LUFKIN, Texas (Texas Tribune) — Earlier this year, Texas made a major investment in its child care scholarship fund — $100 million, to be exact.
That money, state lawmakers hoped, would provide an additional 10,000 scholarships to needy families and cut down the number of children waiting for assistance.
That didn’t happen.
In fact, as the year draws to a close, the number of Texas families seeking assistance from the state to cover child care is on the rise. And the money meant to provide more scholarships is covering higher tuition costs, according to an analysis of a Texas Workforce Commission report by Texans Care for Children, a child care advocacy organization.
The scholarship fund provides tuition assistance to families across the state. About 150,000 families received a scholarship last year. The wait list before the 2025 legislative session was just shy of 95,000. It now sits at about 100,000. The scholarship must cover a certain percentage of tuition per state law. That amount must match or exceed 75% of what local providers charge based on a survey. So, as the tuition increases, so does the scholarship amount.
“On one hand, we're disappointed by that,” said David Feigen, the director of early learning policy with Texans Care for Children. “On the other hand, we're certainly relieved that the legislature provided the funding that we needed to avoid eliminating thousands of scholarships in the state.”
State Rep. Armando Walle, D-Houston, worked hand-in-hand with the Texas Workforce Commission, which manages the scholarship funds. Walle was frustrated when he read the analysis by Texans Care for Children.
“My intention in expending all this political capital was to help more families,” Walle said. “This is a learning experience. We had never put this kind of money into child care before.”
Without the $100 million, Texas would have had to cut funding to thousands of scholarships over the next two years as kids aged out of their programs and into the K-12 system, Feigen said. More children would have been added to the waitlist.
“The bottom line is that the Legislature's investment is allowing thousands of Texas parents to go to work and ensure their kids earn safe and high quality child care,” Feigen said. “But it's also a very stark reminder of how much more work we have to do.”
To help determine scholarship amounts, the Texas Workforce Commission asks some of the 13,000 child care providers in Texas how much it costs to run their businesses.
About 1,000 of them responded to the most recent survey. Costs increased by 9% between 2023 and 2024. The increase was caused by rising costs of food, supplies and payroll — payroll being the largest expense.
Latoya Mayberry, who runs Toya’s Precious Jewels Academy in the Permian Basin, has had to double her employees’ pay to compete with the oil and gas industry and local school districts.
When she first opened her child care business, she paid her employees $9 an hour. Now, her highest-paid employee earns $18.
“And that’s just not enough,” she said.
Mayberry’s center has received the highest quality rating from the state’s Rising Star program, which provides quality ratings to help families assess child care centers. To achieve this rating, her teachers have earned at least an associate's degree, which means more compensation. And they’re expected to have more staff per student than the state’s minimum standards.
The profit margins at child care centers are nearly nonexistent for most providers. This makes it incredibly difficult to get a facility started and keep it running, even in a state that is home to more than 7.5 million children, 1.9 million of whom were younger than 5 in 2024.
Child care deserts — areas where there aren’t enough child care providers for the children — exist statewide. Parents across the state, especially in rural areas, have to look long and hard to find quality child care providers. And even when they do, there’s a good chance that there are no seats available or they can’t afford tuition. Because child care access and costs vary by region, the state uses local workforce offices to run the scholarship program.
In Deep East Texas, Ty Cauthen, the executive director of the local workforce development board, said he was so grateful to see the influx of funding from the state. But that moment was bittersweet because he also learned the number of kids the state was expected to help was lowered.
The conversation around child care, he said, “needs to be a priority like drinking water every day is a priority.”
Cauthen’s colleagues have been busy finding additional grants and gifts to help offset the costs of higher tuition. Coupled with other factors, such as the start of school and children entering kindergarten, the Deep East Texas workforce development region has cut its waiting list from more than 1,000 children to less than 450 since June.
Disclosure: Texans Care for Children has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.
This article first appeared on The Texas Tribune.
