What will the “child care endowment” do?
Historic investment is moving the needle on affordability
Every dollar invested in child care today will help parents afford care in the future. The child care crisis boils down to two realities: providers are leaving the profession because they can’t make a living wage, and families can’t afford to pay more. That’s why Connecticut’s creation of the Early Childhood Education Endowment is a crucial, historic step towards putting child care within reach of more parents.
Now signed into law, Senate Bill 1 directs some of the state’s annual surplus into the endowment fund. The endowment will only grow as lawmakers invest more in it and the fund gains interest. It’s a way to fund child care subsidies and programs with stability and certainty.
So, when will this all happen? The state plans to release a report every year that will explain more about the endowment’s future and when milestones could happen. There will also be an online portal where parents can learn more about if they qualify and what programs are covered. For now, we know some basics about how the endowment will work, how it will be funded, and when parents could start seeing relief.
The endowment’s impact will happen over a few phases:
Phase One: By July 2026, the state can start releasing endowment funds to early education programs.
Phase Two: Starting in July 2027, at least 35% of new spaces funded by the endowment must be for infants and toddlers.
Phase Three: Starting in July 2028, families making less than $100,000 a year will have access to free child care if the provider they’re using receives money from the endowment. Families making more than $100,000 a year will have the cost of care capped at 7% of their income if their provider receives money from the endowment.
The creation of the endowment is more than a win for families – it’ll also boost salaries for workers. Currently, too many early childhood educators aren’t earning a livable wage. That’s why up to 40% leave the profession each year, which is a loss for them and for the children they teach. It’s already hard for many parents to find care. Losing providers only makes it harder to find an affordable seat.
The state can invest up to $300 million of its massive surplus in the endowment this year. While it’s a historic investment in affordable child care, lawmakers must continue to add to the fund so that parents don’t have to wait years for relief. Every dollar invested now will earn more interest to help future families.
If you’re struggling to pay for child care right now, before the endowment kicks in, help may be available. The state’s existing Care 4 Kids program provides subsidies based on your income and how many children are in your family. However, the program hasn’t previously been funded enough to match the true need.
Our economy doesn’t work without child care. One in five parents have had to quit their job or have been fired because they’ve had problems finding or affording child care, according to a state report.
The creation of the endowment is a thoughtful first step to creating a Connecticut where every parent has the freedom to pursue the best child care option for their family.
