State readies fall market-rate survey and cost-of-quality analysis that could change subsidy rates

The Department of Children, Youth, and Families (DCYF) told providers at a July provider-supports subcommittee meeting that it will deploy the 2025 market-rate survey on Oct. 1 and keep it open for three months, with a final report due to the legislature by June 1, 2026.

The survey will collect what child-care providers charge in private markets by region, age group and provider type, and will also update non‑personnel cost data such as rent, mortgage and utilities. The data are the basis for the Working Connections Child Care subsidy base rates that the state pays providers.

Why it matters: the legislature instructed DCYF to run the survey every two years and to use market-rate data in setting base rates, but federal rules allow an alternative method — a “cost of quality care” approach — and the state has federal approval to switch if the legislature authorizes it. DCYF said it will gather data this fall that could support either approach.

On why the survey matters to providers, Matt Judge, DCYF’s federal initiatives and collaboration administrator, said: “The legislature sets subsidy base rates for the Working Connections childcare subsidy program based on market rate data.” He warned that low response rates in regions with few providers can cause volatility in regional rates and urged broad participation, especially from school‑age and rural providers.

DCYF is repeating the cost-of-quality work it pursued in 2024 alongside the market-rate questions. That effort uses a provider-informed model developed with an “early educator design team” to estimate the costs necessary to meet higher quality standards, including a living‑wage assumption drawn from the MIT living‑wage scale, stronger benefits, paid planning time, curriculum and professional development.

Matt Judge said that federal Administration for Children and Families (ACF) rules require states to show geographic, provider-type and age-group variation in their rates and to document provider participation barriers. He said DCYF already has ACF permission to adopt a cost-of-quality methodology if the legislature chooses to do so and that the 2025 study will provide updated options and comparisons for policymakers.

DCYF and Western Washington University, the vendor that assists with the study, plan to deploy the primary online survey in October; the department will use phone follow‑up and a spreadsheet upload option for organizations that operate multiple sites. DCYF said it will also pilot test the survey with a small group of providers in September to identify confusing questions and technical issues that reduced response rates in 2024.

The department listed a compressed timeline because Senate Bill 5752 requires the report by June 1. Key dates announced at the meeting: question development and narrowing in July–August, pre‑communications in September, survey deployment Oct. 1–Dec. 31, report drafting in January and a lengthy internal review March–May ahead of the June 1 deadline.

DCYF asked providers to volunteer for testing and to help spread the word about the survey through newsletters and provider networks. It also said it will work to shorten the survey to raise response rates and will streamline the cost-of-quality content to reflect only the items the early educator design team recommended.

The department expects to publish a report that compares market-rate-based rates with the cost-of-quality model so legislators and others can see the differences and the drivers behind them. DCYF staff asked providers and local organizations for suggestions on outreach, language access and how to make the survey easier to complete.

Provider supports co‑chair Dave Mayer and other participants emphasized outreach through consolidated newsletters and provider networks to increase participation. DCYF said it will take providers’ feedback on question clarity and outreach planning through the “feedback loop” materials it posted to attendees.

Ending: DCYF plans another presentation to provider forums as the survey questions are finalized and will follow up about pilot testing and outreach plans in September.