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www.prenatal5fiscal.org 19 The cost of developing a cost esDmaDon model is also variable. The largest expense is usually related to data collecDon, which is similar for the market rate study. A state like Vermont that collects market rate data via an informaDon system could update this system to collect cost data as well, which would reduce the burden on providers, and cost to the state, of compiling a separate survey. However, to develop a cost model that fully reflects the true costs of care, it is highly advisable that providers are also engaged through focus groups or interviews, where they can share more about the costs they would incur if they were able to fully staff their programs, offer compensaDon at a level sufficient to recruit and retain educators, or make the necessary investments in their program. That engagement requires an intenDonal plan that relies on relaDonships, and also o1en requires resources to compensate providers for the Dme they spend engaging with the study. Beyond data collecDon, if the state has previously engaged in cost modeling efforts previously, o1en that model can be modified to meet the needs of subsidy rate senng, which would reduce the cost of the overall project.

B. Addi=onal Background Resources Capito, J. Rodriguez-Duggan, J. and Workman, S., Understanding the cost of quality child care in New Mexico: A cost es0ma0on model to inform subsidy rate seSng. (Prenatal to Five Fiscal Strategies, 2021). Available at: hFps://www.nmececd.org/wp-content/uploads/2021/08/P5FS_NMReport _v.3d_forWeb.pdf

Capito, J. and Workman, S., Using cost es0ma0on to inform child care policy. (Prenatal to Five Fiscal Strategies, 2021). Available at: hFps://www.prenatal5fiscal.org/_files/ugd/8fd549_62d3a75d3ede423abebc6b1841e8c328.pdf

Capito, J., Fallin Kenyon, K., and Workman, S., Understanding the True Cost of Child Care in California: Building a cost model to inform policy change. (Prenatal to Five Fiscal Strategies, 2022). Available at: hFps://www.prenatal5fiscal.org/_files/ugd/8fd549_831af20by4142b59fda1119 4bb908fd.pdf

Capito, J., Fallin Kenyon, K., and Workman, S. Understanding the True Cost of Child Care in Washington State: A cost esDmaDon model to inform policy change. (Prenatal to Five Fiscal Strategies, 2022). Available at: hFps://8fd54934-afdf-4222-bf73-b95e3b6260ee.usrfiles.com/ugd/ 8fd549_461355ef9a814c2094dcdea81fad1693.pdf

District of Columbia, Office of the State Superintendent of EducaDon, Modeling the Cost of Child Care in the District of Columbia [webpage]. Available at: hFps://osse.dc.gov/page/modeling-cost-child- care-district-columbia

U.S. Department of Health and Human Services, AdministraDon for Children and Families, Guidance on alterna0ve methodologies and cost analyses for purposes of establishing subsidy payment rates. Program InstrucDon CCDF-ACF-PI-2018-04. (2018). Available at: hFps://www.acf.hhs.gov/occ/policy-guidance/ccdf-acf-pi-2018-01

Virginia Department of EducaDon, Es0ma0ng the cost of high-quality early childhood care and educa0on: Virginia’s child care cost es0ma0on model. (2023). Available at: hFps://www.childcare.virginia.gov/home/showpublisheddocument/49756/638313107042070000

Workman, S. and Capito, J., Using the Provider Cost of Quality Calculator to es0mate the cost of quality. (NaDonal Center on Early Childhood Quality Assurance, 2022). Available at: