Massachusetts C3 Grants: Post-Pandemic Childcare Stabilization and Expansion

Challenges

Access, Scalability

Location

Massachusetts

Stakeholders

Businesses, State Government

Beneficiaries

Parents, Childcare Providers

Overview

Massachusetts’ Commonwealth Cares for Children grant initiative stabilized the childcare sector during and after COVID-19 by providing sustained operational funding to providers.

Key Impact Metrics

7%
increase in the number of childcare programs statewide
7,500
childcare providers receiving C3 grants
10,602
new childcare slots added

Problem

The pandemic dealt a severe blow to childcare in Massachusetts. By spring 2021, the state had 37,000 fewer licensed seats than before COVID-19, as many centers closed or downsized. The shortage of childcare not only affected families but also hampered the broader economic recovery. The Massachusetts government realized that without intervention, many providers would shut their doors permanently, further reducing access and driving up costs for remaining centers.

Solution

The state’s response was the Commonwealth Cares for Children (C3) Stabilization Grant program. Beginning in 2021, Massachusetts used federal American Rescue Plan Act (ARPA) funds to send monthly grants to childcare providers to cover fixed costs, salaries, and quality improvements. Unlike competitive grants, C3 was non-competitive and formula-based—virtually all licensed providers could apply and receive funding pegged to their capacity and other factors. Seeing positive results, Governor Maura Healey moved to sustain C3 with state dollars once federal aid lapsed: the FY2024 budget dedicated $475 million in state funds to continue C3—fully state-funded for the first time. The program compels providers to use a portion of funds for workforce investments (e.g., raising educator pay) and to reduce childcare tuition increases. By late 2023, Massachusetts announced the childcare system had “rebounded,” with capacity not only recovered but exceeding 2019 levels.

Results

Beneficiary Impact
10,602 new childcare slots added
Employee Impact
84% of providers report using C3 funds to freeze or lower childcare fees for parents, and 20% decrease in turnover among childcare employees
Financial Results
$1.7B averted in potential productivity losses

Replication Tips

Use Federal funds as a proof of concept: Massachusetts started with one-time federal funds and proved the concept. Other states can pilot stabilization grants with available federal or recovery funds and measure the impact.
Keep it simple and inclusive: C3 grants had a low-barrier application and reached ~90% of providers. Replicators should make funding accessible to all licensed providers, which strengthens the whole ecosystem.
Tie funding to outcomes: Massachusetts required providers to sustain wages and contain childcare costs in exchange for grants. Replicators can similarly set but clear expectations for grant use.