DC Cost Estimation Model

Cost Estimation for Determining Subsidy Rates

Washington, DC

Since 2015, to establish subsidy payment rates, Washington, DC, has been using an alternative methodology that was developed in collaboration with early childhood finance experts. The city’s flexible financial model incorporates a variety of assumptions and data inputs to calculate the estimated cost of delivering services at each level of the District’s Quality Rating and Improvement System (QRIS) in centers and home-based settings, and under a variety of operating scenarios.

Source: Child Care and Development Fund Plan for the District of Columbia (2021)

Connections to Key Early Learning Study at Harvard (ELS@H) Findings:

States and cities can and should use cost estimation models to better understand the true cost of providing high-quality, affordable early education and care. These models should, in turn, be used to set subsidy rates that support fair, living wages for educators and promote a sustainable business model for all types of early education settings. Research suggests there is a need for more accessible, affordable, and high-quality early education opportunities across the mixed-delivery system – and for better financial and professional supports for the educators who serve children and families each day; measuring and funding the true cost of care can help states and cities address these needs and achieve these goals.

Findings from the Early Learning Study at Harvard (ELS@H) show:

  • Families rely on a range of formal (e.g., Head Start, center-based care, public pre-K) and more informal (e.g., home-based, relative care) early education settings; when choosing a setting for their child, families balance many logistical constraints and personal preferences.
  • But for many families – and especially low- and middle-income families – early education choices remain tightly constrained due to issues of affordability and supply.
  • Early educators play a critical role in supporting the well-being of young children and families across setting types.
  • Yet their pay, benefits, and other professional supports are often inadequate in light of the job demands and their cost of living.
Learn More about ELS@H Findings

Learn more about Washington, DC

Context matters. Visit the Washington, DC profile page to learn more about its demographics, political landscape, early education programs, early education workforce, and funding sources and streams.

Visit the Washington, DC Profile Here
  • The state population is 671,803
  • The number of children age 0-4 is 40,759
  • The median family income among households with children is $108,492.00