New Mexico Child Care: Proposed Co-Pays Start in 2027

The administration of outgoing New Mexico Governor Michelle Lujan Grisham has proposed monthly child care co-payments for families enrolled in the state's universal program. The fees would range from $15 to $148.50 and are set to begin no earlier than 2027.

The proposal addresses an inflation-related requirement in the law that created the program. According to Julia Sclafani, a spokeswoman for the Early Childhood Education and Care Department, approximately 10% of enrolled families would be subject to the charges. Affected households would receive at least 90 days' notice before payments begin.

The rules limit co-pays to working families earning more than 600% of the federal poverty level. For a household of four, that threshold is currently $198,000 annually. Families with one child in a child care center would pay between $15 and $99 per month based on income. The monthly ceiling rises to $148.50 for families with multiple enrolled children. A public hearing on the rules is scheduled for Dec. 3 in Santa Fe.

Gov.-elect Deb Haaland has pledged to preserve the universal child care initiative, describing it as an economic driver. Following her victory last week, she stated her administration would explore ways to keep families from having to pay co-pays. However, the legislation's inflation provision has already triggered the charges. Once introduced, the payments would continue through June 2027, the end of the state's current budget year.

New Mexico launched the nation's first universal child care initiative last year. Department figures show that more than 50,000 children now receive state-paid care, compared with about 33,000 before the launch. The program has faced logistical difficulties and questions about long-term financial sustainability.

The Governor's Office says Lujan Grisham resisted co-pays during this year's 30-day legislative session, but lawmakers included them to obtain passage of the bill, which received bipartisan support. The legislation permits withdrawals of up to $700 million from the state's early childhood trust fund over five years, beyond its regular annual distributions. The fund is projected to be worth roughly $12 billion at year's end.

Rep. Doreen Gallegos, D-Las Cruces, a sponsor of the 2020 legislation creating the fund, raised concerns about its future solvency. She said she hopes to discuss funding with Haaland's transition leaders and would pursue changes to the law during the 60-day legislative session beginning in January. Sclafani noted that the proposed payments would bring in little revenue compared with the program's overall budget while increasing administrative demands.