2/12/26 ECEA Child Care Update

The CO Child Care Landscape is Shifting

The face of child care in Colorado is shifting dramatically—and not in a way that supports families or the diverse providers who have long served them. Community-based and home-based child care providers are closing at rates that far outpace new openings, while school districts increasingly dominate new licensed capacity. This isn't accidental; it's the result of financial incentives, enrollment pressures, and policy choices that favor public systems over private and non-profit ones.

Using quarterly lists of active providers obtained through a standing CORA request, a side-by-side comparison of January 2024 and January 2026 data reveals the stark reality. After applying conditional formatting to remove duplicate licenses (programs that remained open) and duplicate addresses (those that sold and reopened under new ownership), the net result is clear: 104 centers completely closed—all community-based, none operated by school districts. These independent providers often walk away with minimal assets, unable to sustain operations amid rising costs, regulatory demands, and subsidy challenges.  They often walk away with outstanding debt and no retirement.

Meanwhile, new programs built on fresh infrastructure tell a different story. Of those entirely new licenses, 76% are school district-operated. The vast majority operate as child care centers (not just preschools), allowing extended hours and direct competition with private and non-profit programs for working families needing full-day or flexible care.

This expansion into early care comes as school districts grapple with a significant K-12 enrollment drop. For the 2025-26 school year, Colorado public schools lost over 10,000 students—total enrollment falling to about 870,793, a 1.2% decline (the sharpest since the pandemic). With 2026 figure setting for per-pupil funding being likely set at $8,909.10  and a loss of roughly 10,000 students translates to approximately $89 million in foregone revenue—a substantial hit that districts are offsetting by expanding into child care slots, leveraging stable public funding streams unavailable to private providers.

Prior to Universal Preschool (UPK), the Colorado Preschool Program (CPP) served about 12,766 four-year-olds in public settings. UPK has grown access significantly, but the delivery mix raises questions about true "mixed delivery." A recent UPK report (from last year, page 17) shows school-based providers serving the largest share: 54.7% of children. Overall, 43,398 children were served system-wide, with 23,726 in school district settings, 927 in homes, and 18,745 labeled "community-based."

That 43.2% community-based figure is misleading. Head Start and Early Head Start providers—often lumped in—are not fully separated, as some slots blend funding streams and reporting challenges persist. A requested list identified 306 such providers classified as community-based. Nationally and state-reported data suggest Colorado Head Start serves roughly 7,552+ preschool children (ages 3-5). Adjusting based on the number of Head Start Preschool slots we have a different picture entirely:

• 43,398 UPK children total
• Minus 23,726 school district
• Minus 927 homes
• Leaves 18,745 "community-based"
• Minus anywhere from 2,517-7,552 Head Start preschool slots for CO 
• That leaves us with around 11,245-16,228 in truly private and non-profit settings.

This equates to closer to 26-37% of UPK slots in independent community programs—not the balanced mixed delivery often touted. The increase in school district-served children (from pre-UPK baselines) draws heavily from slots previously served by community providers, as evidenced by closures and an industry survey showing enrollment numbers—not capacity—as the top challenge facing child care businesses today.  ECEA Members and those that provided their emails in the Industry Snapshot will see those details today!

When government entities compete directly with private industry, the smaller players lose. School districts benefit from property tax revenue, state income/sales taxes, bonds, federal funds, and exemptions from property taxes (which can cost private providers $150,000+ annually). They face fewer market risks and can absorb losses in ways independents cannot. Emerging legislation could grant districts even more advantages, further tilting the field.

State officials often point to overall capacity numbers, claiming "more now than before." But digging deeper reveals a landscape shifting away from private, community-rooted care toward centralized, district-run options. This limits parent choice, reduces flexibility for non-standard hours or personalized environments, and erodes the diverse ecosystem that has supported Colorado families.

As an industry deeply invested in this issue—and the focus of our weekly update—we're committed to sharing this data widely. Families deserve genuine options, not a quiet consolidation that prioritizes public systems over the independent providers anchoring neighborhoods and enabling working parents. The child care crisis isn't solved by numbers alone; it's about who delivers the care and whether families truly have choices.  If we aren't careful child care in Colorado will ONLY look like:

**The numbers contained in this story are as accurate as possible.  The Head Start numbers are exceedingly difficult to pin down but we've done that by averaging  3 years of data and including possible spread.  

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