Strong Foundations: Strategies for Childcare Capital and Supply-Building Solutions
Child care is an essential pillar of economic stability and workforce participation, yet it remains a persistently underfunded and fragile sector. The high costs of providing care, coupled with financial and regulatory barriers, create an unsustainable business model that limits accessibility for families and opportunities for providers.
This report highlights critical funding gaps and presents actionable strategies for employers, policymakers, and funding partners to strengthen childcare infrastructure and sustainability in Colorado.
Key Challenges
- Unsustainable Business Model: Child care providers operate with razor-thin margins, making it difficult to sustain operations, pay staff livable wages, and offer affordable tuition for families.
- Limited Access to Capital: Providers, particularly women- and minority-owned businesses, struggle to navigate complex financial systems and secure necessary funding.
- Inconsistent Public Investment: With the expiration of federal stimulus funding, Colorado faces a looming crisis that could further erode childcare availability.
Recommended Strategies for Colorado
- Fund Capital Programs for Childcare: Incentivize local and state efforts to support capital needs of childcare.
- Include Childcare in Public Infrastructure: Positioning childcare facilities as essential infrastructure through public domain ownership and development.
- Invest in and Protect Real Estate for Childcare: Investing in childcare businesses through real estate ownership, supported by lease-to-own agreements and mission-driven equity investments.
- Create a Revolving Loan Fund in Colorado: Establishing a low-cost loan fund supported by philanthropic and public-private capital to provide sustainable financing for childcare providers.
- Streamline Access to Financial Opportunities: Creating a centralized resource hub for funding and financing opportunities as well as dedicated technical assistance programs to ensure access to capital for childcare providers.
The report emphasizes the financial pillars crucial for successful childcare investment:
To move forward and assess the feasibility of these recommendations, funding and finance partners must engage in the following next steps:
- Develop a plan to launch new funding and financing opportunities for childcare by November 2025.
- Identify and engage state departments, non-traditional lenders, philanthropy and other investment partners with the interest and administrative capacity to lead recommended solutions and activities.
- Secure commitments for a minimum of $10 million in public, private, and philanthropic funding sources that can be committed to a pilot in a minimum of 3 Colorado counties by the end of 2026.
- Direct resources to areas of highest need to pilot best fit approaches.