Committee debates limiting private equity access to early childhood endowment; concern home daycares could be sidelined
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Summary
Lawmakers debated SB 266 (LCO 2432), which would restrict endowment funding to private equity entities. Supporters said the change would prioritize small, community providers and child‑care deserts; opponents warned the bill's wording could push home daycares to the back of the funding queue. The motion was moved to further action; votes were held open pending the public hearing.
The Children's Committee debated SB 266, LCO 2432, a bill that would limit access by "private equity entities" to funds from the Early Childhood Education Endowment. Proponents said the aim is to prioritize community‑rooted and small child‑care providers and to direct funds into child‑care deserts where institutional investors typically do not operate.
"The whole idea here behind this bill is to fund small businesses, to fund small providers, to grow child care in deserts, and to grow child care across Connecticut," the chair said while explaining substitute language that clarifies the bill's intent. The chair read substitute language saying, in part, "the commissioner may not expend such funds to any private equity entity until such funds have been expended to all other such early care and education programs and preschool programs."
Senator Perillo said he supports growing child care but pressed that the bill’s current text appears to reach beyond institutional private equity and could unintentionally penalize small home operators who accept investment from a relative or private lender. "This is gonna put home daycares at the back of the line," he said, arguing the statutory definition of "private equity entity" could sweep in individuals raising start‑up capital for home daycares.
Representative Pezzuto and Representative Mastro Francesco also voiced concerns that the definition might be overbroad and that the measure could have unintended consequences for small providers. Pezzuto recounted experience advising on private‑equity issues in other sectors and urged careful drafting; others said testimony previously submitted at the public hearing had been largely in favor but lacked hard data demonstrating harm from private‑equity ownership of child‑care centers.
Committee members agreed to move SB 266 for further consideration (motion to JFS to the floor) so that staff and members can refine the substitute language. The clerk recorded roll‑call votes; the chair noted that votes would be held open until the start of the public hearing and the committee reconvenes for final action.
The committee did not adopt final policy changes during the session; staff and sponsors said they will work to tighten language to avoid disadvantaging bona fide small home operators while preserving the priority for community‑rooted providers.