A Bill for an Act
Page 1, Line 101Concerning requirements for child care centers owned by an
Page 1, Line 102institutional investment entity.
Bill Summary
(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)
The bill requires a child care center owned by an institutional investment entity to meet the following requirements in order to receive state funding:
- The child care center may only charge a wait list fee of no more than $25; and
- The child care center shall post and update accurate child care pricing on the child care center's website.
- Allow a child care center to maintain ownership of the property used to operate the child care center; and
- Upon acquisition of a child care center, provide at least a 60-day notice to all child care center employees and families with children enrolled at the child care center if the institutional investment entity intends to lay off child care center employees or change enrollment or eligibility requirements for the child care center.
The bill requires an institutional investment entity to meet the following requirements in order to receive state funding:
The requirements of the bill apply only to institutional investment entities that own 5 or more child care centers and to child care centers that are owned by an institutional investment entity that owns 5 or more child care centers.
This Unofficial Version Includes Committee
Amendments Not Yet Adopted on Second Reading
Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:
Page 2, Line 2SECTION 1. Legislative declaration. (1) The general assembly
Page 2, Line 3finds that:
Page 2, Line 4(a) Colorado families need and deserve an abundance of
Page 2, Line 5high-quality, affordable child care options, and such a system benefits
Page 2, Line 6Colorado children, parents, communities, businesses, and the state
Page 2, Line 7economy;
Page 2, Line 8(b) Large for-profit child care center chains backed by
Page 2, Line 9institutional investors have been proliferating in Colorado, and these child
Page 2, Line 10care center chains have a profit maximization motive distinct from
Page 2, Line 11nonprofit, community-based, or small noninstitutional investor-backed
Page 2, Line 12for-profit child care programs;
Page 2, Line 13(c) Child care center chains have, at times, engaged in
Page 2, Line 14profit-driven actions contrary to the best interests of staff, enrolled
Page 2, Line 15families, and the health of Colorado's overall child care system. These
Page 2, Line 16actions include targeted or sudden closures of child care sites and real
Page 2, Line 17estate transactions that harm the financial position of child care sites.
Page 3, Line 1(d) As more public funding becomes available to support
Page 3, Line 2Colorado's child care system, expansion of child care center chains is
Page 3, Line 3likely and may result in the capture of public dollars for the private gain
Page 3, Line 4of investors;
Page 3, Line 5(e) The government has long taken an active role in establishing
Page 3, Line 6guardrails against profit-maximizing behavior by private businesses,
Page 3, Line 7particularly those in which there is a strong public interest, such as private
Page 3, Line 8educational institutions, hospitals, banks, and airlines;
Page 3, Line 9(2) Therefore, the general assembly declares that it is necessary to:
Page 3, Line 10(a) Define large for-profit, institutionally backed child care center
Page 3, Line 11chains as a distinct class of child care program; and
Page 3, Line 12(b) Establish guardrails that mitigate profit-maximizing behavior
Page 3, Line 13in child care, including preventing child care center chains from:
Page 3, Line 14(I) Levying excessive ancillary fees, such as wait list fees;
Page 3, Line 15(II) Not being transparent about the full price of services;
Page 3, Line 16(III) Forcing sale-leaseback arrangements that enrich investors,
Page 3, Line 17leaving child care sites with unnecessary debt; and
Page 3, Line 18(IV) Conducting mass layoffs or site closures without reasonable
Page 3, Line 19notice to staff and enrolled families.
Page 3, Line 20SECTION 2. In Colorado Revised Statutes, add 26.5-1-118 as
Page 3, Line 21follows:
Page 3, Line 2326.5-1-118. Private equity acquisition of child care centers -
Page 3, Line 24applicability - definition. (1) As used in this section, unless the
Page 3, Line 25context otherwise requires, "child care center" means a child
Page 3, Line 26care center, as defined in section 26.5-5-303, or a substitute
Page 3, Line 27placement agency, as defined in section 26.5-5-303.
Page 4, Line 1(2) For transparency and accountability to families, a
Page 4, Line 2child care center must provide a fee schedule to families upon:
Page 4, Line 3(a) Joining a wait list;
Page 4, Line 4(b) Registration;
Page 4, Line 5(c) Request of the family; or
Page 4, Line 6(d) Changes to the fee schedule.
Page 4, Line 7(3) Upon acquisition of a child care center, the purchasing
Page 4, Line 8entity must provide at least a sixty-day notice to child care
Page 4, Line 9center employees and families who have children enrolled at
Page 4, Line 10the child care center if the purchasing entity intends to lay off
Page 4, Line 11child care center employees or change enrollment or eligibility
Page 4, Line 12requirements for the child care center as a result of the
Page 4, Line 13purchasing entity's acquisition.
Page 4, Line 14SECTION 3. Effective date. This act takes effect upon passage;
Page 4, Line 15except that section 26.5-1-118 (2), Colorado Revised Statutes, as enacted
Page 4, Line 16in section 2 of this act, takes effect only if Senate Bill 25-004 becomes
Page 4, Line 17law, in which case section 26.5-1-118 (2) takes effect on the effective
Page 4, Line 18date of this act or Senate Bill 25-004, whichever is later.
Page 4, Line 19SECTION 4. Safety clause. The general assembly finds,
Page 4, Line 20determines, and declares that this act is necessary for the immediate
Page 4, Line 21preservation of the public peace, health, or safety or for appropriations for
Page 4, Line 22the support and maintenance of the departments of the state and state
Page 4, Line 23institutions.