Child care in North Carolina is reaching a crisis point. The state decreased its spending on child care from FY25 to FY26; more child care programs are closing than are opening; and the General Assembly has failed to pass a budget in more than two years, depriving the sector of much-needed funding.
The state’s recent move to modernize its child care licensing system, dubbed Pathways to the Stars, may just be the final nail in the coffin. The mandates, which are tied to licensing, impose additional hurdles for providers and cost more time and money. All this while child care subsidies that help low-income families cover costs have stagnated since 2021. This needs to change.
On May 11, the Child Care Commission is set to hold its next public hearing. Hundreds of parents, childcare providers and advocates, including myself, plan to attend. Our message is clear: the state must amend Pathways to expand licensing to all child care settings to better meet families’ needs and increase subsidy reimbursements that amount to a fair living wage for providers. If not, unlicensed childcare arrangements will proliferate, possibly putting our most vulnerable North Carolinians at increased risk.
The Pathways plan includes four new non-negotiable requirements: the first calls for lower provider-to-child ratios, the second requires enhancements of classroom materials and equipment; the third is professional development for staff and improvements to the facility/program; the fourth calls for programs to schedule time for staff to build relationships with families enrolled. The plan also offers various levels of accreditation from local to national. Fulfilling all these requirements will earn childcare providers anywhere from a two- to a five-star rating.
But these requirements increase workload, staffing costs, materials and operational costs – all without any additional funding. Against this backdrop, “Pathways to the Stars” is not being received as an effort to promote higher-quality child care, but as an undue burden. Instead of adding new barriers, North Carolina should follow the example of states like Virginia, which implemented a system that includes Friends, Family & Neighbor (FFN) care. This strategy expanded affordability, provided care in a variety of settings (some without need for licensing), and increased the number of children served by public funding by 25% in FY23 – 24.
In contrast, North Carolina is moving in the opposite direction. In 2023, hundreds of educators, families, and advocates went to the General Assembly to tell their stories of navigating a broken child care system and providers submitted 120 letters to the state’s Child Care Commission opposing the plan. The writing was on the wall then, and the prospect of closures has proven to be true. The state has lost nearly 300 child care programs since 2024, continuing the downward spiral since the pandemic.
It is a common practice for states to leverage accreditation to incentivize subsidy reimbursement. In that regard, North Carolina is no exception. However, only 15 to 17 percent of eligible families receive subsidies. The greater focus should be on expanding options to reach the up to 85 percent of eligible children not being served. Some home-based providers have chosen to drop down to a 1-star level to avoid the stringent requirements. It is safe to say the level of care they will provide is far superior to that rating. These are business owners who have endured multiple overlapping crises, and have made a calculated decision to survive. This is a burnout response. And families are increasingly turning to unregulated child care out of desperation and necessity.
To be sure, state agencies should regulate child care to ensure quality, health, and safety standards. But when the system continues to demand more while giving less, subcultures will arise, giving way to an invisible child care workforce with little oversight.
North Carolina must adopt a licensing system that would allow child care providers to be licensed with greater flexibility within differentiated levels of requirements. The state must provide more options for families who don’t qualify for state subsidies and are already navigating an unstable child care landscape. Not only would doing so bring underground providers out of the shadows, but it would also create healthier, safer standards across the board and restore families’ autonomy to choose child care without fear.