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Child-care advocates press lawmakers for larger deposit to endowment, warn July 2027 target at risk
Summary
Advocates and providers urged the Finance, Revenue and Bonding Committee to increase this year's deposit to the Early Childhood Education Endowment from the governor's proposed $129 million to roughly $300 million, saying a smaller deposit will make the statutory goal of holding family fees to no more than 7% and free slots for families under $100,000 unattainable by 2028.
Child-care advocates told the Finance, Revenue & Bonding Committee on Tuesday that Connecticut risks falling short of statutory affordability goals for early childhood care unless the legislature deposits far more into the new Early Childhood Education Endowment this year.
"To make good on the promises made last session, the endowment must contain a minimum of $1 billion by July 1, 2028," said Courtney Parkerson of Childcare for Connecticut. Advocates and analysts said that to remain on track the state needs a $300 million deposit this year rather than the $129 million proposed in the governor's budget.
Advocates described the endowment as a long-term tool that relies on compound returns: the larger the corpus today, the more the fund will generate ongoing distributions to keep parent fees low and to support provider rates.
Sky Cornell, a researcher working with social-impact partners, presented modeling showing the scale of the gap: under the statutory distribution rates the system now serves roughly 18,420 early-start slots; closing the gap on lost parent fees and Care4Kids revenue for those enrolled programs will require roughly $100—.8 million in FY28 alone if the endowment is not substantially seeded now.
Advocates said the choice is stark. Without a larger initial deposit, the state will either fund far fewer subsidized slots or fund existing slots at reduced rates that could starve programs operating on narrow margins. "Any time lost is money lost," said Ava (Childcare for CT). "If we do nothing, the promise to support families most in need will be blown out of the water."
Provider representatives said programs are already fragile: directors described workforce shortages, low wages, and the operational reality that many centers operate at very low margins and would struggle if parent-fee revenue or Care4Kids payments were curtailed. They warned that supply shocks can lead centers to close or reduce capacity, which happened at one center in Manchester earlier in the week.
Lawmakers asked analysts detailed funding questions about the modeling, including how the $1 billion target translates into distributions and how much would be needed this year to hit statutory affordability benchmarks.
What's next: Advocates urged the committee to revise the governor's deposit and to adopt safeguards so a July 2027 affordability commitment is backed by sufficient capital. The committee did not vote on an immediate change but told witnesses it would study the fiscal options and distribution mechanics.
Source quotes were drawn from testimony at the Finance, Revenue & Bonding Committee hearing on May 12, 2026.
