Challenges

Access, Scalability

Location

Michigan

Stakeholders

Businesses, Nonprofits, State Government

Beneficiaries

Parents, Children

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Overview

Michigan’s Tri-Share Child Care Program is an innovative public-private partnership model that makes childcare more affordable by splitting the cost between three parties: the employer, the employee, and the state government, each paying one-third.

Key Impact Metrics

  • 100+
    employers are participating in the progra
  • 100+
    employees are participating in the program
  • $2.5M
    invested by the Michigan government

Problem

For many working parents in Michigan, childcare was consuming a considerable part of their paycheck, yet they earned slightly too much to receive existing state childcare assistance. These “ALICE” families (Asset Limited, Income Constrained, Employed) often had incomes just above the subsidy cutoff, leaving them in a predicament. Michigan employers also lamented how the lack of affordable childcare hurts their hiring and retention. In the state’s Women’s Commission hearing in 2019, it was noted that childcare accessibility was a top barrier to women’s workforce participation.

Solution

In 2021, Michigan introduced its Tri-Share model in which the state, employers, and employees each pay one-third of the childcare bill for participating workers. To implement this, Michigan set up regional “facilitator hubs”—often local nonprofits or childcare organizations—that recruit employers and coordinate payments. Here’s how it works: an employer agrees to join Tri-Share and identifies employees who need childcare help. Those employees must fall within an income range—around 200%–325% of the poverty level, to target those not eligible for other aid. The employee chooses a licensed childcare provider that fits their needs. The childcare provider then bills the employer for one-third of the tuition, collects one-third from the state (using funds appropriated for Tri-Share), and the employee pays the remaining one-third—often through a convenient payroll deduction. A key element of this policy is that it’s voluntary for employers—the state incentivizes participation by matching their contributions dollar-for-dollar, essentially doubling the impact of what employers spend. By mid-2023, dozens of employers—from small businesses to large companies—had signed on. The state also raised the income eligibility over time to include more families.

Results

  • Beneficiary Impact65% reduction in childcare cost among families participating in the Tr-Share program
  • Employee Impact71% of employers agreed the program has helped retain employees, and 80% of participating employees noted that the Tri-Share program will continue to be an effective retention tool
  • Financial Results$464 average reduction in cost per month of participating families

Replication Tips

  • Build a coalition: Tri-Share was born from collaboration between a state agency (Michigan Women’s Commission) and a business group (Grand Rapids Chamber. To replicate, gather support from both the government and employers. Identify a champion in state government and an influential business association to advocate the model.
  • Use facilitator organizations: Having local or regional hub coordinators is crucial. Leverage nonprofits or chambers that can recruit employers and serve as intermediaries. This reduces complexity for individual employers and employees. Provide these hubs with modest administrative funding.

Suggested Implementation Timeline

~12-18 months

Sources