New Bills Aim to Stabilize and Expand Colorado’s Child Care System

A full version of this article was originally published by Ed Sealover on The Sum & Substance on February 18, 2026.

Over the past four legislative sessions, Colorado lawmakers have advanced policies intended to improve child care access and affordability. Despite these efforts, survey data indicates that many parents still report high costs and difficulty finding available providers.

During the current session, child care advocates have introduced four bills designed to support providers in managing costs and to streamline regulations related to opening and operating child care centers. The proposals have received bipartisan support. At the same time, some industry stakeholders have raised broader policy questions about the state’s role in the child care sector and its long-term sustainability.

Colorado faces a shortage of up to 70,000 child care slots based on current demand, according to EPIC President and CEO Nicole Riehl. A study from ReadyNation estimates the economic impact or this shortage at $3.3 billion annually, accounting for workforce disruptions, reduced productivity and parents leaving or scaling back employment due to lack of care.

The growing role of school-based preschool programs

A February report from the Early Childhood Education Association of Colorado (ECEA) found that enrollment declines have left the average child care center operating at less than 75% capacity, with centers serving school-aged children operating at approximately 55% capacity. ECEA Executive Director Dawn Alexander noted that these changes coincide with the growth of preschool programs located within public schools that also offer child care services. Independent child care centers continue to navigate regulatory requirements while serving families and meeting local demand.

Between January 2024 and January 2026, 104 child care centers closed across Colorado, while 76% of newly licensed facilities are operated by school districts. While gaps in access remain in some communities, these trends highlight the evolving landscape of early care and education and the ongoing need for coordinated efforts to meet the needs of families across all age groups.

Industry stakeholders support this year’s legislative proposals, which include tax credits and regulatory reforms designed to strengthen the child care sector and expand access for families. The measures are seen as important tools to support providers in addressing areas of highest demand, including infant and toddler care and flexible scheduling to meet parents’ work needs.

Several years of legislative child care efforts

The state government has taken on an increasing role in child care funding over the past decade, recognizing that access to care is essential to a strong workforce and economy. Since 2022, lawmakers have introduced grants, tax incentives and programmatic supports aimed at expanding capacity and improving affordability for families across Colorado.

As policymakers continue to refine these efforts, several proposals this session focus on strengthening and sustaining the child care sector — including extending a key tax credit that has supported providers statewide.

Child care tax credit extension

House Bill 26-1004, which passed its first committee unanimously on Feb. 5, would extend an important tax credit for people who contribute money to child care centers by another 10 years. Another bill, Senate Bill 26-020 would ease several regulations on child care center operators and set up a task force to recommend changes to boost the sector. Two other proposals — SB 26-019 and SB 26-050 — would streamline local organizations that seek to help child care providers and would provide parents information on how centers that offer live streaming of their children store and use that footage.

HB26-1004 would continue the state income tax credit equal to 50% of charitable contributions to eligible child care organizations, up to $100,000 per taxpayer. The credit currently generates approximately $60 million annually in private contributions, available to an estimated 6,000 organizations statewide. For comparison, the state allocates approximately $32 million annually in grants to help offset the cost of care for children from lower-income families.

Supporters of the tax credit regaled the House Finance Committee with details about what it’s meant for them. Parent Possible Executive Director Brad Conley said the money raised from donations allows his organization to provide below-market-rate occupational and speech therapy and offer a summer camp for kids with special needs. Big Brothers/Big Sisters of Colorado CEO Elycia Cook said that pitching the credit at a fundraiser helped her organization raise a record $540,000 to serve needy families.

“We absolutely couldn’t do it without the child care tax credit,” added Stephen LeFaiver, executive director of Teens Inc. in Nederland, who said the proceeds are used to reduce fees and raise wages for his staff. “Without it, we will have to substantially raise our fees and reduce the amount of subsidized care we can afford.”

Regulatory reform in sector

Much like HB26-1004, SB26-020 would address several pinch points with which childcare operators have struggled. It would phase out third-party facility inspectors and standardize protocol for investigations and allow centers to operate for as long as nine months under a state permit if they are in a zoning dispute with a local government that has held up opening.

But it also would create a child care licensure and quality task force to recommend ways to streamline the state’s child care licensure system and make it easier to use, with findings due by the start of 2027. Riehl said the bill would help existing centers to stay in business and new centers to come online. Alexander said it would allow participants to look at the interactions between the private-sector facilities and the state’s universal preschool program and figure out how the two could work better together.

“These are largely small businesses that are running child care facilities … and we want to make sure that the regulations are not too overly burdensome,” Riehl said recently on the “Colorado Chamber Office Hours” podcast. “We are taking advantage of technology and streamlining processes where we can, understanding this is usually one business owner who is wearing the typical 20 hats, trying to do all the things at once. And we don’t want it to be so cumbersome or so burdensome for them that they either leave the industry, or they don’t even start a business to begin with.”

Newly opened center offers perspective

Late last year, Amy Carr opened the Gilpin Mountain Kids Early Learning Center — the only facility serving children from ages two months to six years that is located between Nederland and Idaho Springs. She’s worked closely with local officials and appreciates their cooperation, she said.

However, she was surprised by the amount of regulation that was required to open a child care center in a facility that housed a separate child care center just three years ago. She had to get numerous waivers regarding the number of sinks in her facility and the access to an outside door, and she noted that officials only considered and approved such waivers on a monthly basis.

Carr said she hopes that legislators can see the need for streamlining the regulations around the industry so that other entrepreneurs like her can open centers in other counties that now lack them — a key to serving working families across the state. And she hopes to take advantage of the tax credit if it is extended.

Carr previously participated in the Child Care Technical Assistance Cohort, a program facilitated by EPIC on behalf of the Colorado Department of Local Affairs with support from the Colorado Department of Early Childhood and the Colorado Office of Economic Development and International Trade. The cohort provides technical assistance to communities and employers working to expand child care supply. Funding for the program, supported through House Bill 24-1237, may face reductions this legislative session due to broader state budget constraints, but if the statute is preserved will continue to be eligible for gifts, grants and donations.

EPIC facilitated the connection between Amy Carr of Gilpin Mountain Kids Early Learning Center and Sum & Substance reporter Ed Sealover for this feature. We’re proud to see Gilpin Mountain Kids recognized and are grateful to the business leaders and media partners who continue to highlight child care as essential community infrastructure.