States are addressing childcare costs with affordable programs.

As the curtain closes on the $52.5 billion childcare relief initiative led by the Biden administration and Congress, a variety of innovative solutions at the state level have emerged to fill the void. Policymakers across the country have recognized that a federal solution may not be feasible in the near future, prompting them to proactively develop new approaches to fund and sustain childcare programs. These initiatives include the expansion of low-cost or free preschool and early childhood education, as well as the implementation of permanent funding mechanisms to ensure their longevity.

One particularly groundbreaking example is New Mexico, where petroleum revenue is being used to make child care universally accessible for almost all families in the state. Since this change was made in 2022, early childhood initiatives have received a significant financial boost from leasing state lands to oil and gas companies, resulting in an estimated annual influx of $150 million. Meanwhile, in Washington state, a novel 7% tax on residents' investment profits is being used to support ambitious child care goals, such as offering free preschool for low-income families, childcare vouchers for households with low to moderate income, and high-quality infant care for children with developmental concerns by the end of the decade. However, there is a potential threat to this progress, as a referendum in November could repeal the tax and create uncertainty for childcare advocates.

Kentucky has also taken action by offering to cover or reduce the cost of daycare for parents employed in early care and education. Launched in 2023, this program aims to address two challenges simultaneously: alleviating the worker shortage in the industry and providing more affordable childcare options for families. Its success has not gone unnoticed, with the Center for the Study of Child Care Employment reporting that other states have shown interest in implementing a similar model. In fact, the CSCCE estimated that around 234,300 workers with children under age six could benefit from the Kentucky program if all 50 states, including Washington D.C., followed suit.

While the majority of investments in these initiatives have come from Democratic lawmakers, there has also been support from Republican state legislators. This shows a bipartisan effort to address the pressing issue of childcare and highlights the importance of finding solutions that benefit families and the economy as a whole. As we continue to navigate the challenges of the childcare crisis, it is crucial to consider and support the various innovative approaches being taken at the state level.

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