Our commonwealth needs to make further investments and improve policies for the children and families served in the early care and education system. Read below for updates and information about Pennsylvania-focused policy and advocacy.

A new report on Early Intervention and Behavioral Health Services is now Available!

PennAEYC and the Education Law Center-PA are proud to release a new report: "Strengthening Connections: Early Intervention and Behavioral Health Services for Infants and Toddlers in Pennsylvania." This report presents findings from a statewide project exploring how Pennsylvania’s Infant and Toddler Early Intervention program and behavioral health systems can effectively address the mental health needs of infants and toddlers. Through a combination of research, survey questions and focus groups, the project identified both systemic challenges and promising opportunities for cross-sector collaborations to achieve common goals.

State Budget for Fiscal Year 2026-27

The final FY 2026-2027 state budget provided the following funding in early childhood care and education:

Child Care: The budget provides $5 million in the newest early learning line item, Child Care Staff Recruitment and Retention, under the Department of Human Services’ budget. This recurring investment now totals $30 million and is for child care staff directly responsible for the care of children in licensed programs that have a child care subsidy agreement. The Child Care Assistance line item received a $1.129 million increase, while the Child Care Services line item was level-funded.

Pre-k: The budget provides an increase of $3.750 million for Pre-K Counts and $1.043 million increase for the Head Start Supplemental Assistance Program to increase provider rates to help bridge the gap between rising costs and persistent staffing shortages due to low wages.

Early Intervention: Funding for infant and toddler Early Intervention was decreased by $5.2 million in the Department of Human Services budget. The Department is using prior year funds to keep the program whole and maintain the rate increase provided in fiscal year 2025-26. Preschool Early Intervention in the Department of Education budget received an increase of $41.2 million.

You can read the Early Learning PA press release here.

Budget-Related Legislation

Each year, there are bills which pass along with the budget. Some provide guidance regarding how line items are implemented and others move agreed-upon policy goals forward. The following initiatives passed into law related to early care and education:

  • The Fiscal Code was amended to:
    • include new deadlines and maximum retention bonus amounts for the Child Care Staff Recruitment and Retention Program. The Department of Human Services will now have 60 days to approve or deny an application; prior they had 45 days. Retention bonus payments must be at least $540 per member of qualified staff; previously they had to be at least $450 per qualified staffer. Finally, providers will be required to pay retention bonuses within 45 days of receipt.
    • require the additional funds for Pre-K Counts to be used to increase the per student grant amount.
  • The School Code was amended to allow Intermediate Units to be eligible providers for the Pre-K Counts program. It also added a new requirement for full-time Pre-K Counts programs to provide instruction for 180 days or 900 hours during the school year or 450 hours for a half-day program. Previously, programs were required to meet the 180 day requirement.

New resource available on Infant/Toddler Early Intervention

We are excited to announce a new resource for early care and education providers and the families you serve about the Infant and Toddler Early Intervention program, which provides services to children who have or are at risk of developmental delays. 

This one-page handout includes valuable information on

  • Eligibility criteria and the enrollment process
  • Available services and how they can support child development
  • Contact information for referrals and questions 

Download the file in English here Infant and Toddler Early Intervention Handout and Spanish here Spanish Infant and Toddler Early Intervention Handout 

 

New Updated Report: Solving the Child Care Teacher Shortage Through State Recruitment and Retention Investments

Issued by PennAEYC and Start Strong PA the Solving the Child Care Teacher Shortage Through State Recruitment and Retention Investments (Updated Report 2025) report describes how other states are tackling the child care teacher shortage head-on by funding initiatives that help providers better recruit and retain their staff. These 18 states are directly investing in recruitment, retention and other wage impacting strategies to ensure that the supply of child care teachers can meet the demand and keep classrooms open for working families. Some of the states that have made additional investments in recruitment and retention programs also have a child care subsidy reimbursement rate at or above the 75th percentile. This 2025 update includes the states that have documented and shared their outcomes.

 

Building a Financially-Stable, High-Quality Child Care System for Pennsylvania’s Children and Families: Improving Subsidized Child Care Rate Setting

PennAEYC, in collaboration with Start Strong PA, released a policy brief that recommends that Pennsylvania conduct cost modeling to determine the true cost of child care and adopt an alternative payment methodology for child care subsidy. The price of child care is high and a burden for most families, while child care programs operate on razor-thin margins and child care teachers and staff are paid poverty level wages. The current system fails our families, the teachers and staff and program owners and directors. Parents can’t afford to pay more, providers can’t afford to be paid less and teachers can't afford to stick around. Determining the true cost of care is critical to addressing the underfunding in the child care system. Creating a cost estimation model will outline revenue and expenses to identify what it actually costs to meet certification standards, accounting for program variations, and additional costs related to high-quality child care and appropriate compensation for the workforce.

Read the full report here Improving Subsidized Child Care Rate Setting - 2-2023 Web

Improving Subsidized Child Care Rate Setting Presentation February 2023

Presentation Recording; Passcode: Z%ngF2T?

Cost Gap Charts ELRC Regions 1-3 May 2025

Cost Gap Charts ELRC Regions 4-7 May 2025

Cost Gap Charts ELRC Regions 8-11 May 2025

Cost Gap Charts ELRC Regions 12-15 May 2025

Cost Gap Charts ELRC Regions 16 -19 May 2025

 

Cost Estimation Modeling Guide

PennAEYC, in collaboration with Start Strong PA, released a cost estimation modeling guide to provide the steps that must be taken to conduct cost estimation modeling and develop an alternative payment methodology to implement a cost based approach to rate setting in a manner which can be approved by the federal government. The Administration must opt to set provider payment rates based on an alternative methodology using a cost estimation model. There are two primary inputs to developing a cost estimation model, expense and revenue data from child care providers and quality cost drivers. The cost estimation model process will result in a tool that Pennsylvania can use to understand the impact of child care program characteristics and policies on the cost of care. When a state knows the true cost of care, these data can be used both to reimburse programs for the cost of operations as well as to gain understanding of what level of additional funding might be necessary to adequately incentivize care for underserved populations. Upon completion of the cost estimation model, Pennsylvania would develop a new payment methodology based on the information collected, along with a plan to fund the gap between current subsidy rates and the cost of providing high-quality child care.

Read the full guide here Cost Estimation Modeling Guide

 

Recommendations for Infant and Toddler Contracts in Pennsylvania: A Model to Strengthen and Stabilize the Child Care System

PennAEYC, Children First, Trying Together and Pennsylvania Partnerships for Children released recommendations for Pennsylvania related to infant and toddler contracted slots to expand and improve the program. Pennsylvania is well poised to expand contracts for infants and toddlers based on the Infant and Contracted Slots Pilot and can serve as a model for strengthening and stabilizing the child care system. These recommendations highlight the policy goals for the expansion of contract-based slots for infants and toddlers and offers well-researched financing and monitoring recommendations to ensure accountability for the system and use of public dollars. Lastly, the recommendations include ways to strengthen equity in a contracts-based model to ensure funding reaches all Early Learning Resource Center regions.

Read the full report here Recommendations for Infant and Toddler Contracts in Pennsylvania: A Model to Strengthen and Stabilize the Child Care System

 

Statewide Advocacy Agenda to Improve Part C Early Intervention Services for Pennsylvania

PennAEYC and Pennsylvania Partnerships for Children released a comprehensive report, Statewide Advocacy Agenda to Improve Part C Early Intervention Services for Pennsylvania, which reviewed the data and current practices in Pennsylvania’s system. There are five core recommendations:

  • Serving all children who can benefit from Part C EI through outreach, referral, enrollment
  • Ensuring Part C EI services offer the quality needed to make a difference
  • Achieving equitable access in Part C EI
  • Addressing mental health needs of infants and toddlers in Part C EI
  • Partnering with Medicaid to improve Part C EI

Read the full report here Statewide Advocacy Agenda to Improve Part C Early Intervention Services for Pennsylvania - JUNE 2022 FINAL ONLINE