Built to Last: How Leaders Are Creating Sustainable Early Childhood Funding

High-quality early childhood education supports children’s healthy development and family well-being, yet funding remains fragmented and insufficient. States and communities are increasingly pursuing dedicated funding streams to create stable, long-term investments that better align with family and provider needs. But dedicated funding is only the beginning. Leaders in Connecticut and Kent County, Michigan emphasize that sustaining it requires stewardship, relationships and coalitions, and transparency—with families, advocates, and political champions—throughout implementation.

What Does the Research Say?

Strong early education systems should offer high-quality by design, with coordinated investments that support diverse program types rather than a single model. Fragmented, short-term funding structures leave programs under persistent financial pressure, while the cost of care remains out of reach for many families, particularly those without access to subsidies or other support. Dedicated funding streams offer a more stable foundation—one that better aligns public investment with how families actually use care, and with the operational realities facing providers.

Turning Budget Surpluses into Lasting Investment: Connecticut’s Early Childhood Education Endowment

Early childhood funding in Connecticut was fragmented across state agencies, limiting coordination and leaving significant gaps in access—particularly for infants, toddlers, and underserved communities. In 2023, Governor Ned Lamont convened a Blue Ribbon Panel on Child Care, bringing together philanthropists, providers, businesses, families, and advocates. The panel’s work led to Connecticut’s Early Childhood Education Endowment. The endowment is funded through Connecticut’s budget surplus: unbudgeted dollars are deposited into the fund each year and generate revenue through investment. The endowment launched in 2025 with a deposit of $300 million; because only a fixed percentage of the fund can be spent each year, approximately $36 million was available in its first year to expand child care access, improve quality, and support the workforce. In June 2026, the state deposited an additional $320 million into the endowment, bringing the total to $620 million and positioning Connecticut to begin offering no-cost or reduced-cost child care to eligible families as early as July 2027.

How Leaders Made It Happen

Kept the full system in view. Leaders resisted pressure to focus only on preschool, ensuring that infants, toddlers, and the mixed-delivery system were included from the start. As one leader noted: “We knew, as an agency…you can’t bifurcate infants and toddlers out of whatever this expansion proposal is going to look like, because we’ve learned from other states…that it just doesn’t work.”¹ The endowment requires that at least 35 percent of new spaces serve infants and toddlers.

Built political and cross-sector support. As one leader put it: “Relationships matter, and trust is key. Without those two things, it’s really very, very difficult to move anything forward.”² Leaders were committed to showing that community input guided the design at each stage—especially parents’ perspectives. To sustain parent input, they established a parent cabinet, an advisory board to the Office of Early Childhood.

Embedded legislative leadership in endowment governance. The endowment’s advisory board is chaired cooperatively by one state representative, one state senator, and the commissioner of early childhood, giving the legislature a direct stake in implementation. Agency leaders meet regularly with the three chairs, which keeps them involved in planning and spending decisions so they remain invested advocates rather than passive overseers.

Realized the need for strong data systems. Lacking reliable data on family incomes and fees, leaders used census data and supply-and-demand assumptions. They later discovered that nearly 90 percent of families they were serving fell below the $100,000 income threshold for free care—creating a gap of roughly $60 million between initial projections and actual costs. Connecticut has updated its reporting systems to collect the data directly.

Communicated transparently as public demand outpaced capacity. With families and providers awaiting promised benefits, the department held statewide listening sessions to explain the endowment and why expansion takes time. Parent cabinet members also communicated directly with families: ““A lot of times people don’t trust state agencies…they want to hear directly from parents, from people that they trust.”³

Early Childhood on the Ballot: Kent County’s Ready by Five Millage

In Kent County, Michigan—home to the city of Grand Rapids and 660,000 residents—a 2017-2018 gap analysis found that roughly half of children under five came from economically disadvantaged communities with significant shortfalls in access to health and early learning. In 2018, county voters approved the Ready by Five Early Childhood Millage, a 0.25 mill property tax levy—$62.50 per year for a home valued at $250,000—dedicated to early childhood services across four areas: early education, parent support, healthy development, and outreach and navigation. Voters renewed the millage for another six years in 2024.

How Leaders Made It Happen

Built broad-based support before going to the ballot. Leaders laid careful groundwork before pursuing a ballot measure, engaging a bipartisan group of prominent community figures who could raise campaign funds and use their personal standing with county commissioners to build the support needed to get the measure on the ballot. As one leader put it: “This is not a sprint. You need to make sure that you have developed the relationships that you need in your community that are whispering in the ears of your county commission.”⁴ 

Designed for flexibility and accountability. The millage was structured to adapt to changing conditions. When programs were disrupted by COVID and did not receive millage revenue, funds were redistributed rather than lost, and backlogged dollars were later deployed into the community at a larger scale. As one leader noted, “the policy and the millage were designed so that it could pivot if it needed to.”⁵ 

Embedded equity in funding design and measurement. From the start, leaders designated “opportunity zip codes”—areas identified in the gap analysis as having the greatest need—and required organizations applying for funding to specify how they would serve those communities. Data-sharing agreements with funded partners allow First Steps Kent to track reach and impact. By the renewal campaign, leaders were able to show millage-funded programs had served children and families in every zip code in the county.

Demonstrated return on investment. When anti-tax sentiment surfaced during the renewal campaign, leaders showed that Ready by Five-funded programs returned $3 to $12 for every dollar invested and pointed to national recognition of some of those programs. Data also showed statistically significant kindergarten readiness gains for multilingual learners who participated in Ready by Five-funded programs.

What These Stories Tell Us and a Glimpse at Other Examples

A few patterns stand out across these examples:

• Leaders built coalitions and secured political champions before pursuing formal policy, embedding those relationships in governance structures. 
• From the start, both cases built specific criteria into the funding structure—Connecticut’s 35 percent infant and toddler requirement, Kent County’s opportunity zip codes—ensuring that resources reached the communities they were meant to serve.
• Data proved essential in both cases, but the lessons were different. Kent County’s outcome data was central to winning renewal. Connecticut learned the cost of data gaps firsthand: without reliable income data, initial projections fell $60 million short, ultimately leading to better reporting systems.
• Both cases required sustained, transparent communication, though in different ways. Kent County’s renewal succeeded by demonstrating results. Connecticut must manage expectations when the endowment takes time to build and economic conditions create uncertainty around annual allocations.

Other Promising Approaches

Building endowments for long-term stability. New Mexico’s Early Childhood Education and Care Fund uses oil and gas revenues to generate sustained funding through investment earnings.

Using ballot measures to catalyze large-scale investment. In San Antonio, voters approved a sales tax to fund Pre-K 4 SA, creating a stable local revenue stream for early learning. In Anchorage, Alaska, voters approved dedicating existing marijuana sales tax revenue to child care and early education. In San Francisco, a ballot measure established a commercial rent tax generating approximately $146 million annually for early care and education. In Oakland, California, voters approved a 30-year parcel tax with a goal of universal preschool for 3- and 4-year-olds. Voters in Alameda County, California, also approved a 0.5 percent sales tax in 2020 that will generate about $150 million each year for expanding access to early education, including one-time emergency grants to providers and the implementation of a wage floor of $25/hour for early educators.

Using voter-approved levies to unlock state matching funds. In New Orleans, Louisiana, voters approved a 5 mill property tax levy in 2022 to fund early childhood education for 2,000 children from low-income households annually, raising $21 million in the first year—an amount doubled by state matching funds.

Cross-Cutting Implementation Challenges

Dedicated funding streams don’t automatically strengthen early childhood systems. Common friction points include:

• Sustaining support — Political and public will can shift when funding must be renewed or competes with other priorities
• Volatility — Funding tied to economic conditions can fluctuate, affecting pace, scale, and reliability of implementation
• Governance complexity — Balancing accountability with speed requires clear structures that don’t slow decision-making
• Reaching intended populations — Misaligned program structures or insufficient targeting criteria can mean funds bypass the families and communities they were meant to serve
• Demonstrating impact — Leaders must show results that resonate with policymakers, voters, and stakeholders
• Capacity gaps — Expanding funding without aligned investments in workforce, data systems, and infrastructure limits efficacy

Measures of Progress

Consider tracking:

• Total funding generated and allocated over time
• Distribution of funds across target populations and geographies
• Access to early childhood programs, including for infants and toddlers
• Family participation in governance and decision-making
• Child and family outcomes, including kindergarten readiness
• Return on investment and broader economic impact
• Workforce capacity and stability

Tools for Action

• Toolkit for translating this brief’s findings into concrete next steps
• Questions to guide your work
• Zaentz Navigator—a user-friendly, interactive digital tool that helps policymakers, advocates, and leaders explore how cities and states across the country are tackling challenges related to early education