Last updated: April 22, 2026. CDEC licensing fees and ratios verified against cdec.colorado.gov as of this date.

How to Start a Daycare in Colorado (2026)

Starting a daycare in Colorado means working with the Colorado Department of Early Childhood (CDEC) — a standalone state agency created in 2022 specifically to consolidate early childhood programs. Before CDEC, licensing was split between the Department of Human Services and the Department of Education, creating confusion. Now there is one agency: CDEC, with licensing handled by DELLA (Division of Early Learning Licensing and Administration). Colorado also operates Colorado Shines, a quality rating system that determines your CCCAP subsidy reimbursement rates and affects your competitive position with families who receive assistance.

Three things make Colorado’s childcare landscape different: CDEC is newer (2022) and still evolving its systems; Colorado has a genuine child care shortage with significant unmet demand across the Front Range and mountain communities; and the Colorado Child Care Assistance Program (CCCAP) is administered county-by-county, meaning eligibility rules and reimbursement rates vary by geography — what works in Denver County doesn’t necessarily apply in Jefferson or Arapahoe County.

Colorado Child Care Licensing Requirements at a Glance

Requirement	Agency	Applies To	Cost
Family child care home license	CDEC / DELLA	4-6 unrelated children in home	$74/year
Large family child care home license	CDEC / DELLA	7-12 children, with required assistant	Varies
Center-based child care license	CDEC / DELLA	Commercial facility, 13+ children	Sliding scale by capacity
Health and safety training (15 hours, via PDIS)	CDEC professional development	All licensees	Varies; some free
Criminal history background check	CBI / FBI	All providers and household members	~$40-$75 per person
Child abuse/neglect registry check	CDEC	All providers and household members	Included in application
Sex offender registry check	CBI	All providers and household members	Included in background check
LLC formation	Colorado Secretary of State	Recommended for all operators	$50
General liability insurance	Private insurer	Required by most lenders/landlords	$1,000-$3,000/year
Workers’ compensation	Pinnacol / private insurer	First employee hired	Varies by payroll
FAMLI registration	Colorado FAMLI Division	First employee hired	0.88% of wages

How to Start a Daycare in Colorado (Step by Step)

Step 1: Understand the CDEC / DELLA Licensing Structure

What CDEC Is and Why It Matters

The Colorado Department of Early Childhood (CDEC) was created by the Colorado legislature in 2022 and became fully operational through a consolidation process completed in 2023. Before CDEC, Colorado child care licensing was administered through the Department of Human Services’ Office of Early Childhood. CDEC now has independent status and focuses entirely on early childhood programs — licensing, professional development, subsidy administration, and quality improvement.

DELLA (Division of Early Learning Licensing and Administration) is the licensing arm within CDEC. DELLA licenses child care centers, family child care homes, large family child care homes, and other programs. DELLA has over 5,000 licensed facilities statewide and a regional office structure for inspections and compliance.

License Types by Facility Size

Unlicensed family child care: Colorado allows caring for up to 4 unrelated children in your home without a license (with no more than 2 children under age 2). Once you exceed those limits, a Family Child Care Home license is required.

Family child care home license: 4-6 unrelated children. This is the core home daycare license. Fee: $74/year. You may care for additional related children (your own children or grandchildren) beyond the 6 unrelated limit.

Large family child care home license: 7-12 unrelated children in a home setting. Requires a qualified assistant to be present whenever more than 6 children are in care. More stringent facility requirements apply.

Child care center license: Commercial or institutional facilities. Multiple rooms, separate classroom spaces, age-grouped care. Fees are calculated on a sliding scale based on licensed capacity. Centers typically serve 13+ children and require multiple staff.

Step 2: Pre-Licensure Training — 15 Hours Minimum

Colorado requires child care providers to complete at least 15 hours of health and safety training delivered through the Colorado Shines Professional Development Information System (PDIS). Orientation-level components must be completed before working with children, and 15 hours of annual ongoing professional development is tied to maintaining Colorado Shines rating requirements.

The 15 hours must cover:

• Child development principles
• Colorado child care regulations
• Health, safety, and nutrition
• Guidance and discipline appropriate to child age
• Emergency preparedness

Training is available through CDEC’s approved training system. Some courses are free online; others are offered by CCR&Rs (Child Care Resource and Referral agencies) across the state. Colorado has a statewide professional development registry — Colorado Shines Professional Development Information System (PDIS) — where you log completed training hours. Your PDIS account is used throughout the licensing process and ongoing professional development.

The 15-hour requirement is both an initial competency standard and an annual ongoing professional development obligation. Additional continuing education is tied to your Colorado Shines rating level — higher ratings require more staff training hours. Directors of child care centers typically need additional administrator training hours beyond the 15-hour baseline.

Step 3: Background Checks — Everyone in the Home or Facility

Colorado’s background check requirements are comprehensive and apply broadly:

• Fingerprint-based criminal history check through the Colorado Bureau of Investigation (CBI) and FBI. This catches both in-state and out-of-state criminal records.
• Colorado child abuse and neglect registry check: Verifies the individual is not listed as a substantiated perpetrator of child abuse or neglect in Colorado records.
• Sex offender registry check

For family child care homes: all household members age 10 and older must complete background checks, not just the provider. If you have teenagers living at home, they will need checks. If your spouse or partner lives with you, they need checks. This surprises many first-time applicants.

For centers: all employees, volunteers who have unsupervised access to children, and any substitutes must complete checks. Checks must be completed before an individual begins working with children.

Background check clearance can take 2-6 weeks. Start this process early — delays here are the most common reason licensing timelines extend past 90 days.

Step 4: Apply Through the Colorado Provider Hub

Colorado’s Provider Hub is the online portal for child care license applications, renewals, and program management. Access it through CDEC’s website (cdec.colorado.gov).

The application requires:

• Completed online application form with facility details
• Proof of pre-service training completion (from your PDIS account)
• Background check clearance documentation
• Liability insurance certificate
• Floor plan and outdoor space description (for home daycares)
• Emergency plan documentation
• Transportation policy (if transporting children)
• Application fee payment

After submission, a DELLA licensing specialist is assigned to your application. They may request additional documentation or clarification before scheduling your inspection. Submitting a complete application with all documentation saves weeks in processing time.

Step 5: Facility Inspection by DELLA

Before your license is issued, DELLA will conduct an on-site inspection. Inspectors verify Colorado’s facility standards:

Indoor Space Standards

• Minimum usable indoor space per child: 35 sq ft for infants (6 weeks-18 months), 30 sq ft for toddlers and preschool-age children (center-based)
• Family home daycares: adequate space for active play, rest areas, and activities
• Safe sleeping environments for infants: firm mattress, no soft bedding, separate sleep spaces (cribs, pack-and-plays)
• Safe food preparation and storage areas separate from diapering areas
• Locked storage for all hazardous materials (cleaning supplies, medications)

Outdoor Play Space

• Access to safe outdoor play space is required
• For center-based care: typically 75 square feet per child of dedicated outdoor space
• Play areas must be fenced and free of hazardous equipment

Child-to-Staff Ratios

Age Group	Max Children Per Staff (Center)
Infants (under 12 months)	1:5
Young toddlers (12-24 months)	1:5
Older toddlers (24-36 months)	1:7
Preschool (3-5 years)	1:10
School-age (5+ years)	1:15

Step 6: Colorado Shines Quality Rating System

All licensed Colorado child care programs participate in Colorado Shines, the state’s quality rating and improvement system (QRIS). Ratings run from Level 1 to Level 5.

• Level 1: Automatically assigned upon licensure. Basic compliance only.
• Level 2: Requires additional training hours for all staff, completed health and safety checklist, and business practices documentation.
• Level 3: Requires staff credentials (child development associate credential or early childhood coursework), program environment assessment (using CLASS or ECERS tools), and ongoing professional development plan.
• Level 4-5: Require advanced staff credentials, demonstrated high-quality learning environments, and program accreditation or equivalent quality benchmarks.

Why Colorado Shines Rating Matters for Your Business

• CCCAP reimbursement rates: Colorado’s Child Care Assistance Program pays higher reimbursement rates to higher-rated programs. A Level 3+ program receives significantly more per child per day from CCCAP than a Level 1 program — directly affecting revenue from subsidized families.
• Quality improvement grants: CDEC and the Colorado Preschool Program offer grants to programs working toward higher ratings. These can fund staff training, curriculum materials, and facility improvements.
• Marketing differentiation: Families researching providers see Colorado Shines ratings prominently displayed. Moving from Level 1 to Level 3 can be a meaningful differentiator in competitive markets.

Step 7: CCCAP — Colorado’s Childcare Subsidy Program

The Colorado Child Care Assistance Program (CCCAP) provides child care subsidies to eligible low-income families. For a daycare business, accepting CCCAP families is both a community service and a revenue stream. Key points:

• County-administered: CCCAP is run by county human services departments. Eligibility rules, waitlists, and reimbursement rates vary by county. Denver County, Jefferson County, Adams County, and others each have their own programs.
• Provider enrollment: To accept CCCAP families, you must enroll as a CCCAP provider with the relevant county. The county pays you directly for authorized care.
• Reimbursement rates: Set by county based on a “market rate survey” and adjusted by Colorado Shines rating level. Higher-rated programs receive higher reimbursement.
• Co-payments: Families pay a sliding-scale co-payment; CCCAP covers the balance up to the program limit. You collect the co-payment directly from the family.

A waitlist exists for CCCAP in many counties. Families often wait months to receive assistance. Operating in counties with shorter waitlists (some rural counties) or securing one of the county’s limited CCCAP provider slots can improve financial stability.

Step 8: Business Formation and Insurance

LLC Formation

Register an LLC with the Colorado Secretary of State via MyBizColorado ($50 filing fee). For any facility with employees or significant assets, an LLC is strongly recommended for liability protection. Annual reports are $10/year.

General Liability Insurance

Child care-specific general liability insurance covers bodily injury claims, property damage, and some professional liability. Commercial policies for home daycares typically run $1,000-$2,000/year. Center-based policies are larger — $2,000-$6,000/year depending on enrollment and coverage limits. Homeowner’s or renter’s insurance does not cover commercial child care operations; do not rely on it.

Workers’ Compensation — At First Employee

Colorado requires workers’ comp the moment you hire your first employee. For a home daycare with one assistant, this applies immediately. Pinnacol Assurance is Colorado’s primary workers’ comp carrier; they are required by law to cover any eligible employer. Child care workers have moderate injury rates — back injuries from lifting children are common. Workers’ comp premiums for child care facilities (NCCI class code 8869) are moderate.

Step 9: Colorado FAMLI — Paid Leave for Child Care Employees

Colorado’s Family and Medical Leave Insurance (FAMLI) program applies to all employers:

• 0.88% of gross wages total (2026 rate)
• 10+ employees: 0.44% employer + 0.44% employee share withheld
• 1-9 employees: No employer share; withhold and remit 0.44% employee share only

For a center with 3-4 staff, you’re in the 1-9 category and pay no employer share. FAMLI provides employees up to 12 weeks of paid leave — when a staff member takes leave for a new child, serious illness, or family care need, the state pays them (not you), so your payroll cost during the leave is reduced.

Denver-Specific: Minimum Wage and Local Licensing

Denver’s minimum wage is $19.29/hour for 2026 — applicable to employees working 4 or more hours per week within Denver city limits. For a Denver daycare, all employee hours are at the Denver rate. The state minimum of $15.16/hour applies in unincorporated areas and cities without a higher local rate.

Denver also requires a general business license for child care centers operating within city limits. Apply through Denver Excise and Licenses (denvergov.org/licenses). Check Denver zoning for center-based care — not all commercial or residential zones permit child care centers.

Startup Cost Estimates

Home-Based Family Child Care (4-6 Children)

Item	Estimated Cost
LLC formation (MyBizColorado)	$50
DELLA family home license fee	$74
Background checks (provider + household members)	$100-$300
Health and safety training (15 hours, via PDIS)	Free-$200
General liability insurance (child care specific)	$1,000-$2,000/year
Child-proofing, safety equipment, cribs	$1,000-$3,000
Curriculum materials and supplies	$500-$1,500
Food and nutrition program registration	Free (CACFP reimbursement program)
Total home-based startup	$3,000-$7,000

Center-Based Child Care (13-30 Children)

Item	Estimated Cost
Leasehold improvements and build-out	$20,000-$80,000
Furniture, equipment, learning materials	$10,000-$30,000
DELLA center license fee	$200-$600 depending on capacity
Background checks (all staff)	$500-$1,500
General liability insurance	$2,000-$6,000/year
Workers’ compensation insurance	Varies by payroll
Working capital (3 months operations)	$15,000-$40,000
Total center-based startup	$50,000-$160,000

Colorado Child Care Market Context

Child Care Desert

Colorado has been designated a “child care desert” in multiple national studies — meaning many communities have far more children under age 5 than available licensed care slots. The Front Range has significant unmet demand, particularly for infant care (the most expensive and most labor-intensive age group) and flexible/evening/weekend care. This means a well-run daycare in Colorado can fill enrollment quickly and maintain waitlists.

Rural Colorado

Mountain communities — Summit County, Eagle County, Pitkin County — face extreme child care shortages. Tech workers and resort employees need care for young children in communities where few providers operate. Some counties have used local funds and grants to encourage child care startups. The lower density of competition in rural Colorado creates opportunity, though startup costs may be higher due to construction and living costs.

Colorado Universal Preschool (UPK)

Colorado’s Universal Preschool (UPK) program launched in 2023 and provides free preschool for all 4-year-olds, with some 3-year-olds eligible. Child care centers and family home providers can become UPK partners, accepting state-funded preschoolers and receiving state reimbursement. UPK partnership requires a minimum Colorado Shines rating and additional quality standards. For eligible programs, UPK can be a significant and stable funding stream.

Related Colorado Business Guides

• Starting a Business in Colorado: Complete Guide

← Back to all Colorado business guides

Frequently Asked Questions

What agency licenses daycares in Colorado?

In Colorado, child care facilities are licensed by the Colorado Department of Early Childhood (CDEC), specifically through DELLA — the Division of Early Learning Licensing and Administration. CDEC was established in 2022 as a standalone department consolidating early childhood programs previously split across multiple agencies. DELLA licenses over 5,000 child care facilities statewide. Applications are submitted through the Provider Hub portal.

How long does it take to get a Colorado child care license?

The Colorado child care licensing process typically takes 60-90 days from application submission to final license issuance. Timeline depends on background check processing, facility inspection scheduling, and completeness of your application. Submitting an incomplete application is the most common cause of delays. DELLA recommends starting the process at least 3-4 months before your planned opening date to allow buffer for any issues.

What is the family home daycare license fee in Colorado?

The family home child care license fee is $74 in Colorado. Center-based child care fees vary by licensed capacity and are set on a sliding scale. Fees are paid through the Provider Hub. Note that the license is separate from your local business license, zoning approvals, and building/fire code permits, which may carry additional fees.

What is Colorado Shines and why does it matter for a new daycare?

Colorado Shines is Colorado’s quality rating and improvement system (QRIS) for child care programs. All licensed facilities receive a Level 1-5 rating. The rating matters for several reasons: CCCAP (Child Care Assistance Program) subsidy reimbursement rates are higher for higher-rated programs; some counties require a minimum rating level to accept CCCAP; and CDEC quality improvement grants and coaching are available to programs working toward higher ratings. Starting at Level 1 is automatic; getting to Level 3-5 requires additional professional development hours and program quality improvements.

What are Colorado’s child-to-staff ratios for daycare?

Colorado’s required child-to-staff ratios by age group: infants (under 12 months) – 1:5; young toddlers (12-24 months) – 1:5; older toddlers (24-36 months) – 1:7; preschool 3-4 years – 1:10; preschool 4-5 years – 1:12; school-age (5+ years) – 1:15. Family home daycares have different capacity limits: unlicensed family homes can care for up to 4 unrelated children without a license (with no more than 2 children under age 2); a family child care home license is required for 4-6 unrelated children; a large family child care home license covers up to 12 children with an assistant.

Can I run a daycare out of my home in Colorado?

Yes. Colorado has two home-based license types: family child care home (4-6 unrelated children, $74 license fee) and large family child care home (7-12 children, requires an assistant). Home daycares must meet Colorado’s physical environment standards for indoor space (35 sq ft per child for infants, 30 sq ft for toddlers and preschool-age), outdoor space access, safe sleeping environments for infants, food safety requirements, and secure hazardous material storage. Your local zoning must permit home-based child care — check with your city or county planning department. Some HOAs prohibit commercial operations.

Colorado-Specific Resources

Resource	Use	Where to Find
CDEC (Colorado Dept of Early Childhood)	Licensing authority, UPK, CCCAP	cdec.colorado.gov
Colorado Provider Hub	License application and management	Via cdec.colorado.gov portal
Colorado Shines PDIS	Professional development registry, training	coloradoshines.com
Colorado CCR&R Network	Child care resource and referral agencies by county	coloradoccrr.org
Colorado FAMLI	Paid leave registration	famli.colorado.gov
Pinnacol Assurance	Workers’ compensation coverage	pinnacol.com
USDA CACFP	Child and Adult Care Food Program reimbursement	fns.usda.gov/cacfp
MyBizColorado	LLC formation, business registration	mybiz.colorado.gov