NC’s budget invested millions more in the state childcare subsidy program. Here’s how to find out where those dollars will go

Editor’s note: New childcare subsidy rates will go into effect on Oct. 1. EdNC will update this article when the October expenditure report reflecting these changes is available.

When North Carolina lawmakers passed a state budget in early July 2026, it directed $97 million in additional recurring federal funds to raise the rates childcare providers receive through the state’s childcare subsidy program.

The investment also established the state’s first reimbursement floor and moves subsidy reimbursement, meaning childcare facilities will receive at least the statewide average rate for subsidized care. Without a floor, rates range widely from county to county.

Then, in August, Gov. Josh Stein signed a second technical corrections bill increasing the appropriations for childcare services by $60 million. In total, the childcare subsidy program received about $160 million in additional funding, bringing annual spending on subsidies to more that $650 million, according to the North Carolina Task Force on Child Care and Early Education’s meeting on Aug. 31.

“It is literally going to change lives,” said Candace Witherspoon, director of the Division of Child Development and Early Education (DCDEE), during that meeting. “Ninety-six percent of providers are going to see an increase in their reimbursement.”

The state’s first technical corrections bill adjusted the implementation date for childcare subsidy rate changes from July 1 to Oct. 1.

The $97 million and later $60 million in federal funds come from the Child Care and Development Fund (CCDF), a federal program authorized by Congress through the Child Care and Development Block Grant Act of 1990.

In North Carolina, the DCDEE’s Subsidy Services Section is responsible for “developing, implementing, and interpreting policy” for the state’s childcare subsidy program, according to the section’s website.

DCDEE publishes two sets of reports that track childcare subsidy funding in each of North Carolina’s 100 counties.

DCDEE’s Subsidy Funding Authorization webpage periodically reports how much childcare subsidy money DCDEE calculates and authorizes to each county.

On pages 256 and 257 of the state budget’s bill text, you can find the formula that DCDEE uses to calculate how much each county will receive in childcare funding.

DCDEE’s expenditure reports webpage details how much each county spent on childcare subsidies in a given month. There are reports available for each month by fiscal year (FY), dating back to FY 2010-11.

The most recently available expenditure report is from August 2026, but new reports should become available after DCDEE calculates and updates the childcare subsidy rate changes that are supposed to go into effect on Oct. 1. 

The First Five Years Fund explains more about the federal funding North Carolina receives for childcare in this fact sheet:

The Child Care & Development Block Grant (CCDBG) is the primary federal grant program, appropriated by Congress, that provides low-income families access to safe, quality child care while parents work or go to school. In states, territories, and tribal nations (collectively referred to as “states” in this resource) CCDBG is combined with mandatory funding through the Child Care Entitlement to States (CCES) and referred to as the Child Care and Development Fund (CCDF).

According to previous EdNC reporting, the increased subsidy rates and subsidy floor were the main asks this session from early childhood advocates and the North Carolina Task Force on Child Care and Early Education. 

You can find all of EdNC’s reporting on early childhood here.