Celebrating Momentous Child Care Policy Reforms in the FY25 State Budget
Since our founding in 2017, Neighborhood Villages has been working tirelessly with partners, advocates, and elected officials to enact desperately needed policy reform for Massachusetts’ early education and care sector.
Last week, we saw a huge return on those efforts when Governor Maura Healey signed the Commonwealth’s Fiscal Year 2025 (FY25) budget, which included landmark child care policy reforms that will increase access to more affordable child care for thousands of Massachusetts families. This year’s budget is truly a cause for celebration and we want to make space to fully appreciate the pivotal moment this is for Massachusetts children, families and educators.
Now, when people think of state budgets, they most often think of funding — more specifically, how the government is going to spend its tax revenue for the coming fiscal year. And this budget did make a record $1.5 billion investment in the child care sector.
However, this year’s budget is unique because, in addition to allocating significant funding to early education and care, it also includes substantial policy changes. These changes draw on policy provisions proposed in recent bills, including the Early Ed Act, that we have long been advocating for.
The policy provisions in the FY25 budget create a framework that will make child care more affordable for more families, improve compensation for educators, and provide the child care field with more stability.
Affordability for Families
The budget makes care more affordable for more families by expanding access to reduced-price child care through the Massachusetts child care financial assistance program (CCFA), first to families making up to 85% state median income (SMI), and ultimately to families up to 125% SMI. It also permanently makes care free for families with incomes under the federal poverty line who qualify for CCFA. And, with these new policy changes, families receiving child care financial assistance will also pay no more than 7% of their income for care.
Notably, this year’s budget makes permanent the Commonwealth Cares for Children (C3) operations grants program, which provides foundational funding directly to early childhood education providers. The operations grants program has proved to be one of the state’s most impactful public interventions when it comes to strengthening the capacity of the child care sector. Since 2021, the C3 program has enabled providers to raise educator wages while holding tuition steady — and, in some cases, even reducing it. Making the C3 grants program permanent is a huge win for providers, families, and educators.
Support for Educators and Providers
The budget supports early educators by making permanent both scholarship and loan forgiveness programs and directing the Department of Early Education and Care (EEC) to develop a career ladder for early educators that includes salary and benefit guidance for each level.
It also codifies important guardrails to ensure that state funds serve children and raise teacher compensation. The language in the budget limits how much public funding large for-profit providers are eligible for in C3 funds. Large for-profits (defined as a provider operating or licensing 10 or more for-profit programs in Massachusetts) must accept children receiving CCFA at each of their programs, will be limited to 1% of total grant funds, will have to spend a certain percentage of their grants on salaries, and will have to submit an annual report auditing how they spent their grant funds.
To learn more about the early education provisions of the budget, check out our FY25 Budget Debrief.
While there is much more work to be done — including ensuring that funding for early education continues to be a consistent priority in the years ahead — we hope you join us in celebrating the FY25 budget as a major step toward child care transformation in Massachusetts.
