How to start a daycare in Colorado

1. Choose a daycare center or a home daycare

States license daycare centers and home daycares (often called family child care homes) under different rules, with different limits on how many children you can care for. Decide which one you're starting before anything else.

Colorado's license types are described in Who needs a daycare license above. Learn what families near you need, too: your local Child Care Resource and Referral agency (CCR&R) can tell you which ages and hours are hard to find, and our Colorado program finder lists licensed centers near you.

2. Contact CDEC

Daycare licensing in Colorado is handled by the Colorado Department of Early Childhood (CDEC), Division of Early Learning, Licensing, and Administration. Contact it before you sign a lease or buy equipment, and ask, in writing if you can:

• Which license type fits our plans, and how many children can it cover?
• Is there an orientation or pre-licensing training, and when is the next one?
• Which inspections and clearances do we need (licensing, fire, health and zoning)?
• What does it cost to apply, and how long does approval usually take?
• What do we need to do to accept families who use childcare assistance?

3. Choose a business structure

A daycare can run as a business (such as an LLC) or as a nonprofit, or under an existing nonprofit such as a church. Talk with an accountant or lawyer before you file anything, and get an employer identification number (EIN) from the IRS. It's free.

4. Find a space that can pass inspection

Check zoning before you sign a lease. Then ask the building department, the fire marshal and CDEC what the space needs, including how much indoor and outdoor space per child Colorado requires. Since December 28, 2012, cribs in daycares must meet federal Consumer Product Safety Commission standards.

5. Plan your rooms around the ratios

Colorado's ratios for the ages it confirmed are in the table above. They decide how many staff each room needs, so they shape your whole budget. For infants and toddlers, ask CDEC.

• Work out your staffing with the staff ratio calculator.

6. Hire staff and run background checks

Run the checks in Background checks for daycare staff above before anyone starts.

Federal rules also require comprehensive background checks for staff of every licensed, regulated or registered childcare provider and every provider that can take childcare assistance. Teach every staff member how to report suspected abuse or neglect (see Reporting child abuse above).

7. Get insured

Talk early to an insurance broker who works with childcare programs. Ask about general liability, abuse and molestation coverage, property coverage and workers' compensation, plus auto coverage if you'll transport children. A home daycare should tell its homeowner's or renter's insurer, since those policies may limit business use.

8. Build a budget and set tuition

Start with payroll (see step 5), then add rent, food, supplies and insurance. Compare your numbers with what other daycares near you charge, and set prices for the enrollment you expect, not a full room. Write down your deposit, late payment, late pickup and absence policies before you enroll anyone.

• Plan payments with the payment plan calculator and the sibling discount calculator.
• Give a receipt for every payment. Parents may need it for a dependent care FSA or tax credit (childcare receipt generator).

9. Add childcare assistance and the food program

Ask Colorado's childcare assistance office how to become an approved provider for families who get help paying for care, and ask about the USDA Child and Adult Care Food Program (CACFP), which reimburses eligible daycares for meals and snacks. Programs that take childcare assistance must meet federal health and safety requirements, including background checks, training and inspections.

10. Prepare your enrollment forms and policies

Ask CDEC which records you must keep for each child. Have your forms ready before you enroll anyone, and collect everything before a child's first day.

Medication in Colorado. Any prescription or over-the-counter medicine needs both a written order from a health care provider with prescriptive authority and written parent consent; home remedies, vitamins and supplements may not be given, while sunscreen and insect repellent need only parent permission. Medicine stays in its original labeled container (OTC labeled with the child's name), is locked up except emergency medicine, is given only by staff with Department-approved medication administration training and current delegation from a child care health consultant, and each dose is recorded in a medication log.

• Registration form, medical and allergy form and authorized pickup form
• Medication administration log and allergy alert roster
• Incident and accident report, parent handbook and emergency action plan
• A safe sleep policy: babies under 12 months sleep on their backs, on a firm, flat surface, with no blankets, pillows, toys or other soft items in the crib

11. Fill your spots

Start enrolling before you open, so you aren't paying staff for empty rooms. Tell your CCR&R you're open, check your listing in the state's childcare search once you're licensed, offer tours and keep a waitlist for each age group.

12. Pass your inspections and open

For licensed programs that can take childcare assistance, federal rules require at least one inspection for health, safety and fire standards before licensing, then an unannounced inspection at least once a year. Schedule yours early, train staff on your policies, emergency plan, safe sleep, allergies, medication and pickup rules, and check every child's file before their first day.

What we couldn't confirm

Check these points with the state before you rely on them.

• 8 CCR 1402-1 §2.112 lists neighborhood youth organizations as not needing a license, while §2.700 calls them 'licensed'; whether they hold a separate license or are simply exempt from child care center licensing is not confirmed.
• Whether every before/after-school program run directly by a public school district must be licensed (rather than only those that choose to be) is not confirmed; the statute (C.R.S. §26.5-5-303) was not checked.
• The statutory mandated reporter list (C.R.S. §19-3-304) is from the Child Welfare Information Gateway summary (May 2023); the statute text on the official Colorado code site (LexisNexis) was not checked, so later changes are not confirmed.

How BackPR helps

BackPR handles registration, enrollment and health forms, recurring tuition with autopay and check-in against each family's authorized pickup list. Families can register and fill in forms in English or Spanish, and parents get receipts and year-end dependent care statements. It's free for nonprofits, with no subscription and no BackPR fees. Payments run on Stripe, and Stripe's processing fees apply. Other programs get pricing by quote. More on BackPR for childcare.