Overview

There is a growing interest by the Federal Health and Human Services as well as states in using contracts as a better mechanism by which to distribute funds to providers. Contracts are a funding mechanism that allows states to provide targeted funding towards specific goals, such as improving quality, increasing supply, or supporting the workforce. During the pandemic, many states successfully used COVID-19 relief funds to provide targeted support to the ECEC workforce and to stabilize their child care systems. To this date, states continue to see the value in grants and contracts as a way to move beyond per-child funding strategies and build early learning infrastructure and quality.