Jenna Conway, deputy superintendent for early childhood care and education at the Virginia Department of Education, told the House Appropriations Committee the governor’s proposed budget and four policy levers recommended by the Commission on Early Childhood could bring roughly 7,000 birth-to-5 children off state wait lists using funds already in the FY 2026 baseline.

Conway said the Commonwealth is seeing very high enrollment in the three state-funded early childhood programs — the Child Care Subsidy program, the mixed-delivery program and the Virginia Preschool Initiative (VPI) — and significant unmet need, especially for infants and toddlers. She reported more than 8,700 children on the birth-to-5 wait list for child care subsidy and an additional about 1,300 on the mixed-delivery wait list; the appendices referenced in the presentation show a total wait list just under 12,600 across programs and localities that currently maintain lists.

Conway outlined key elements of the governor’s proposed early-childhood package. The administration characterizes the one-year state investment as about $462 million. The proposal would:
- Use the four policy levers recommended by the Commission on Early Childhood (revising co-payments, work-search limits, attendance policy and other program parameters) to free slots that could serve an estimated 7,000 birth-to-5 children with existing state dollars.
- Provide a one-time $15 million to retrofit or increase local supply in child-care deserts.
- Pause future enrollment of new school-age participants in the child care subsidy program after July 1 for planning purposes, while not affecting current participants.

Conway described how reallocations already undertaken under recently enacted budget language (cited in the presentation as section 12510 of the Virginia budget) allowed the department to convert unused VPI slot funding after fall enrollment into about $5.2 million for roughly 830 children and an additional $3.0 million this month to create child care subsidy slots. She said those reallocations reflect the department’s charge to use unspent VPI dollars for other early-childhood slots.

Conway and commissioners discussed attendance and provider payment. She said the state has seen a marked increase, versus pre-pandemic levels, in children who are not regularly attending VPI or child care, which reduces school-readiness benefits and complicates provider payment. Conway noted Virginia operates a statewide quality accountability system called VQB5 that measures classroom quality in roughly 11,000 classrooms across 3,200 sites; according to the presentation, 98% of programs meet expectations, about 60% operate in private settings and 85% use a quality curriculum.

Federal changes also shape Virginia’s options, Conway said. A new federal rule caps family co-payments at 7% of income; it also moves states toward paying by enrollment (rather than attendance) and prospectively, and toward contracted slots for special-needs placements. Conway said Virginia currently holds waivers through August 2026 related to attendance-based payment and prospective payment while the state implements updated attendance tracking technology.

Committee members pressed for detail. Delegate Bridal asked whether the governor’s package would eliminate the wait list; Conway said it would not, leaving roughly 1,600 child care subsidy children and about 1,300 mixed-delivery children still unfunded after the governor’s proposal (Conway also cited roughly 39,100 school-age children in the subsidy program that are not addressed by additional slot funding in the proposal). Delegate Corner questioned how the attendance recommendations would help providers; Conway said the budget language charges the department to review and revise attendance policies across the three programs and that the proposal is currently language-only on attendance incentives pending better data.

Delegates also asked about federal rules and the order-of-magnitude costs. Conway said the most significant ongoing fiscal implications hinge on better attendance data and a new attendance-tracking contract the department expects to put in place in calendar year 2025; she described some one-time technology costs but said ongoing costs depend on the attendance and enrollment patterns that the new system will reveal. Conway described a pilot in Southwest Virginia (Ready Together) in partnership with the Early Childhood Foundation and a large employer, Ballad Health, where employers contributed $5,000 per employee, employees $2,000, and mixed-delivery funds covered the remainder to expand slots.

Conway said the governor’s proposal includes changes to family co-payments (an example in presentation materials: a $5-per-month minimum for families under poverty and sliding co-payments that cap at 7% of income for higher tiers) and would allow local departments discretion to grant exceptions to a 90-day job-search limit (with possible local extensions) when a family demonstrates ongoing efforts to obtain employment. She said guidance would define "hard to serve" exceptions (for example, children with special needs or where no local alternatives exist) and local offices would receive training and webinars on those definitions.

Conway pointed to regional variation in wait lists. She said Fairfax County uses significant local funding to provide vouchers and therefore had no children on the subsidy wait list in the department’s appendix; she contrasted that with other localities and noted targeted one-time retrofit funds in the governor’s proposal to address child-care deserts.

The presentation concluded with the committee taking questions; Conway said the department will continue work with the Commission on Early Childhood, the Department of Social Services and local offices to implement attendance tracking, review attendance policy, and refine guidance before any programmatic changes take effect.