A Senate Democratic investigation released on Friday, November 13, 2026 found that two of the nation’s largest private equity-backed child care chains drew more complaints and more serious safety violations than other providers in three states.
U.S. Senator Jeffrey Alan Merkley (D-Ore.), the top Democrat on the Senate Budget Committee, reportedly released the report, titled “Who Profits from Child Care?”
It focused on KinderCare Learning Companies and Learning Care Group. Together, the two companies can enroll more than 375,000 children.
What the Data Showed?
Democratic staff analyzed licensing and violation records in California, Texas and Virginia. KinderCare and Learning Care Group centers were cited more often, more seriously and more repeatedly than for-profit chains without private equity backing, as well as all other centers.
The two companies drew inspections triggered by complaints at about twice the rate of chains without private equity backing and up to four times the rate of all other centers. They also accumulated high-risk violations at up to three times the rate of those chains.
How Much Money KinderCare Collected?
About one-third of each company’s revenue comes from public funding programs, including subsidies. KinderCare collected roughly $1 billion in subsidy-supported tuition in fiscal year 2025.
The report also examined how the companies’ owners have been paid. KinderCare and Learning Care Group reportedly borrowed more than $1.25 billion to pay dividends to their private equity owners, Partners Group and American Securities. That left the companies with substantial debt.
How the Amount Was Divided Among Safety, Debt Payments
Merkley opened the inquiry in March, asking the companies and their owners for financial records, ownership details, tuition trends, safety standards and employment practices. All four responded with brief narratives and no underlying records, per his office.
That gap, the report said, made it impossible to determine how subsidies and tuition were divided among safety, staffing, debt payments and investor returns.
Merkley said private equity firms were taking over industries families depend on. He reportedly urged Congress to act against what he called predatory practices in child care.
What Were the Limitations Of the Findings?
The analysis reportedly only covered three states and was produced by Democratic staff, not an independent body. It showed that violations and complaints were more frequent at the chains, but it did not establish that private equity ownership caused them.
The question of private equity’s role in the industry was also contested. A separate working paper, “Big Daycare: The Growth of Private Equity in the U.S. Child Care Market,” by researchers at the University of South Carolina and Arizona State University, reportedly found no evidence that private equity is the primary reason child care is unaffordable.
It found that private equity-backed providers tend to cluster in counties with tight child care markets and in states with looser staffing rules.
