The Colorado child care industry stands at a profound crossroads in early 2026. Our latest 2026 State of the Industry report paints a stark picture: a sector facing enrollment declines, capacity gaps (with only 73.8% utilization across surveyed providers), and intense financial pressures driven primarily by enrollment decreases, CCCAP freezes, and policy impacts like Universal Preschool (UPK). Providers report being fully staffed at 69% for current enrollment, yet this masks a "precarious equilibrium" where competitive wages remain the top challenge, administrative burdens overwhelm daily operations, and behavioral/mental health needs in classrooms add complexity without adequate support.

Many programs are struggling to stay afloat or at risk of closure, with the "double squeeze" of CCCAP freezes and UPK shifting four-year-olds to public districts destabilizing private markets. Providers' own words echo frustration with over-regulation, uneven funding, and policy imbalances—yet they remain deeply committed to children, families, and quality care.

This moment forces a fundamental question for every owner, director, and community-based program: Which road do we choose?

One path leads toward full government funding (and control) of child care, potentially through systemic changes like a graduated (progressive) income tax system. Advocates, including the Protect Colorado's Future coalition, argue this would modernize Colorado's flat tax, lower rates for most residents (especially those under $500,000), and generate billions in new revenue to invest in child care, K-12 education, health care, and families. Proponents see it as a fairer way to fund  services, reducing reliance on  federal dollars and decreasing fiscal pressure on citizens in the state.

The other path emphasizes a free-market approach, where private providers operate with less government intervention, lighter regulation, and market-driven solutions. Critics of expanded government involvement point to current challenges—such as CCCAP freezes contributing to financial distress (programs citing them are nearly 3x more likely to struggle) and UPK's unintended consequences—as evidence that more government funding and control may not fully resolve issues and could add layers of bureaucracy or unintended market effects. They advocate for deregulation, reduced administrative burdens, fair competition, and targeted supports without shifting to full public funding. It's worth reflecting on how the landscape has evolved over the past decade, with increasing policy interventions coinciding with increasing affordability and access concerns for many families and providers.

ECEA's position is clear and unwavering: We support you, the providers, regardless of the direction the industry collectively chooses. Whether your program leans toward advocating for robust public investment to stabilize and expand access, or toward preserving private-market flexibility with streamlined rules and targeted relief, ECEA will continue providing resources, advocacy, data, networking, and voice to help your business thrive and serve children effectively.

Politics and policy will drive us down one road or the other—or perhaps a hybrid path blending elements of both. If you believe hybrid works, I challenge you to consider that we are in a hybrid mdel right now.  CCCAP and UPK are government funded and managed programs AND you get to operate your business in the free market system at the same time.  Maybe that is working for you, maybe it's not.  As community-based programs rooted in local needs, your perspective as owners matters immensely.  We are always going to seek to inform owners/directors of the true impacts of policy on your business.  You may not always agree with our perspective but you need to know we will not sit by silently while public policies continue to make it harder for you to run your business. 

Which road do you choose?  Members, we will likely be asking for your input on this in the near future through a quick survey. Together, we can shape the future that best supports Colorado's children, families, and providers.

For a deeper dive into the data fueling this crossroads—including charts on enrollment, capacity gaps, financial pressures, the "double squeeze" of CCCAP and UPK, risk of closure, business pivots, staffing equilibrium, operational challenges, provider asks, and confidence levels—review the full 2026 State of the Industry Snapshot at www.coloradoecea.org/provider-voices.

Stay strong and connected—we're in this together.  

Quick Note:  If you have any doubts about the impacts of over-regulation and increased taxation on corporations and the wealthy as a "fair" tax, review the Colorado Chambers Relocation Tracker. Ask yourself, who pays the taxes when companies leave?  

ECEA Members Minute (click here)

Member's ONLY content this week.  If you click on the title and can't get in reach out to Dawn for support.

• Members please keep pushing back on draft legislation.   WE NEED MORE OF YOU TO SEND YOUR LEGISLATORS LETTERS!!
• CCCAP Update
• Filing Taxes - Avoid Care Credit Issues
• Advocacy in Action

Struggling to See Value in Membership?

Hear what one of our members told us last week: 

“The ECEA Career Plug program has saved our school over $40k in Indeed advertising costs per year.  An absolute homerun for early childhood business owners!”  MJM

That's just ONE of our partnerships.  If you are spending over $720 a year on hiring, you will save from CareerPlug.  That's doesn't include the number of hours every month CareerPlug saves you.  Join now as a Pro or Plus member and add on CareerPlug today!

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 If you are just enjoying the benefits of our policy work without joining, you need to ask yourself...what if ECEA's voice disappears?  Who would speak up for you then?