Child care can be a challenge for all working parents. Parents with older children who are beyond the stage of needing child care may recall with a shudder the juggle they managed between high quality, consistent care and their jobs.

Historically, low-income families that needed child care for their children 0-12 years could apply for support as long as the parents were working or looking for work, or pursuing job training or an education. Last year, that program, the Colorado Child Care Assistance Program (CCCAP), served over 30,000 kids. And while CCCAP serves only about 10% of income-eligible families, it was impactful for those who received the assistance.

But now, for low-income working parents, there is an added burden. Families that didn’t already have child care assistance by the beginning of 2025 are unlikely to get it — maybe for as long as three to five years.

A new federal rule, Improving Child Care Access, Affordability, and Stability, was enacted in March 2024 under the Biden administration and is slated to go into full effect across the U.S. in August 2026.

The new rules could be helpful to low-income families as well as child care providers that accept CCCAP payments — if only it were funded.

The changes include capping a family’s contributions to child care at 7% of their household income, regardless of the number of children. The 7% threshold is the amount the U.S. Department of Health and Human Services (HHS) has determined a family should not exceed for child care to be considered affordable.

In Colorado, families can pay up to 25-30% of their income on child care, making Colorado one of the most expensive child care states in the U.S. If CCCAP parents were limited to paying no more than 7% of their incomes on child care, this would go a long way toward making child care affordable and encouraging parents to stay in the workforce or complete their education and training — key factors in improving their long-term income potential.

Child care centers will also benefit from these new rules because they will be paid for enrollment rather than attendance, allowing them to afford staff even when a child is out sick or otherwise unable to attend. The rule also allows providers to be paid in advance of providing services.

The challenge with the new rule is that, while it would make child care more affordable for families and better for the 2,462 child care providers across the state, it is not accompanied by additional federal funding. In Colorado, child care assistance is funded with a mixture of federal, state, and county dollars, with the federal funding constituting the majority—72% of the total in state fiscal year 2024-25. It is estimated that funding these new requirements would cost an additional $70 million per year.

Many counties—24 as of September 2025—are left with no choice but to freeze new enrollments or create waitlists for new applications for CCCAP for the foreseeable future (the projection is these freezes may last three to five years or even up to 10). The 24 counties across the state that have either frozen enrollments or created waitlists have left 10,938 children on waitlists or freezes. These freezes/waitlists mean that any newborn children will be unable to access care for the foreseeable future and the state expects the number of children who are served by CCCAP to drop from 30,000 to 10,000.

Our child care and educational systems are built on an old paradigm that says one parent stays home with young children while the other parent works. However, in Colorado households with children from 0-6 years, 65% of all parents in the household work. This means that many families — not just low-income families — must find some form of child care for their young children. If low-income families are unable to afford care without assistance, parents risk being left with little choice but to leave the workforce. If just 20% of the low-income parents needing child care assistance left the workforce, the GDP impact on the state would be a loss of $1.1 billion by 2029.

Statewide, Colorado struggles with child care affordability and accessibility. In a CSI report published earlier this year, we plotted affordability and accessibility for all 64 counties, showing that no county in the state was both affordable and accessible. Yet, it is clear there are wide variations between counties, leading one to understand that the solutions to addressing child care challenges must also be varied and take location into account.

In the meantime, low-income parents in Colorado would benefit from their communities coming together to try and solve the problem holistically. For instance, how might the state, local municipalities, and businesses work together to create solutions that make sense for them?

Child care is a system that affects us all. As such, I believe the solutions to improving both access and affordability must include a multi-sector approach. When parents leave the workforce, employers can have a harder time filling jobs, parents forego benefits that are tied to employment such as health care and retirement savings, and communities lose the boosts to their local economies that come from residents spending money. If we can address the cost and availability of child care through a diverse approach, families can thrive and when families thrive, our communities thrive.

Tamra Ryan is the Coors Economic Mobility Fellow for the Common Sense Institute.