What Will 2026 Hold for Early Care and Education?

As 2025 comes to a close, it’s time to reflect on the first year of the second Trump administration and also think ahead to what 2026 could hold for early education. In a year marked by turbulence and unpredictability for both federal policy and the federal civil service, the good news is that many of the core federal early education programs are well-positioned to at least receive level funding for FY26.

Despite rumors in April that the administration was seriously considering a budget proposal that would zero out funding for Head Start, the president’s full budget proposes level funding for the program. It also calls for level funding for the Child Care and Development Block Grant (CCDBG). At the same time, many states, such as New Mexico, Connecticut, and New Jersey continue to make important progress towards increasing access to affordable, high-quality child care despite a lack of momentum at the federal level.

2025 also saw a full-scale attack on the Department of Education (ED) via mass layoffs and the use of interagency agreements to shift responsibility to other departments. There were also widespread staffing cuts at the Administration for Children & Families (ACF) at the Department of Health and Human Services (HHS). And while the president’s budget proposed level funding for Head Start and CCDBG, it also calls for the elimination of the Preschool Development Grant Birth Through Five (PDG B-5) program, the Child Care Access Means Parents in Schools (CCAMPIS) program, and funding for Title III - the only federal grant program specifically geared towards supporting English learners and recent immigrant students.

Additionally, the sweeping tax and spending bill signed into law by President Trump in July includes significant cuts to Medicaid and food assistance that will reverberate for years to come. Some states are already responding to this expected shortfall of federal funding by cutting pre-K funding, reducing reimbursement rates for providers, and increasing family co-pays. And the sweeping changes coming to Medicaid, higher education, and nutrition assistance as a result of the bill will likely have an outsized impact on the early education workforce as well.

Here are a few questions that rise to the top for our team when thinking about the next 12 months in early education:

How will states adjust their spending on early education in response to tighter budgets and federal cuts?

The massive tax and spending bill signed into law by President Trump in July means significant changes for higher education, health care, tax law, and state budgets. It includes the largest federal funding cut in Medicaid’s history as well as dramatic changes to the Supplemental Nutrition Assistance Program (SNAP). While most Medicaid spending reductions will be achieved via stricter eligibility requirements, every state is likely to see a reduction in federal Medicaid funding over the next ten years ranging from 4 to 19 percent. Additionally, SNAP costs are expected to rise sharply for states, with the average state spending two to three times more of their budget on the program.

We’re already starting to see the impacts of these fiscal pressures on states. Some states, such as Maryland, have stopped enrolling new families into their child care subsidy programs. Others, including Indiana and Arkansas, have announced cuts to reimbursement rates for providers who serve families relying on child care subsidies. Several states have also raised copays for families already enrolled in child care assistance programs. With many of the bill’s spending cuts not taking effect until after the November midterm elections, we’re likely to see more changes such as these throughout 2026 as states begin to adjust to their new financial reality.

What is the future of Head Start?

Head Start supporters breathed a sigh of relief in May when the president’s budget proposal was released without any mention of eliminating funding for the sixty-year-old program. The full budget proposal calls for level funding for the program, though a third straight year of level funding amounts to a cut when inflation and rising costs are taken into account. In 2025 the program also experienced the abrupt closure of five of the ten regional offices that assist local grantees, the termination of about 100 Office of Head Start central office staff, and ongoing delays in payments and grant renewals.

2026 should provide some clarity about the impact of these changes on local grantees as well as the funding picture for Head Start. In July, Senate appropriators proposed an $85 million increase compared to FY25 while House appropriators proposed level funding. With a government funding deadline of January 30 looming, it shouldn’t be too long into the year before we gain a better picture of Head Start’s funding situation. Other Head Start-related items to keep an eye on in 2026 include the now-delayed plan to restrict access to the program to U.S. citizens as well as a forthcoming proposed rule aiming to roll back a Biden-era rule designed to improve the wages and benefits of Head Start staff.

What is the future of PDG B-5 and CCAMPIS?

Both the PDG B-5 and CCAMPIS programs were targeted for elimination in the president’s budget that was unveiled in May. Since then, House appropriators have gone along with the president’s request and proposed zeroing out funding for the programs while their Senate counterparts have level funded both programs ($315 million for PDG B-5 and $75 million for CCAMPIS). More recently, the administration announced plans to transfer CCAMPIS from ED to HHS as part of its continued assault on ED.

PDG B-5 is the only federal funding stream dedicated to building state-level capacity across the various programs that make up the country’s early care and education landscape. Despite the administration’s claims that PDG B-5 funds are being used to “push DEI policies on to toddlers,” the truth is that these grants have been instrumental in enabling states to improve their ECE systems. States have used these funds to strengthen the transition between early childhood and the early elementary school grades, increase program operating and cost efficiencies, and encourage alignment and quality across the mixed delivery system of child care providers, Head Start, state pre-K, and more. Governors from both sides of the aisle have praised the program as being critical to improving their early care and education systems.

CCAMPIS is the only federal program that helps student parents with low incomes access child care while pursuing higher education. In FY23, 264 colleges received an average of about $317,000 to support or establish campus-based child care programs. With nearly one in five undergraduate students raising children, a lack of affordable child care is a real barrier to college completion and eliminating CCAMPIS would make the process even more difficult for many parenting students.

What changes are coming to the rules and regulations governing the Child Care and Development Fund (CCDF)?

In March 2024, HHS issued a final rule regarding regulatory changes to CCDF, the main federal funding source for helping about 1.5 million children in families with low incomes afford child care. The rule requires states to make several changes, including capping family copayments at seven percent of household income for subsidy-eligible families, implementing certain payment practices to improve provider financial stability, and providing some services through grants and contracts to increase child care supply in underserved areas.

Several states have recently made legislative changes to comply with parts of the rule, but the Trump administration has announced plans to eventually do away with the rule. Since the rule sparked many of the recent positive changes in child care policy in states across the country, it will be interesting to see how states respond in the coming year if the rule is eventually repealed.

What is the future of early intervention and early childhood special education?

Although the president suggested in March 2025 that oversight of the Individuals with Disabilities Education Act (IDEA) could be moved to HHS, no such change has occurred as of this writing. IDEA is federal law, and Congress would need to amend the statute to transfer oversight. It is likely that if IDEA oversight shifts to HHS, it will be done through an interagency partnership between ED and HHS. This potential change raises concerns among disability advocates.

The Trump administration closed seven of ED’s 12 Office for Civil Rights (OCR) regional offices, and many OCR staff positions have been eliminated. The OCR is often a family’s key avenue for filing complaints when they believe schools have violated civil rights laws based on disability, race, gender, and other characteristics. Staffing at OCR remains reduced and could weaken civil rights enforcement and guidance to states and districts. OCR has approximately 25,000 pending complaints and about 7,000 open investigations.

Medicaid cuts add further risk since Medicaid is the third-largest funder of early intervention and the fourth-largest funder of school-based services, covering more than half of children receiving special education and related services. These changes raise concerns about access to essential services for young children with disabilities.

What cities and states will lead the way with innovations that improve the availability and quality of early care and education?

Despite the challenges at the federal level in 2025, many states and cities made important progress towards increasing access to affordable, high-quality early care and education. A growing number of states and cities are establishing dedicated funding streams that can be protected from year-to-year budgetary pressures. New Mexico became the first state to offer free child care to families regardless of income. Connecticut committed $300 million in general fund surplus to fund a new endowment dedicated to early care and education. And a new mayor was elected in New York City on promises to deliver universal, free child care. We look forward to seeing which states and cities continue to lead the way in 2026.