Quality child care is an essential component of our nation’s infrastructure, with significant benefits for parents, children, businesses, and the economy. It allows parents, particularly mothers of young children, to participate in the workforce. Businesses benefit when parents have reliable child care, increasing productivity and strengthening a stable, dependable workforce that supports the broader economy.2 Quality child care also benefits children, with positive impacts on multiple aspects of development. Yet America has a fragmented child care and early learning system that doesn’t meet the needs of families, businesses, or early educators. Families struggle to find and afford child care, the child care workforce is woefully underpaid, child care programs operate on razor thin margins, and businesses are suffering lost productivity and workforce turnover due to child care issues.

In order to better understand the current state-by-state funding landscape, Child Care Aware® of America (CCAoA) conducted a study of Fiscal Year (FY) 2026 state child care and preschool funding, focusing on investments from state general funds above federally required matching and maintenance of effort (MOE) funds. Responses came from experts in state finance and budget divisions, and state policy and budget organizations, in 44 states and Washington, D.C. The report updates research CCAoA completed in 2025,4 providing new data on state funding for FY 2026 and allowing year-over-year comparisons for a subset of states with data for both years.