State briefing: Act 76 investments lifted family childcare reimbursements and slowed losses; infant care gap remains
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Summary
Officials told the Education Committee that Vermont's Act 76 investments and higher reimbursement rates helped stabilize family child care and expand capacity, though infant care remains the largest unmet need; First Children's Finance and DCF cited grants, loans and business supports.
State officials and nonprofit partners briefed the Education Committee on Jan. 28 about family child care and rural child care capacity in Vermont, describing both long-term declines in family child care homes and recent stabilization tied to Act 76 investments.
Janet McLaughlin, deputy commissioner with the Department for Children and Families' Child Development Division, told the committee Vermont has slightly more than 1,000 regulated childcare programs: roughly 509 center-based programs, about 401 registered or licensed family childcare programs and about 150 regulated after-school programs. She said the state's regulated capacity is roughly 33,000 slots across program types.
McLaughlin explained two licensing tiers for family childcare homes: registered family childcare homes (smaller, up to six children under 5 plus school-age slots) and licensed family childcare homes (larger, up to 12 under-5 children depending on staffing). Minimum qualifications, safety and facility standards, pre-licensure and annual inspections were described as part of state oversight.
On trends, McLaughlin and other speakers said Vermont mirrored national declines in family child care over the past two decades, with a sharp drop around 2016–17 after regulatory changes; however, they said the decline has recently leveled and some increases occurred after Act 76 investments. McLaughlin described the July 2023 increase in CCFAP infant subsidy from about $225/week to $407/week as "game changing," and said about 5,000 more families now receive childcare financial assistance. She noted that not every family is eligible for the assistance (eligibility requires a service need and income limits).
Erin Roche, Vermont director of First Children's Finance, said the nonprofit makes business-training, consulting and capital available to childcare entrepreneurs at no charge (through a state grant), and administers infant/toddler capacity grants. She said First Children's Finance made 28 grants to family childcare homes and 46 grants to centers in 2025 and that her organization's analysis found a modest recent rebound in family childcare: a Child Trends analysis in August 2025 showed a 3% increase in family childcare since Act 76. Roche also cited a supply-demand gap analysis indicating the statewide gap shrank by roughly 2,000 spaces compared with 2024, while noting that infant-care availability lags other age groups in every county.
Committee members asked about how Act 76 funds were used, differences between family and center models, housing and zoning constraints for home-based providers (including homeowners associations), and workforce and training barriers. McLaughlin and Roche said supports include higher reimbursement rates, start-up and expansion grants, scholarships and loan-repayment programs, coaching and peer networks. McLaughlin and Roche also highlighted demographic and housing pressures that limit potential new family childcare entrepreneurs.
No vote or formal action followed the briefing; committee members noted related work is proceeding in other committees (economic development, health & welfare) and asked for continued data and coordination on rural childcare, zoning barriers and capacity-building programs.
