DCYF preview: 2025 market‑rate and cost‑of‑quality survey to inform subsidy rates; deployment set for Oct.–Dec. 2025

Matt Judge, federal initiatives and collaboration administrator for DCYF, told ELAC on Aug. 5 that the department is preparing a combined market‑rate and cost‑of‑quality survey to inform Working Connections child‑care subsidy base rates and to create a dataset for future policy choices.

“We are going to set subsidy base rates based on the data that we collect in this survey,” Judge said, explaining that the legislature requires market‑based rates while the state has federal permission to move toward a cost‑of‑quality methodology.

Why it matters: The market‑rate survey determines the base subsidy rates paid to providers by region, provider type and child age. DCYF said the 2025 survey will also collect the cost inputs needed to calculate a cost‑of‑quality rate should Washington choose to adopt that alternative methodology later.

Federal and state framework - Federal rules (Child Care and Development Fund) require states that use a market rate to reflect geographic variation, provider category (center vs. family home) and child age, and to report on subsidy participation barriers. - Senate Bill 5752 (2025) requires Washington to do the market‑rate survey every other year and set an interim legislative reporting deadline of June 1, 2026 for the next survey.

Survey priorities and approach - Dual methodology: DCYF plans a survey that captures both private rates (market rate) and the elements needed for a cost‑of‑quality calculation: personnel costs, benefits, overhead (rent/mortgage/utilities), curriculum and time for planning and professional development. - Early educator design team: DCYF convened providers to recommend cost‑of‑quality assumptions; the team recommended robust compensation assumptions including living‑wage benchmarks (e.g., MIT Living Wage) and benefits. - Provider participation: DCYF seeks higher response rates than the 2024 survey. Staff said 2024 participation was about 25% overall (lower than historical averages of roughly 40–50%) and that low participation can produce erratic rates in low‑population regions. The department plans outreach, multiple reminders, postcards, phone follow‑ups and an incentive (the 2024 incentive was $100; funding for 2025’s incentive is under consideration).

Timing and process - Deployment: DCYF plans to deploy the survey Oct. 1, 2025, and to keep it open through December to avoid holiday interference; the final report is slated for submission to the legislature by June 1, 2026 as required by statute. - Survey development and testing: The survey has been revised and will undergo provider testing and vendor implementation; DCYF will provide a spreadsheet option for multi‑site providers to ease participation.

Questions raised ELAC members asked about federal compliance, how the survey supports an eventual move to cost‑of‑quality, participation incentives, and efforts to improve response rates for school‑age and rural providers. Judge said the legislature sets whether and when to apply survey results to subsidy rates but that DCYF must meet federal and statutory requirements for survey design and frequency.

Ending: DCYF encouraged providers to participate and to test draft materials; staff said they will circulate links, office hours and a timeline for participation.