New Mexico made history last week when it became the first state in the country to make child care free for everyone.
The state already offers universal Pre-K for 3- and 4-year-olds, and they already had an expansive child care program that would subsidize care for anyone making up to 400% of the poverty level — about $124,000 dollars a year.
But now, Gov. Michelle Lujan Grisham has removed the income eligibility requirement. And anyone working or in school in the state can qualify. They expect the program to save New Mexico families $12,000 a year.
But it hasn’t come easily — and it won’t be cheap. The Show spoke more about it with Elizabeth Groginsky, cabinet secretary for New Mexico’s Early Childhood Education and Care Department, which was created in 2019.
Full conversation
LAUREN GILGER: Tell us about the reaction to this. Like, do people who make over that 400% of the poverty level say that they need this kind of assistance?
ELIZABETH GROGINSKY: They absolutely do need it. We've heard from two educators here in Santa Fe who were thinking they may have to leave the state because they make just over that 400% income and they have a 16-month-old child. Their child care costs them $1,200 a month. In most communities in New Mexico and probably across the country, the child care bill is as high, if not higher, than mortgage and rent for most families.
Oftentimes, families negotiate who can work, who can't, who can stay home, always concerned about how to make the child care expense work. And so we see this as freeing up families to realize their full potential while supporting young children to be in these healthy, high quality, safe learning environments.
GILGER: Right. Talk a little bit about what this has looked like in the last five years since this department began. I mean, you're trying to solve a problem that is, you know, universal. Like this is a problem that exists across the country in terms of the soaring cost of child care that just seemed to be going up. And the need to actually fill the positions to do it.
GROGINSKY: Right.
GILGER: Like finding enough providers to do it. How have you tackled that in terms of creating, I guess, the infrastructure to do it?
GROGINSKY: Exactly. One thing that we've done here in New Mexico, we were the first state in the country to use a cost alternative methodology for establishing our rates to pay child care. And what that allowed us to do was to look at the true cost of delivering care. We're looking at all the costs, our licensing regulations that providers incur, but also other state laws like mandatory sick time for employees and small businesses. So we put all of that into a model and we set our rates.
First time we did it, we set the floor for entry-level staff at $12.10 because that was the highest minimum wage in the state in 2021. We then updated it in ‘23 to $15 as a floor, but right away we saw post-pandemic salaries for most jobs were starting at $17 and $18.
And so that's what we've done with this recent proposed rate increase is setting that floor at $18 for entry-level staff. Our results have shown great progress. We've had a 64% growth in our early childhood professionals, compared to the rest of the country, where it's declined by about 7%.
GILGER: So you paid them more and they came in, basically?
GROGINSKY: Yes, we paid them fair wages for the value of their work. Should they be higher? People could argue that, but we have set a trajectory in this state to pay our early childhood professionals.
GILGER: So let me ask you about the money then. I mean, this must be an astronomical amount of money in a way to think about trying to not only pay child care providers much more than they're already being paid, to expand this program so that it's universal and anybody can get in. How is the state going about funding this?
GROGINSKY: Yes, we are, have been very smart in this state. Our governor and our Legislature have made incredibly wise investments. In 2020, the governor created the Early Childhood Trust Fund and the Legislature put $300 million in there. And it's funded through surplus oil and gas revenues, federal mineral leasing. That fund has now grown to nearly $10 billion.
GILGER: Wow.
GROGINSKY: It's the interest of that fund that supports the work of the Early Childhood Education and Care Department. So in 2026, we have about … a little over $450 million to support child care assistance. That's a combination of the trust fund, general fund and federal funds. We have asked for another $120 million for fiscal year ‘27 so that we can continue this promise to New Mexico families of a universal child care system.
LAUREN GILGER: And that additional $120 million will have to be approved by the state Legislature. This also, though, comes at a time when New Mexico is really being hard hit by federal funding cuts on a lot of fronts and in ways that many other states aren't.
Is that playing a role here? Is that going to make this harder?
GROGINSKY: I think that the governor and the Legislature are doing very smart things in terms of looking at what the federal landscape looks like, but also recognizing that when they created the department and they supported the trust fund, and then 70% of voters said, let's use a portion of our land grant to fund early childhood education and care, they know that this is the promise of better outcomes for all of our families, better health, better education, better social outcomes.
When we start early and give families young children the quality experiences they need, deserve, and want, we are going to see an improved outcome, a 13% return on that investment. And our lieutenant governor said it well. These are not expenditures. These are investments we're making in New Mexico families and in our human capital.
GILGER: It's interesting because it is being framed as an economic investment and in this economic way. There are obviously critics of this program and this expansion, people who say we should focus on, you know, the low-income families who need it most, the kids most at risk of abuse or neglect. And there are concerns about the cost of this going forward.
Is this sustainable in the long term?
GROGINSKY: Yes, it is sustainable. And we share that concern. And we are releasing a request for proposal this week for contracted slots for infants and toddlers, specifically for low income children and children with special needs. And the governor has put $13 million into a low interest loan revolving loan fund to help child care businesses access capital to build their supply because we know we need more supply. And again, the return for this investment is 10-fold. And we look forward to being able to share those results with others in other states. We're getting a lot of calls from across the country, which is very exciting.
GILGER: That leads me to my final question, which is, is this sort of a model in your mind for what other states should be or could be doing? I mean, I wonder if you hope that this changes the game, changes the conversation around what's even possible in the realm of funding child care.
GROGINSKY: We absolutely do. The governor sees it as a model. We see it as a model, and we hope, we hear from everyone: “You've given us hope.” There is a way to do this, and it's about putting families at the center of your policymaking.
