May 20, 2026

Response to the May Revise

"Child Care is infrastructure. It is something that unlocks the economy. It is one of the few things in the state budget that you can point to that affects and helps virtually everything." - Assemblymember Patrick Ahrens

SAN FRANCISCO, CA (May 19, 2026) - Last week Governor Newsom released a revised state budget proposal, also known as the May Revision or May Revise. This proposal boasts historic investments in TK-12 education and significantly higher revenues than assumed in January, while creating a path to achieve a balanced budget in both FY2026-27 and FY2027-28. However, the proposal does little to support the backbone of our economy: child care providers and the families, children, and businesses who rely on them.

The May Revise proposes the following for Early Care and Education (ECE):

Reducing Overall Child Care Funding

  • Reduces funding for CDSS child care programs by approximately $61.2 million ongoing.

Abandoning Prospective Pay

  • Removes funding to support administrative changes to pay providers prospectively due to a recent federal rule change. Learn more here.

Reducing Child Care Spaces

  • Reduces ongoing child care funding by 6,798 slots which includes a reduction of $69.3 million in California Alternative Payment Program funding and $2.3 million in General Child Care Program funding.

Reducing Child Care COLAs

  • Includes a 30% reduction to the revised 2026-27 cost-of-living adjustment (COLA), resulting in a 2.01 percent COLA for DSS administered child care programs, including CACFP and R&Rs.

Altering Alternative Payment Program Funding

  • Increases the allowable in-contract administration costs of Alternative Payment Programs by 1.5 percent and eliminates the prior $70 million AP admin rate add-on.

Increasing Disaster Recovery Funding

  • Includes a one-time increase of $28 million in federal funds for child care facilities affected by the 2021 and 2024 natural disasters.

  • Includes an additional $308 million in Prop 64 funds, in addition to the Governor’s January budget proposal for $11.5 million in Prop 64 funds for disasters in 2025.

Increasing CAlWorks Maximum Aid Payment

  • Includes a 1.8% increase to CalWORKS Maximum Aid Payment levels (effective October 1, 2026), which is estimated to cost $59.5 million in 2026-27.

Increasing Investments in QRIS

  • Includes a $20 million increase in ongoing Proposition 98 General Funds for the state’s QRIS system.

While we appreciate the importance of a balanced budget, the May Revise ultimately fails to make any significant progress toward strengthening or expanding our vital child care infrastructure.

“Child care providers are still struggling to stay in business and families are still struggling to find and afford child care. While this budget does include some measures that will support our communities such as increased disaster aid, it’s far from what child care providers and families need in California. This proposal ultimately backslides on key promises to increase subsidized child care spaces and pay providers based on enrollment. Child care providers cannot continue to operate on thin margins - we need to pay providers equitable wages and we need to ensure that parents receive child care when they need it. We also need to create a well funded infrastructure that supports both of them." - Kelly Graesch, Interim Executive Director

Child care is a basic need. We urge the Governor and Legislature to support families and providers by:

  • Funding the Governor's promise to add 200k new child care spaces by 2028.

  • Paying child care providers equitable wages that reflect the true cost of care.

  • Backfilling nearly $90m in federal CCDF reductions, including $10m for Quality Improvement Programs which fund local child care resource and referral agencies and the Child Care Initiative Project (CCIP).

Our state’s strength comes from its people and its communities. As we collectively face the impacts of H.R.1 which threaten millions of people's access to basic needs like health care and nutrition, our state cannot continue to operate under the status quo. Parents and providers rely on a patchwork of social services including child care in order to survive and support their families. However, rising costs of living and continued underfunding creates the perfect storm that leaves families struggling to afford child care and leaves providers unable to keep their doors open. As the fourth largest economy in the world, we call on the Governor and Legislature to put our children and families first by investing in the programs and services that help families thrive.

The Network remains steadfast in its commitment to work alongside our dedicated members and partners to continue advocating boldly for policies and budgets that meet our families’ needs.


In Partnership,

Kelly Graesch
Interim Executive Director