Thanks to the consistent advocacy of the NC Chamber, coupled with the informed research of the NC Chamber Foundation, significant new regulatory reforms that directly impact the efficiency, quality, and sustainability of the North Carolina child care infrastructure passed this week.

House Bill 412: Child Care Regulatory Reforms passed with nearly unanimous support thanks to the business community’s leadership. It currently awaits the signature of Governor Josh Stein to become law. Let’s unpack the details.

Boosting Efficiency, Reducing Red Tape

Imagine a scenario where essential support for working families operates with greater ease and less administrative burden. That’s precisely what these new reforms achieve.

Child care programs utilizing spaces already approved for school use will now automatically meet core safety standards for space, equipment, sanitation, fire, and building codes. This intelligent streamlining reduces redundant inspections and approvals, allowing providers to focus more resources on program delivery and less on bureaucratic hurdles.

Furthermore, these updates bring clarity and flexibility:

• Targeted Standards: School-based standards are now appropriately clarified; they won’t apply to the school-age children of facility operators, while still ensuring robust safety for preschoolers.
• Expanded Reach: Programs can now voluntarily offer care for children aged 13 or older, expanding options for families with a wider age range of children.
• Commonsense Facility Approvals: Detailed guidelines for indoor and outdoor spaces, including exemptions for certain public school facilities and recognition of existing playgrounds, demonstrate a pragmatic approach to licensure. This avoids unnecessary costs and delays for facilities already fit for purpose.

Investing in a Skilled and Stable Child Care Workforce

A stable and qualified child care workforce is essential for your employees’ peace of mind and productivity. These reforms actively support the professionalization and availability of child care staff:

• Optimized Staffing Ratios: Adjustments to staff-to-child ratios and group sizes for infants and toddlers provide flexibility, including options for increased group sizes when higher staffing standards are met. This allows for efficient resource allocation while maintaining quality.
• Accessible Qualification Pathways: Recognizing that talent comes from diverse backgrounds, new qualification pathways now include alternative credentialing based on valuable work experience. This broadens the pool of qualified professionals.
• Specialized Training & Recognition: The state will establish new education recognition categories and develop a specialized credential specifically for school-age and out-of-school care, fostering a highly competent workforce tailored to these programs.
• Valuing Continuing Education: Community college continuing education is now recognized equivalently to curriculum courses for credentialing purposes, promoting ongoing professional development and skill enhancement within the sector.
• Quality Assurance: The inclusion of the Weikart Youth Program Quality Assessment provides a research-backed tool for evaluating and improving the quality of out-of-school programs, ensuring a high standard of care for children.

Addressing Business Risks: A Proactive Approach to Liability

Perhaps one of the most significant developments for the sustainability of child care providers, and by extension, the stability of your workforce, is the directive for a workgroup led by the Department of Insurance. This group will explore the feasibility of group liability insurance plans for child care providers and other entities serving minors through public programs.

This initiative is a proactive step to:

• Reduce Operational Costs: Group insurance models can significantly lower individual premiums for providers, freeing up resources that can be reinvested in staff compensation, facility improvements, or expanding capacity.
• Stabilize the Industry: By mitigating liability risks, these plans can help ensure the long-term viability of child care businesses, reducing closures and the resulting disruption for working parents.
• Foster Economic Growth: A robust and accessible child care infrastructure directly correlates with increased workforce participation, particularly among women, and higher employee productivity. By addressing insurance challenges, we remove a critical barrier to growth in this essential sector.

The workgroup, comprising key stakeholders from state agencies, the insurance industry, and child care associations, will evaluate potential models and recommend reforms to reduce premiums and consider tort reforms to limit liability damages. Their findings are due by January 1, 2026.

Immediate Impact for a Stronger Future

All these vital changes are effective immediately upon becoming law. This legislative action represents a strategic investment in the foundational support systems that enable our workforce to thrive.

As we look to strengthen our economy and talent pipeline, the vitality of our child care programs is a critical, often overlooked, component. We have been proud to champion these significant new regulatory reforms that directly impact the efficiency, quality, and sustainability of these programs – ultimately benefiting your workforce and the broader business landscape.