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HB 1066

Child Care Stabilization and Affordability Act.

2025-2026 Session Introduced by Eric Ager and 44 co-sponsors

Expands and stabilizes NC child care by boosting subsidies, workforce support, and access through coordinated funding, innovative programs, and streamlined administration.

Passed 1st Reading
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Bill Summary · HB 1066

Summary of HB 1066 (North Carolina) – Child Care Stabilization and Affordability Act

Session: 2025 | Public bill | Sponsor: Rep. Helfrich

HB 1066 is a multi-part measure aimed at stabilizing and expanding access to affordable, high-quality child care in North Carolina. It combines adjustments to scholarship programs, investments in the child care workforce, streamlined administrative systems, and new or expanded programs to support providers, employers, and families. Key elements are organized below by part.

1) Opportunity Scholarship program adjustments and funding shifts

  • Purpose: Revisions to eligibility and funding for the Opportunity Scholarship Grant Fund Reserve, and related subsidies for nonpublic (private) schools, to reallocate funds toward child care supports.
  • Eligibility changes: Revises the “Eligible student” criteria for Opportunity Scholarships (public-school eligibility, parental income thresholds, prior enrollment status, etc.).
  • Funding and reserves: Sets phased appropriations for the Opportunity Scholarship Grant Fund Reserve through FY2032-2033, with large-scale annual allocations (e.g., $825 million starting 2032-2033). Includes targeted reductions in the Reserve to fund reduced waitlists for subsidized child care.
  • Child care waitlist funding: Redirects $150 million nonrecurring and $240 million recurring from the Reserve to reduce the subsidized child care waitlist (starting in 2026-2027).

2) Tri-Share Child Care Program (permanency and funding)

  • Establishes the Tri-Share Child Care Program as a public/private partnership to share child care costs among employers, eligible employees, and the State.
  • Implementation: Administered with up to three regional facilitator hubs (local partnerships) forming the program’s backbone; regional hubs are chosen across diverse regions, with one from Tier 1 counties.
  • Eligibility and operation: Regions determine eligibility criteria (employee income 185%-300% of FPL, employment with a participating employer, not currently subsidized for care). The cost-sharing formula requires equal contributions from employer, employee, and State.
  • Oversight: The North Carolina Partnership (in conjunction with DCDEE) coordinates enrollment, payments, licensing verification, and reporting. A third-party administrator may be used.
  • Funding: A total of $9 million recurring in 2026-2027, distributed evenly to regional hubs.

3) Reenacted Child Care Tax Credit

  • Reenacts the state child care credit (G.S. 105-153.10) with updated income thresholds and credit amounts by filing status. The credit is still partially refundable and scales with adjusted gross income.
  • Effective for tax years beginning on or after January 1, 2026.

4) Expanded Early Childhood Workforce Development

  • Establishes the North Carolina Community College Early Childhood Apprenticeship Grant Program (Section 115C-10.52) to expand registered apprenticeships in early childhood education.
  • Funding: $5 million recurring to support colleges, tuition assistance, wages, and alignment of coursework with credential requirements.
  • Reporting: Annual data on enrollment, completion, and retention presented to the legislature.

5) Streamlined administrative system for providers

  • Creates a Unified Child Care Administrative Portal to consolidate applications, licensing documents, and reporting across DCDEE, DPI, NC Partnership for Children, and Community Colleges.
  • Requires a DCDEE implementation report within 18 months.

6) Using public facilities for child care

  • Plan to repurpose underutilized school classrooms and campus spaces for licensed child care; prioritizes counties with limited capacity; requires a formal plan and reporting due by December 15, 2027.
  • Separate provisions explore on-site state employee child care facilities and public-private leasing opportunities.

7) Regulatory clarity for religious-sponsored child care

  • DCDEE to publish guidance on licensing pathways, religious exemptions, and health/safety requirements for faith-based child care programs; includes outreach to faith-based organizations.

8) Child care funding stabilization

  • Sets July 1, 2026 as the start for raising subsidy rates to the 75th percentile of market rates for 3- to 5-star facilities.
  • Allows county-specific adjustments if a county’s market rate exceeds the statewide rate due to small enrollments.
  • Creates a $205 million recurring fund in 2026-2027 to support market-rate increases and a defined floor for subsidy rates.
  • Establishes automatic annual rate adjustments starting July 1, 2027, linked to CPI-U (South Region) or the latest market-rate study, whichever is higher.

9) Child care workforce compensation and benefits

  • Expands the Child Care WAGE$ salary supplements program: $22.7 million nonrecurring in 2026-2027 and $36 million recurring in 2027-2028.
  • Establishes a state-supported Child Care Employer Health Coverage Pool (G.S. 110-90.3): state-run pool to help employers offer health coverage for child care workers, with employer and employee premium shares, rebates to participating employers, and reporting requirements.
  • Start-up and ongoing funding: $35 million recurring (2026-2027) for premium rebates; $2 million nonrecurring for admin/start-up.

Effective Date

  • General effective date: July 1, 2026, with various provisions taking effect in specific fiscal years or upon fund availability.

This bill represents a broad approach to making child care more affordable, expanding the workforce, simplifying provider operations, and leveraging public facilities and subsidies to reduce barriers for working families.

Compiled from official sources — confirm details with the bill’s official record.

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