How State, Federal Funding Cuts Could Affect Child Care Assistance for Denver Families

The cost of child care continues to rise while funding for child care assistance in Colorado and federally lag behind demand, or is under threat of being cut altogether. Child care in the US has long been considered a broken market, meaning it doesn’t work for the child care providers (many of whom live below the poverty line with a median wage of $15.41/hour) or families (many of whom spend more on child care than college tuition). 

COVID-19 stimulus funding lifted up the sector like never before and brought much-needed wage increases to child care providers. But now as stimulus funding has run out, communities across Colorado and the U.S. are struggling to provide families with child care assistance subsidies. 

The Trump administration has hinted at eliminating funding for the 60-year-old federally-funded Head Start program (although Head Start wasn’t mentioned in the most recent budget). Meanwhile, state funding for the Colorado Child Care Assistance Program (CCCAP) is facing more demand than current funding can support. Early Milestones Colorado, a nonprofit that uses research to create solutions for Colorado children and families, recently conducted a survey that found that 2 in 3 child care providers in Colorado relies on some federal funding (and 1 in 3 providers has multiple programs depending on federal funding). 

So how do funding shortfalls for CCCAP and potential federal cuts to other programs like Head Start have a potential impact on Denver families? Learn more as we unpack each program and child care assistance funding concerns. 

How do Head Start and CCCAP help Denver families?

Let’s start with a few definitions about how federal and state funding for child care works in Colorado. 

• Head Start and Early Head Start: Established by the federal government 60 years ago, these programs provide child care assistance and support for health, early learning and development, and family well-being for prenatal women and children ages 0 to 5. 
  • To qualify, families must make under the federal poverty level ($31,200 for a family of four) or be receiving public assistance (TANF, SSI, or SNAP). Children in foster care or children who are homeless, also qualify regardless of income. 
  • The State of Colorado does not contribute any state funding to Head Start (14 other states do contribute to their local programs). Federal funds for Head Start are distributed directly to local programs in Colorado. According to the Colorado Head Start Association, federal funding provides more than $119 million to 50 early childhood education providers in 34 Colorado counties, impacting more than 11,000 children. 
• Colorado Child Care Assistance Program (CCCAP): CCCAP offers child care assistance to families who are in school or a job-training program, are looking for work, or are working. 
  • Each county sets their individual eligibility requirements for families; however, all families that have an income of 185% or less of the federal poverty guideline are eligible. Denver County currently sets its CCCAP eligibility at 225% of the national poverty level. 
  • CCCAP is funded by the federal Child Care Development Fund (CCDF) as well as from state and local funding. 
  • Many counties including Denver County have implemented a CCCAP freeze due to lack of funding and are prioritizing families who are currently enrolled in CCCAP. Denver County placed a freeze on accepting new families into CCCAP in January 2025. Programs including CCCAP were able to support more families during and directly after the COVID-19 pandemic due to stimulus funding, but now are facing more demand than funding can support. 
  • Projections show that the State of Colorado would need $70 million to accommodate the demand for CCCAP in the next 3 years, but only $10 million of that has been allocated in the state budget. 

What happens when families cannot afford child care?

The cost of center-based child care for children ages 3-6 in Denver County was 22.1% of median household income in 2022. For full-time preschool in Denver, the cost is approximately $1,600/month. For infants and toddlers, cost of care is 28.6% of median household income, making Denver County the third most unaffordable county in the state according to the Bell Policy Center. This same research also found that the cost of child care expenses in Colorado during 2022 was more than double that recommended by the U.S. Department of Health and Human Services, which states that for child care to be affordable, it should not account for more than 7% of a family’s income. 

In addition to the cost of care, many families simply cannot access care as there is an estimated shortage of more than 40,000 child care slots for children under the age of 6 in Denver. Statewide, there are only 2 licensed child care slots for every 3 children under the age of 6. 

When Denver families cannot access or afford child care and preschool, many parents or caregivers are forced out of the workforce. More than 1 out of 10 children had a parent quit a job, turn down a job, or change their job due to child care issues. Single mothers with children under 5 are disproportionately affected by childcare issues.  And two-thirds of mothers considered leaving the workforce because of the cost and stress of child care. Colorado loses roughly $2.3 billion annually in terms of lost earnings as a direct result of child care inaccessibility. 

What can Denver families do to save on preschool costs?

All families who live in Denver can qualify for Denver Preschool Program tuition credits the year before kindergarten, and many families with 3-year-olds may also qualify. DPP tuition support can be combined with Colorado Universal Preschool (UPK).. By doing so, families can receive roughly $1,200 per month, on average. Many families who qualify for Head Start and/or CCCAP can save even more. Plus, DPP and Colorado UPK offer additional preschool tuition support, based on family income. And certain families may qualify for support for their 3-year-old from DPP and/or Colorado UPK. DPP recently announced our tuition scale for the 2025-2026 school year, which remains unchanged from the current school year. DPP provides tuition support year-round, including the summer months. 

Learn more about how to Get Tuition Assistance and save on your preschool costs.