a small business, and they feel like they're getting hit left and right with taxes and mandates," said state Rep. Anne Dauphinais (R-Killingly).

Gov. Ned Lamont is pitching his own plan for universal preschool.

“Providing pre-K and preschool spaces at no cost for all families earning up to $100,000,” Lamont told lawmakers in his budget address. “Saving parents thousands of dollars and giving them the freedom to get back to work – because parents, our businesses need you.”

Lamont’s plan does not involve a payroll tax, but it does divert $300 million in budget surpluses into a new Universal Preschool Endowment, which would operate outside the state’s strict spending caps, known as “fiscal guardrails.”

In future years, Lamont would loosen the state’s Volatility Cap, which prevents lawmakers from spending “volatile” tax revenues like stock market gains.

Republicans called it a “slush fund.”

“He’s creating gimmicks to get around the spending cap,” said Connecticut Senate Republican Leader Stephen Harding (R-Brookfield). “$3 billion in increased spending, blowing past the guardrails, playing fiscal gimmicks, creating slush funds."

Lamont also expanded eligibility for the state’s Care4Kids program, which offers child care assistance at participating providers across Connecticut. An extra 1,500 children now qualify. The average family will also save an estimated $200 per month on fees, which will now be capped at 7% of their income.

Ramos said she doesn’t care how it’s paid for. She just wants help.

“We’re told to work hard and provide for our kids, but when child care costs are more than we can afford, we can’t do much more,” she said.

It’s not clear whether any of these childcare ideas will actually happen. Ultimately, they will have to make it through tough budget negotiations this year.

You can submit testimony HERE.