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Chelsea Chase’s house sits on a rural road in Vermont, four miles from interstate 91. A row of cubbies filled with children’s snow boots and coats near the door, under a carport. In the background, Mt. Ascutney lies in full view from the five-acre lot that Chase and her husband bought this past September with the goal of expanding her family child care program and building a home for their family, including three kids ages 16, 11 and 7.

Downstairs, six children are snacking on pretzels and apple slices. Chase explains that they spend a lot of time outside, adding that her curriculum is nature-based and the woods and backyard pond make it ideal for the kids to explore.

Chelsea Chase’s family child care program at her home in Perkinsville, Vermont. (Rebecca Gale)

For Chase, working in early childhood education is her “life’s passion for sure.” She worked as an early childhood educator for 10 years before deciding to open her own program in 2015. Chase recalls that she was working 50 to 60 hours a week when she first started, which drained her, so in 2016 she hired a staff member to help.

Her program, which serves six children ages 3 to 5 has been successful over the years. Because the demand for child care is so high in the state, she always has a waiting list, rarely has vacancies and doesn’t have to advertise. That’s why in 2024, she decided to expand her business from a registered family child care program with one classroom to a licensed facility with two. This shift would allow her to serve 12 children full time — double the number she can serve as a registered family child care provider. The process, which she kicked off this January, will take well over a year.

Chase explains her plans for the expansion. She’ll add a new room on the first floor, which will serve as a second classroom for infants and toddlers and the cubbies will move indoors. And to transition from a “registered” child care provider to a “licensed” one, she’s required to meet a number of complicated compliance regulations. She has to upgrade her septic wastewater system which will cost $55,000; deepen her well for more water storage capacity, which will cost $14,000; spend another $112,000 to expand the space; and pay an additional $6,500 to fence in the playground.

Chase is adamant that this investment only makes financial sense because of Act 76, Vermont’s landmark bill to bring near-universal child care to the state. The bill, which passed in 2023, aimed to increase access to high-quality child care and stabilize the early care and education workforce, including supporting family child care programs. Act 76 brought changes to various areas of child care and early childhood education, including significant updates to the Child Care Financial Assistance Program, which provides subsidy payments to providers for children from eligible families. Under CCFAP, subsidy payments vary by income and the number of children that families have in child care, but providers now get a higher rate per child than what they typically charge. Since most of the families Chase serves qualify for CCFAP, this change nearly doubles the amount of money she brings in each week for each child.

There are more than 1,000 regulated child care providers in Vermont — including family child care and center-based care providers — who could be impacted by the changes to CCFAP. One of them, Sherry Boudro, has been caring for children in the basement of her home in Windsor, Vermont for more than 30 years. Her house lends itself well to running a family child care program. It has a separate entrance to the children’s space, though it’s still connected to her main house by an internal staircase. Two fluorescent sensory swings hang from the ceiling, and the room is brightly painted and lined with bookshelves.

“Before Act 76 I was living paycheck to paycheck,” explains Boudro. Now, she has more than doubled her income. Boudro was charging families $150 per child per week; now she receives $364 per child per week — a portion of which is paid for by the state depending on each family’s financial assistance agreement. Windsor “doesn’t have a lot of high-paying jobs,” she explains, so she couldn’t charge families more money, even though she was working all the time and barely breaking even. The extra income she receives now is going toward her retirement. “I’m 60 years old and I have no retirement savings,” she says. She’s also planning to make some long-awaited repairs to the space, replacing carpets and fixing the ceiling tiles, which droop down.

Act 76 Benefits Most — But Not All — Providers

Act 76 is the “opportunity and social change of our lifetime,” says Aly Richards, CEO of Let’s Grow Kids — the advocacy organization which spearheaded the bill’s passage. Richards, who has become the state’s chief champion of the bill and de-facto expert on how to bring a near-universal child care program to a state, outlines the success of Act 76 thus far. In its first year, the legislation created 1,000 new child care slots, nearly 50 new family child care programs, over 40 child care centers and 220 new early educator jobs. And in 2024, for the first time since 2018, more child care programs opened in the state than closed.

While ACT 76 has been a game changer for many child care providers in the state, not all have received the benefits. Tammie Hazlett, for example, runs a family child care in Vermont near the Dartmouth Hitchcock Medical Center. Most of the families she serves work have well-paying jobs at the medical center and do not qualify for subsidies, so she isn’t able to collect the higher true-cost-of-care rates. Another provider, Apryl Blake, serves two children who come from a neighboring town in New Hampshire, so they aren’t eligible, and she hasn’t asked the rest of her families to apply. “I have a problem asking them for their financial information. Not my business,” she explains.

Chase says all but one of the families she serves receives a subsidy, and the one family that doesn’t feels excluded and resentful of the process. The mother is a teacher and the father works in the tech industry. They don’t consider themselves to be well-off and they say the cost of child care is still a major expense.

For some longtime providers like Merry Ann Gilbert and Laura Butler, these changes may be coming too late. Gilbert is 59, and though her practice is winding down, she still takes care of five kids a week at her home in Milton, Vermont. She is looking to retire and spend more time with her four grandchildren but Act 76 is motivating her to stay another year or two to make additional money.

Merry Ann Gilbert in her home in Milton, Vermont on a rare day off from caring for children in her home-based child care program. (Rebecca Gale)

Butler, 66, who has been a family child care provider for 33 years, is also missing out — the families she serves don’t qualify for subsidies because their incomes are too high. Vermont’s support for child care has assisted Butler in other ways though, including helping her pay off the student loans she took on when she got a master’s degree.

With a 6-month-old baby sleeping in her arms, a toddler resting on a nearby couch and another toddler playing in her living room, Butler shares that she is retiring in June and moving to South Carolina with her husband so they can be closer to her family. She says she has given the families in her program notice, encouraging them to seek out other child care options.

Laura Butler with one of the children in her care in Milton, Vermont. Butler has been working as a child care provider for 33 years and will retire in June. (Rebecca Gale)

For years, Butler worked as an advocate in the effort to professionalize the work of child care providers — something that Vermont may be the first state to do. “When I would tell people I watched children, they’d say ‘oh you’re a babysitter,’” she says; her work wasn’t recognized as a profession, but that may soon change. In late 2023 the Vermont Association for the Education of Young Children submitted an application to the state’s Office of Professional Regulation to make “early childhood education” a recognized profession; a recommendation by OPR has been sent to the state Legislature for review in anticipation of introducing legislation, but Butler won’t be working in the field when it comes to fruition.

Butler has no resentment though. She says she is ready for her next chapter and the warmer weather. “The next generation of providers will get the benefit,” she says. “I am satisfied that I worked hard for them.”

The importance of financial literacy is clear. It allows people to make informed decisions related to budgeting, saving, borrowing and investing, ensuring that individuals live within their means, while simultaneously generating wealth. Financial literacy is an essential life skill, yet only fifty-seven percent of Americans are considered financially literate according to a survey from credit rating agency Standard & Poor’s (S&P). In a 2023, Annuity.org and Bankrate report, more than one-third of American adults reported having more credit card debt than emergency savings, 68 percent did not believe that they could cover one month of living expenses if they lost their primary source of income, and 25 percent said they had no trusted source to obtain financial guidance.

States, territories, and their Governors recognize the value of financial literacy in their communities and in their education systems. After California instituted a financial literacy high school graduation requirement, Governor Gavin Newsom expressed that “saving for the future, making investments, and spending wisely are lifelong skills that young adults need to learn before they start their careers, not after.” Similarly, Governor Ron DeSantis stressed that “financial literacy is an important life skill” when signing a similar financial literacy bill, requiring Florida high school students to take a financial literacy course prior to graduating. Making financial resources readily accessible for children and adults will empower individuals, teaching them how to spend, save, borrow, and accumulate wealth, leading to economic security, a stronger, more educated workforce, and financially capable communities.

Governors Promoting Financial Stability

Governors have made several financial savings, investment opportunities, and resources available to their constituents. In Wisconsin, for example, Governor Tony Evers created the Governor’s Council on Financial Literacy and Capability, which helps Wisconsinites build financial capability and identify ways to improve the financial inclusion of all Wisconsin residents. Governor Evers reflected on the importance of this council stating, “by working together, we can help ensure every Wisconsinite has access to affordable and timely financial products and services to manage their daily lives and plan for everything from unexpected emergencies to long-term goals. The Council’s work will help provide individuals and businesses with the tools and resources they need to invest in education and housing, capitalize on business opportunities, save for retirement, and cope with various economic shocks.”

In March of 2024, Washington Governor Jay Inslee signed the Washington Saves bill which establishes an automatic Individual Retirement Account (IRA) system available for Washingtonians without access to employer-based retirement systems. This program will ensure long-term financial health for Washingtonians.

In 2021, Governor Kathy Hochul signed legislation providing retirement plan options for available private-sector employees. Private sector employers who do not provide their employees with a retirement plan automatically enroll their employees in New York State’s Secure Choice Savings Plan, which employees can opt out of at any time. Governor Hochul explained that “part of ensuring that New Yorkers are financially stable is guaranteeing they have a reliable retirement plan. This legislation allows all workers to have a sense of relief and security.”

Beyond saving for retirement, Governors are promoting financial literacy as a means to create financial stability by providing incentives for individuals to obtain the financial knowledge they need to succeed in the workforce and for retirement. In Arizona, for example, students who graduate from a district or charter school and have demonstrated a high level of proficiency in personal finance are eligible to have a State Seal of Personal Finance attached to their diploma.

To effectively teach financial literacy across the education continuum, educators must be equipped with the requisite knowledge. That is why Florida provides opportunities for teachers to learn about and prepare for finance courses, providing up to 2,000 teachers with access to 20 hours of professional learning and the ability to earn up to $500 through a grant administered by Next Gen Personal Finance and the Stiles-Nicholson Foundation.

State Agencies Leading on Financial Literacy

State agencies, along with our nation’s Governors, have taken a leading role in providing individuals with the resources that they need to obtain significant financial knowledge.

In North Dakota, Governor Doug Burgum worked with his 11 state agencies to kick off Financial Literacy Month in April. As part of this month, the state launched the “Smart with your Money” resource designed to help North Dakotans navigate their financial needs.

In Vermont, Governor Phil Scott and State Treasurer Mike Pieciak worked with the Vermont Network Against Domestic and Sexual Violence and the Vermont Regional President of M&T Bank to establish a partnership that helps survivors of domestic violence gain stronger financial literacy skills. This program was launched in March 2024.

The Nebraska State Treasurer’s Office houses a series of useful resources for its residents, including three webinars, geared toward grade school students, high school students, and families.

Not only do state agencies contain resources, but they also set standards that educators should follow.

In 2017, the Arkansas State Legislature passed Act 480, which states that the Department of Education, in consultation with the Department of Career Education, oversees the development of personal and family finance standards.

Arizona’s Department of Economic Security established that financial literacy programs can qualify as a work activity for the purposes of the Temporary Assistance for Needy Families (TANF) program supporting TANF’s mission of achieving self-sufficiency.

Financial Literacy Work in Postsecondary Education

Governors and state education institutions are doing a lot of work across the continuum. Specifically, states have been relying heavily on postsecondary institutions to provide students with the knowledge that they need to take advantage of the many financial opportunities and resources that their Governors and states have made available to them.

In October 2023, Georgia’s Secretary of State’s Security Division hosted a financial literacy program at the University of North Georgia, highlighting the importance of empowering, educating, and encouraging students in Georgia to be financially fit.

Additionally, Indiana University has established a variety of financial wellness services, including an Office of Financial Wellness and Education, addressing issues related to affordability and reducing student borrowing levels. Since 2011, the Office has contributed to a $126.4 million reduction in student borrowing and a 23% decrease in borrowing across all Indiana University campuses.

In April of 2024, Delaware State University opened its new Charles Schwab Financial Literacy Institute in its College of Business. This partnership seeks to increase financial literacy across the state with workshops designed to help students navigate the transition from college into the workforce.

North Carolina State University has a financial wellness page with numerous useful resources to help its students and the public get the information that they need.

Texas A&M offers on-campus engagement events related to financial literacy and individual assistance through the Financial Education Coordinator’s Office. Beyond that, Texas A&M has a Financial Literacy fellowship program, in which those interested in helping others learn about financial topics can apply and receive a $2,000 scholarship per semester, encouraging students to both obtain a high level of financial literacy and then educate others within the community on these topics.

Fairmont State University developed the “Get a Life” program for the West Virginia State Treasurer’s Office, which teaches students statewide about the importance of managing personal finances through an engaging budget simulation.

The University of Wisconsin-Madison Financial Education program helps families achieve financial well-being with a focus on the following topics:

Building and Maintaining Credit Finding and Keeping Affordable Housing Saving for Post-Secondary Education Saving on Taxes Reentry Ready Resources

The University of Guam is offering its own Financial Literacy Certification program with a focus on teaching its students about income taxes and the importance of saving and investing early.

Additional Resources

The importance of financial literacy is becoming increasingly clear, and Governors are taking a leading role in making relevant information accessible. For more detailed information on the work that states are doing, please find the Postsecondary Education Financial Literacy resource page here. This page consolidates information on many of the resources that exist on financial literacy and highlights the work that states are doing in this area. Additionally, contact Abigail Rhim with NGA’s Postsecondary Education Team to learn more about upcoming financial literacy work within NGA.

1. North Dakota

North Dakota holds the top position from 2023 and remains the best state for starting a business in 2024. Its business environment is notably welcoming, with an LLC formation fee of just $135, making the entry barrier for new businesses relatively low. This fee is an important consideration for entrepreneurs who are mindful of initial expenses. The state’s business survival rate, sitting at a healthy 77%, reflects a supportive and resilient environment where businesses have a better chance of thriving.

This state’s appeal is enhanced by a cost of living index at 0.94, lower than the national average, and a significant portion of its population, 64%, that falls within the working-age range. These factors, along with its perfect scaled score of 100, highlight North Dakota’s comprehensive suitability for new businesses, combining economic feasibility with a robust labor market. The state not only offers financial incentives but also provides a solid foundation for workforce development, ensuring businesses have access to a skilled and able workforce.

2. Indiana

Indiana ranks second in 2024 as a highly favorable state for starting a business. Its business-friendly environment is highlighted by a modest LLC formation fee of $100, lowering the barrier to entry for new companies. The state also maintains a solid business survival rate of 77%, reflecting a stable and nurturing environment for business growth. Additionally, the average funding available for a small business in Indiana is notable, standing at $24,502, which signifies a supportive financial environment for entrepreneurs.

The economic appeal of Indiana extends beyond business statistics. The state boasts a cost of living index of 0.91, notably below the national average, making it an economically attractive location for both business owners and their employees. The demographic makeup of the state further adds to its attractiveness, with 64% of its population in the working-age bracket, indicating a substantial labor pool. All these factors contribute to Indiana’s impressive scaled score of 98 out of 100, making it an excellent choice for business ventures.

3. Arkansas

Arkansas is a highly advantageous state for starting a business, marked by several notable factors. The state offers an exceptionally low LLC business formation fee of just $45, one of the lowest in the nation, which eases the initial financial burden for new businesses. Arkansas has a business survival rate of 78%, suggesting a supportive environment that aids in sustaining and nurturing new enterprises.

It’s equally supportive of small businesses, offering an average of $23,463 in funding through grants and other programs to each, reflecting a commitment to entrepreneurial growth. The state also boasts a cost-effective living environment, with a cost of living index of 0.89, lower than many other states. This economic efficiency extends to both businesses and employees. Coupled with a workforce where 64% are of working age, Arkansas provides a fertile ground for new businesses, balancing affordability with a ready labor pool. Its scaled score of 93 out of 100 further attests to these qualities.

4. South Dakota

South Dakota presents a compelling case for entrepreneurs, combining several key attributes that help foster business growth and success. The state’s LLC formation fee is set at $150, balancing affordability with access to a range of business services. A noteworthy aspect of South Dakota’s business environment is its survival rate of 74%, which points to a supportive atmosphere for maintaining and developing new businesses.

The financial support for small businesses in South Dakota is particularly strong, with an average of $32,477 available per business, indicating a healthy investment in business growth via grants and other programs. The state’s cost of living index is 0.92, less than the national average, which suggests economic advantages for both businesses and their employees. Additionally, 62% of South Dakota’s population is of working age, providing a reliable labor force. With a scaled score of 85 out of 100, South Dakota demonstrates a well-balanced mix of affordability, business support and workforce readiness, making it a favorable location for new business ventures.

5. North Carolina

North Carolina offers a blend of supportive business elements. The state’s LLC formation fee is reasonably set at $125, striking a balance between accessibility and quality service. A significant advantage for entrepreneurs is the business survival rate of 77%, suggesting a nurturing and stable environment for startups. This rate reflects the resilience and potential for growth of businesses in the state.

Financially, North Carolina is poised to aid small businesses, offering an average funding of $22,019 via grants and incentives. This level of support shows the state’s investment in fostering entrepreneurial ventures. The cost of living index here is 0.96, aligning closely with the national average and ensuring affordability for business owners and workers alike. With 65% of its population in the working-age category, North Carolina provides a large labor pool. The state’s scaled score of 84 out of 100 reflects these combined advantages, making it a practical and promising location for new businesses.

Sarah Kourkoulis’ motto is “You’re younger than you think you are.”

The 47-year-old St. Johnsbury native, who is currently working toward her bachelor’s degree from the Johnson campus of Vermont State University (VTSU-Johnson), says her parents set that example for her. Her father Bobby, who ran a restaurant in St. Johnsbury for many years, emigrated from Greece in 1973. “I always thought he was so brave to leave his country at 23 years old and move somewhere where he didn’t even know the language,” says Sarah.

After her dad died in 2022, Sarah’s mom, Linda, who was born and raised in Essex Junction, followed his example in reverse. “She now goes back and forth between North Carolina and Greece, and she’s the one learning a new language at 74.”

“The fact that my parents started these new adventures has been an important part of my motivation,” says Sarah. “There’s so much more life to live and so many opportunities. You just have to be brave enough to take that first step.”

Sarah kept that foremost in mind when she decided, in her mid-forties, that it was time to pursue a college degree. That said, starting the journey at midlife made the finances a bit more challenging. “At this point in my life, I wasn’t looking to take out any more loans,” Sarah says. So the Vermont Teacher Forgivable Loan Program, managed by VSAC, came at a very opportune time.

“It paid for an entire year of school, plus some of the extra bills that went with it. Not only did that program make it possible for me to go back to school, but it’ll allow me to graduate with very little in loans,” she says. “When everyone was talking about Vermont needing more teachers, this program felt like a tangible way to keep us here. Being a teacher sometimes feels hard, but this was one part that felt really helpful and supportive.”

While she never got the formal training, Sarah has been teaching high school students almost since she finished up her own secondary education at St. Johnsbury Academy. “I always loved school, and when I started helping home-school my younger brother, who was 17 at the time, I found out I really liked teaching.” A family friend then asked if Sarah could teach their daughter Algebra I, and things progressed from there. “I loved getting to know the kids, building relationships with them, and taking a topic they were completely confused by and turning it around so they could see it differently.”

Sarah has worked with 20 home-schooled students over the last two decades. “My goal was to prepare them for life after school, to invite them to look at the world differently and appreciate it,” says Sarah, who created her own curriculum. “I wanted to teach some perspectives that might not be in the textbooks.”

By the time Sarah reached her early 40s, she was substitute-teaching at People’s Academy in Morrisville and she loved being part of a larger school-based community. But when her colleagues encouraged her to apply for an open position, she realized that, without a bachelor’s degree, she couldn’t get the job. “I had a lot of experience, but it wasn’t good enough,” says Sarah. “I was also very aware of my own limitations. Yes, I can teach, and there are a lot of parts of teaching I know I’m good at. But there were also so many tools I lacked.”

She began her college journey at the Community College of Vermont, where counselor Billi Dunham encouraged her to reach out to Ran Wang at VSAC. “I didn’t have the finances, and working with VSAC made it possible,” Sarah says.

At CCV, Sarah took the Assessment of Prior Learning course, in which adult students are asked to document their life experience in their field of study by writing essays and gathering letters of recommendation. “This was the hardest class I’ve ever taken,” Sarah recalls. “It was psychologically intense, going through your entire life and pulling out all of your learning. It was also therapeutic. I had some serious imposter syndrome,” she says, and putting all her experience down on paper, and asking others for help attesting to it, helped her realize how qualified she was. It also gave her a leg up; she earned 45 credits, including 11 courses of history.

History is one of Sarah’s favorite subjects to teach, especially to high school students who are just beginning to learn critical thinking skills. “I love to equip kids for the future, whatever that looks like for them, whether that’s college or a trade. But for every kid, it means understanding and appreciating history and asking, ‘How can we learn from this?’” Sarah would also like to create a financial literacy course for high school students. “Too many kids are getting in trouble with spending and borrowing and not understanding interest rates. Going into debt is not a great way to start out your life.”

Now in her junior year at VTSU-Johnson, Sarah is looking forward to practicums this fall and beginning her student teaching next spring. “It’s really been a gift,” says Sarah, who is grateful for the support she’s received from many places: family and friends, her employer—House of Troy lamp company in Hyde Park, where she works full-time alongside her courseload—to her counselors at CCV, VTSU, and VSAC.

“I had parents, family, and friends that were all super supportive of me. But for those who don’t have that, there is such a supportive community out there,” says Sarah. “No matter what, you will find plenty of people who believe in you.”

The Vermont Student Assistance Corp. was created by the Vermont Legislature in 1965 as a public nonprofit agency. We advocate for Vermont students and their families to ensure that they have the tools they need to achieve their education and training goals. We create opportunities for all Vermont students, but particularly for those—of any age—who believe that the doors to education are closed to them. Growing families save for education with VT529, Vermont’s official 529 savings program. To help Vermonters plan and pay for college or job training, our counselors work with students in nearly every Vermont middle school and high school, and are also available to work with adults. Our grant, scholarship, and workforce development programs create opportunity, help students re-skill or learn new skills, and grow the economy. VSAC’s loan and loan forgiveness programs provide competitive education financing to students and families. Find us at www.vsac.org or visit Facebook, Instagram, LinkedIn.

As the pandemic-era federal funding that propped up child care runs out — and the hope for Build Back Better becomes a memory — states are finding their own ways to cope with the ongoing crisis.

The so-called “funding cliff” has made the nation’s pre-existing child care challenges worse, causing closures of programs and classrooms, and increases in tuition and teacher turnover. All of this impedes the crucial development of America’s youngest learners, and impairs their parents’ ability to participate in the workforce.

In the absence of federal action, states have stepped up with their own solutions. At EdNC, a nonprofit news and research organization focused on expanding educational opportunities for all students in North Carolina, we got curious about how other states were coping.

EdNC’s early childhood team, with the help of student researchers at Duke’s Sanford School of Public Policy, identified five states that are leading the way in early childhood investment and policy. At the end of 2023, we visited Michigan, Massachusetts, Vermont, Oregon, and New Mexico, speaking with child care teachers, providers, advocates, organizers, business leaders, and other experts to learn how they got to where they are now.

Through our travels, we identified four strategies that most of these states have in place.

“The states that you’re looking at see this as a systemic issue and not the small, ‘It’s your problem, you deal with it,’ kind of thing,” said Whitney McCoy, a research scientist at Duke’s Center for Child & Family Policy.

A Michigan model that shares the cost of child care between state government, businesses, and parents is spreading across that state. In Oregon, leaders are tackling child care access from several angles with a new statewide early childhood department at the helm. In Massachusetts, the state is replacing federal relief dollars to avoid the child care cliff, and localities are expanding pre-K.

And in Vermont and New Mexico, recent legislative wins set up those states to create universal early care and education systems.

“First and foremost, we have to recognize this is a systemic problem and that it’s going to take a systemic solution,” said Kristi Snuggs, president of the Child Care Services Association.

Here are four ways states are doing that.

Liz Bell/EducationNC Mebane Rash/EducationNC EdNC’s early childhood team, Katie Dukes and Liz Bell, visit with pre-K students at Mission Grammar School-Our Lady of Perpetual Help in Boston.

1. Advocacy from the business community

States leading early childhood policy are doing so with support from their business communities.

In many cases, policy leaders told EdNC, this support was not just helpful, but necessary for progress.

In Michigan, it was cross-sector leaders on the state’s Women’s Commission who heard of child care concerns from their parent employees and launched MI Tri-Share in response.

The program relies on businesses to cover a third of the cost of eligible employees’ child care. The other two-thirds is split between the employee and the state.

Employers are pitching in with an understanding that turnover costs them more than their share of that child care cost. Plus, recruitment is easier when companies offer benefits that parents desperately need, participating business owners told EdNC.

Models based on this program are catching on elsewhere, including Kentucky and New York. North Carolina will try one this year.

Michigan Women’s Commission Chief Strategy Officer Shannon Garrett, CEO Cheryl Bergman, and Commissioner Geneva Williams meet for the group’s September 2023 discussion at Wayne State University. Liz Bell/EducationNC

Business leaders also are showing up at statehouses to push for public policy and investment, and they’re showing up in communities to organize efforts that increase access to child care.

Advocates at Let’s Grow Kids (LGK), a Vermont nonprofit created to push for child care investment, assembled a team of business leaders from across the state and led a six-week sprint on early care and education.

Aly Richards, CEO of LGK, said business leaders at first wanted to see the budgets of child care programs, confident the problems could be solved with smart financial management. Then they showed them those budgets.

“They’re like, ‘Oh, I understand, this is a market failure. It’s a business model failure,’” Richards said.

In other words, child care businesses cannot create the desired product (high-quality care) at a price that is affordable for most parents. Treasury Secretary Janet Yellen in 2021 called child care “a textbook example of a broken market.”

Some of the Vermont business leaders also wanted to open on-site programs, Richards said. Advocates then explained the factors that would be draining on those operations, including a shortage of early childhood teachers.

“It’s not systemic, it’s not equitable,” she said.

Once the business leaders got on board that public investment was the only answer, LGK advocates gave them a list of Vermont’s revenue sources and asked them to choose a funding lever. The business leaders did an analysis, chose a payroll tax, and pushed for it in the legislature.

“Each of them said, ‘Tax me,’” Richards said. “Vermont makes more money, I make more money, my employees make more money, and we pay off this payroll tax surcharge, basically, before half the year’s over. That was the sort of final thing that pushed us over the finish line.”

Students at Mission Grammar School in Boston get moving. Liz Bell/EducationNC

2. Grassroots organizing

The most powerful advocacy efforts in the states EdNC visited centered the people most affected by the policies they were backing.

On the local level, the activism of parents with young children led to the passage of Multnomah County’s Preschool for All initiative in Oregon, which is working toward universal preschool access for 3- and 4-year-olds through a marginal tax on high-income residents and workers.

The Parent Accountability Council (PAC) formed a vision for pre-K access that went beyond state program standards.

“We wanted classrooms that look like us,” said PAC member Lydia Gray-Holifield. “We wanted classrooms that spoke our languages. We wanted classrooms that greeted our parents when we walked in the door. We want our kids to feel safe and comfortable.”

The PAC held regular community focus groups and cafes, and then brought recommendations to the table.

Their input is now baked into the Preschool for All initiative, leading to program elements that are rare in public pre-K programs. They made sure the pre-K day lasted the full workday, that exclusionary discipline was not an option, that parents had a pathway to become teachers, and that all types of community providers were involved.

In some cases, successful advocacy is not about reinventing the wheel, but about consistency and determination, leaders told EdNC.

Related reading

Advocates in Massachusetts created a simple tool that kept everyone in the early childhood community on the same page throughout and since the pandemic: the 9:30 call.

In March 2020, advocates started holding an open Zoom meeting with the same link every day, five days a week, to share challenges, ask questions, and tell decision-makers how policies were playing out. The call outlasted the pandemic as a way to coordinate efforts and connect early childhood professionals across the state with experts and elected officials.

“It has changed the way we do everything,” said Amy O’Leary, executive director of Strategies for Children, a nonprofit. “I call it unfiltered advocacy.”

More than 1,400 people have joined the calls, with a daily attendance of 75 to 100. The call has helped a broader geographic representation be involved in creating a statewide Early Childhood Agenda. Now other leaders are looking at the tool as a case study for building community virtually.

In both Vermont and New Mexico, advocates rallied behind electoral candidates who were committed to passing early childhood policies.

“They basically removed the barriers at the legislative level, and put in people that were friendly to early childhood,” said Catron Allred, director of the Early Childhood Center for Excellence at Santa Fe Community College.

Let’s Grow Kids in Vermont created a dashboard of 40,000 people who have engaged with the campaign to pass Act 76 over a decade. That’s 5% of the state’s population. Advocates sat at farmer’s markets and fairs to talk to passersby about child care and ask for contact information or signatures.

When a legislative committee needed to hear about child care issues, it would take only a couple of minutes to send out an accessible form through the dashboard for people to share their stories.

“When we started using that, it really upped the game,” said Shayla Zammuto, senior field manager for LGK. “Like thousands and thousands and thousands of messages into legislators each session — it’s really hard to ignore.”

A teacher at The Homestead, a private child care program in Burlington, Vermont, reads to students. Liz Bell/EducationNC

3. Streamlining governance

Governance structures matter, experts from every state told EdNC.

While EdNC was in Michigan, a new department was announced, the Department of Lifelong Education, Advancement, and Potential, that brings together programs from early childhood to higher education, including MI Tri-Share. It was a necessary step for the statewide expansion and long-term sustainability of the program, said Cheryl Bergman, CEO of the Women’s Commission.

In Vermont, a public-private partnership called Building Bright Futures provided essential support to the Democratic-led legislature and the Republican governor’s office during the passage and implementation of Act 76.

The organization sits outside of state government, and its members advise both the legislature and the executive office on early childhood policy. They bring together a network of 500 people monthly through 12 regional councils. They do not advocate for any particular policy, but present data and input from across the state to elected officials.

“It’s really about saying, based on these conversations with community partners, with families, with the state advisory council, and our other network bodies, this bill is well-aligned with what we’re hearing,” said Anna Brouillette, the group’s policy and program director.

The group is able to hold the state’s early childhood vision through political turnover, a thread we noticed in several states. In New Mexico, for example, the Legislative Finance Committee — a body that combines fiscal analysis and program evaluation — was able to act as a nonpartisan, research-backed voice through several gubernatorial administrations and legislative turnover.

In 2019, Oregon created a standalone early childhood department. New Mexico followed suit in 2023.

The creation of new departments has helped bring policies and programs from several agencies under one umbrella to better coordinate services and make navigating those services easier for families. It’s also made sure early childhood issues are not lost within larger departments and conversations.

“We wouldn’t be able to have conversations in the same holistic way and coordinated way and leverage the funding that we have from the feds and the state together to solve any of these issues — access, quality, workforce — that exist in our field, without a cabinet-level agency,” said Sara Mickelson, deputy cabinet secretary of New Mexico’s Early Childhood Education and Care Department.

Students in classrooms at Mission Grammar School in Boston, Rock & Roll Daycare in Cambridge, and Kids Campus in Santa Fe. Liz Bell/EducationNC

4. Identifying/creating new funding streams

Early care and education is expensive. The cost is being subsidized now through high costs for parents and low wages for teachers.

As state governments play a bigger role in covering that cost, they are finding new sources of funding to help parents afford care and to raise teacher pay.

In some cases, those are funds earmarked for early childhood out of a larger pot of money.

The Land Grant Permanent Fund, through a constitutional amendment in New Mexico, has been opened to early childhood, sending about $150 million to the Department of Early Childhood Education and Care annually. The fund, the largest of its kind in the country, is financed by leases and royalties on non-renewable natural resources in the state. It will send $1.34 billion to beneficiaries (mostly K-12 public schools and universities) this fiscal year.

In Oregon, the Student Success Act of 2019 sends 20% of its annual $1 billion distribution to the state’s Early Learning Account.

Every year about $10 million from the account is reserved for the Early Childhood Equity Fund, which goes exclusively to culturally specific organizations “that focus on closing opportunity gaps for children and families who face historical and current inequities due to factors such as race, income, zip code, or language,” its website reads.

In other states, increased taxes or new mechanisms are sending consistent public funding to early childhood systems.

For example, New Mexico’s legislature in 2020 established the Early Childhood Education and Care Fund, which is funded by oil and gas revenue and dedicated to early childhood programs and services. The fund sent $150 million to early care and education last year, with projections to send $486 million annually by 2028.

And just last year, Act 76 in Vermont established a Child Care Contribution, consisting of a 0.44% payroll tax and a 0.11% self-employment income tax. The tax will provide $125 million in child care funding annually.

Each of these streams is specific to the state’s context and resources. But they are “all based on a key principle that public investment is the missing piece of the puzzle,” said Richards from LGK in Vermont. “Period.”

Behind the Story In the fall of 2023, EdNC’s early childhood team visited five states leading the way in early childhood policy and investment. In January of 2024, EdNC published an article with insights from that research for North Carolina. This piece is an edited version without North Carolina’s context to share lessons with a national audience.

Liz Bell Email Liz Bell Liz Bell is the early childhood reporter for EducationNC.