The Amarillo Area Foundation (AAF) is calling on the Amarillo City Council to adopt an ad valorem tax exemption for childcare facilities, a move they say would strengthen the local workforce and economy.
During a recent city council meeting, Keralee Clay, Interim President and CEO of AAF, emphasized the critical role childcare plays in workforce participation.
“Childcare is the backbone of our local workforce,” Clay stated. “Without it, families aren’t able to fully engage in the workforce.”
State Legislation Opens the Door for Local Action
Last November, Texas legislators passed a property tax exemption for childcare centers, but individual cities and counties must opt in to enact the policy at the local level.
“We went before the Amarillo City Council to ask them to adopt this exemption,” Clay explained. “This would allow childcare centers to be exempt from property taxes on their facilities, helping them stay financially stable and keep costs down for families.”
Minimal Burden on City Officials
Clay reassured council members that adopting the exemption would not create additional work for city administrators. Instead, applications would be processed through the Tax Assessment Office, which would determine eligibility based on state-set criteria.
“There’s a simple application process,” Clay noted. “If a childcare center meets the qualifications, the tax assessor’s office takes care of the exemption.”
Eligibility Criteria Encourage High-Quality Childcare
To qualify for the exemption, childcare facilities must meet Texas Rising Star quality rating standards and allocate a certain number of slots for subsidized childcare, ensuring affordability for lower-income families.
Clay believes the exemption could incentivize more childcare centers to meet these high standards, ultimately improving both quality and affordability.
Economic Benefits Outweigh the Costs
AAF estimates that the total tax credits granted would be less than $30,000, a small investment compared to the long-term economic benefits.
“Childcare facilities operate on thin margins,” Clay explained. “Outside of paying staff, property costs are one of their biggest expenses. This exemption would prevent those costs from being passed down to families, which could force some parents out of the workforce.”
A Thriving Childcare System Strengthens Amarillo’s Economy
Clay warned that childcare challenges could impact Amarillo’s ability to attract and retain businesses.
“This is an impending crisis for the Texas economy,” she stressed. “Without strong childcare infrastructure, businesses will struggle to hire employees, and families won’t be able to fully participate in the workforce.”
She added that investing in early childhood education is not just about supporting families but also about preparing children for school and long-term success.
“Ninety percent of a child’s brain development happens between birth and age five,” Clay explained. “If we don’t provide quality childcare, many kids will already be behind before they even start kindergarten.”
What’s Next?
The Amarillo City Council has yet to vote on the proposed exemption, but with strong support from local childcare advocates and business leaders, AAF hopes to see action soon.
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