Last updated: May 4, 2026

How to Start a Daycare in Montana (2026)

Montana is one of the fastest-growing states per capita, with Bozeman and the surrounding Gallatin Valley ranking among the highest-growth metros in the entire country. That growth has a direct effect on child care: both working parents and young families are moving in faster than licensed child care capacity is being added. Waiting lists at licensed centers in Bozeman, Missoula, and Billings are routinely 12 to 24 months long for infant slots. If you are considering opening a daycare in Montana, the market demand is real – but so is the regulatory framework. The Montana Department of Public Health and Human Services (DPHHS), Early Childhood and Family Support Division licenses and regulates all child care facilities under Montana Administrative Rules Title 37. The license type you need depends on how many children you plan to serve and whether you are operating from your home or a dedicated facility.

Montana’s child care landscape has three structural features that shape every business decision. First, the state uses distinct license tiers by capacity – Family Child Care Home, Group Child Care Home, and Child Care Center – with meaningfully different ratio, facility, and staffing requirements at each level. Second, Montana’s STARS to Quality voluntary quality rating system is currently in a full redesign and is projected to relaunch on October 1, 2026; it is not accepting new center ratings at this time, which affects how you plan for subsidy alignment. Third, the Best Beginnings Child Care Scholarship – Montana’s implementation of the federal Child Care and Development Fund (CCDF) subsidy – was expanded in 2023 to serve families up to 185% of the Federal Poverty Level (up from 150%), meaningfully widening the pool of children eligible for subsidized enrollment. A licensed center that can accept Best Beginnings-funded children has access to a much larger market than a private-pay-only program.

This guide covers all three license tiers, the DPHHS application process, background check requirements, staff-to-child ratios, facility standards, the STARS to Quality rating system status, and the Best Beginnings Scholarship framework, using official Montana sources current as of May 2026.

Montana Daycare Requirements at a Glance

Requirement	Agency / Source	Cost	Timeline
LLC formation	Montana Secretary of State (biz.sosmt.gov)	$35 online / $70 mail	3-5 business days online
Federal EIN	IRS (IRS.gov)	Free	Immediate online
Child Care Facility License (type varies)	DPHHS Early Childhood and Family Support Division	Fee schedule not publicly posted; contact (406) 444-2012	60-120 days (background checks + inspection)
FBI Fingerprint Background Check	Montana DOJ + FBI (required if staff lived outside MT in past 5 years)	Free at Spark Montana locations	2-6 weeks
Montana Name-Based Criminal History Check	Montana DOJ via DPHHS CCL	Processed as part of application	1-2 weeks
Child Protective Services History Check	DPHHS (MT + any state of past 5-yr residence)	Free	1-3 weeks
CPR / Pediatric First Aid (director)	Red Cross, AHA, or approved provider	$50-$150	1-day course
Staff immunizations (Tdap + MMR)	Personal physician or health department	Varies by insurance	Before hire
Pre-licensing facility inspection	DPHHS CCL	Included with license	Scheduled after application review
Workers’ compensation insurance	Montana State Fund or private insurer (NCCI 9059)	Premium-based on payroll	Required before first employee
General liability insurance	Private insurer	$1,500-$4,500/year typical	Recommended before application

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

Step 1: Choose Your License Type

Montana child care licensing is structured by the number of children served and the physical setting. Choose the tier that matches your plan before you do anything else, because the ratio requirements, facility standards, and application complexity differ significantly between tiers.

License Type	Setting	Capacity	Key Restrictions
Family Child Care Home	Provider’s residence	3-8 children	No more than 3 children under age 2 at any one time
Group Child Care Home	Residence or dedicated space	9-15 children maximum	Additional staffing requirements over Family Home
Child Care Center	Dedicated commercial facility	16+ children	Full facility standards, director qualifications, policy manual required

Family Child Care Homes are the most common entry point for first-time Montana childcare providers and carry lighter facility standards, but the under-age-2 cap of three children is a significant constraint on infant revenue. Group Homes are a middle tier that many providers use as a stepping stone. Child Care Centers require the most compliance work but have no hard capacity ceiling beyond what your staffing ratios and facility square footage will support – and Centers are the tier most relevant for owners planning to serve Best Beginnings Scholarship-funded families at scale.

DPHHS Child Care Licensing contact: Phone (406) 444-2012, email childcarelicensing@mt.gov, website dphhs.mt.gov/ecfsd/childcare/childcarelicensing, mailing address PO Box 4210, Helena, MT 59620-4211.

Step 2: Form Your Business Entity and Get Your EIN

File an LLC with the Montana Secretary of State online at biz.sosmt.gov for $35. Mail filings cost $70 and take longer. The LLC name must be distinguishable from all other Montana business names – search the database on the SOS website before committing to a name. Montana’s annual report fee is currently waived through April 15, 2026; after that date, the standard $20 annual fee applies.

Get a free federal Employer Identification Number (EIN) at IRS.gov – you will need this for payroll tax deposits, business bank account opening, workers’ compensation policy, and any state tax registrations. If you plan to serve families receiving the Best Beginnings Scholarship, the DPHHS subsidy office will also require your EIN to set up provider payments.

Step 3: Background Checks for All Staff and Household Members

Montana’s background check requirements for child care are among the most thorough in the Mountain West. Every owner, operator, employee, and volunteer who has unsupervised access to children – and every adult household member at a Family Child Care Home – must complete the full check stack. Checks must be repeated annually and whenever a new person joins the program.

The Montana CCL background check stack includes:

• Montana name-based criminal history check: Run through the Montana Department of Justice. DPHHS CCL coordinates this as part of the application process.
• FBI fingerprint background check: Required for any person who has lived outside Montana at any point in the past 5 years. Montana DOJ submits fingerprint cards to the FBI. Free fingerprinting is available through Spark Montana locations statewide.
• Montana Sex Offender Registry check: Processed through the Montana DOJ. CCL handles this check during the application.
• Child Protective Services (CPS) history check: Montana CPS records plus equivalent records from any state where the person has lived in the past 5 years. CCL coordinates multi-state CPS checks.

Anyone with a disqualifying criminal conviction, a sex offender registry listing, or a substantiated child abuse or neglect finding cannot work at the facility in any capacity involving contact with children. Certain offenses are automatically disqualifying; others are reviewed on a case-by-case basis. Contact DPHHS CCL before submitting your application if you have any concerns about a specific conviction history.

Step 4: Training and Certification Requirements

Montana childcare staff must meet minimum training standards as a condition of licensure. The core requirements include:

• CPR certification: Covering infant, child, and adult CPR. Must be from an approved provider (Red Cross, American Heart Association). Required for director and key staff; recommended for all staff.
• Infant choking response certification: Separate from general CPR; covers infant Heimlich maneuver and airway obstruction response.
• Pediatric first aid certification: Covers wound care, fever response, allergic reaction, seizure response, and other medical emergencies common in child care settings.
• Immunizations – Tdap and MMR: All staff must have current documentation of Tdap (tetanus, diphtheria, pertussis) and MMR (measles, mumps, rubella) vaccinations. Documentation must be kept on file and presented at licensing inspections.
• Annual training hours: Child Care Center staff have in-service training requirements under ARM 37.95. Family Child Care Home providers must complete 8 hours of approved training per year. Contact DPHHS CCL for the current training hour requirement applicable to your license type.

Approved training providers include Montana State University Extension, the Montana Child Care Resource and Referral Network, and various national online programs. Contact childcarelicensing@mt.gov for the current list of approved training and the specific requirements for your license type and staff roles.

Step 5: Meet ARM Title 37 Facility Standards

Your facility must satisfy Montana’s child care facility standards before a license will be issued. The standards are set out in ARM Title 37 (administrative rules governing health and human services). Key requirements for Child Care Centers include:

Staff-to-child ratios (ARM 37.95.623):

Age Group	Minimum Staff-to-Child Ratio	Maximum Group Size
Newborn to 23 months	1 staff : 4 children	12
2-3 years	1 staff : 8 children	16
4 years	1 staff : 10 children	24
5 years and older	1 staff : 14 children	32

The 1:4 infant ratio is the economic hinge of any Montana Child Care Center. Four infants require one full-time caregiver present every minute of the day. At Bozeman or Missoula market rates of $1,800 to $2,500 per month per infant, a room of 8 infants (two caregivers) can generate $14,400 to $20,000 per month in gross tuition – but the labor cost for two licensed staff, when benefits and statutory obligations are included, will consume a large portion of that margin. Plan your enrollment mix carefully before you sign a lease.

Physical facility requirements include:

• Minimum usable indoor floor space per child (contact DPHHS CCL for current ARM square footage minimums by license type)
• Fenced outdoor play area for centers
• Separate designated sleep areas for infants (in approved cribs meeting current CPSC safety standards)
• Age-appropriate bathroom facilities at child height
• Commercial kitchen or approved food preparation area if meals are served on-site
• Smoke detectors, carbon monoxide detectors, fire extinguishers, emergency exit signage, and a written emergency/evacuation plan
• Safe, locked storage for cleaning chemicals and other hazardous materials
• Functioning handwashing sinks accessible to children at each age-group classroom

Step 6: Insurance and Workers’ Compensation

Montana requires workers’ compensation coverage for any employer with one or more employees. Child care centers are classified under NCCI code 9059 (Child Day Care Center). You can obtain WC coverage through a private insurer or through the Montana State Fund, which is Montana’s competitive state-operated workers’ compensation insurer. Montana State Fund is not exclusive – private carriers also write Montana WC – but it serves as the market of last resort for employers who cannot find private coverage.

General liability insurance at $1 million per occurrence is expected by most commercial landlords and by DPHHS for any center participating in Best Beginnings Scholarship payments. Many insurers also offer a child sexual abuse and molestation (CSAM) rider, which most child care risk managers recommend adding. Budget $1,500 to $4,500 per year for GL depending on your capacity and market.

Step 7: Apply Through DPHHS CCL and Pass Inspection

Montana processes child care licensing applications through an online portal system managed through Okta. Contact DPHHS CCL at (406) 444-2012 or childcarelicensing@mt.gov to request access credentials and the current application packet for your license type.

Important: DPHHS does not publicly post a child care licensing fee schedule on their website. The fee for your license type is confirmed during the application intake process. Call or email CCL before submitting to confirm current fees and avoid any delays.

Your application package for a Child Care Center will include:

• Completed application form
• Background check authorization forms for all staff and household members
• Facility floor plan with room dimensions and designated use for each space
• Proof of current immunizations for all staff
• CPR and first aid certification documentation
• Written policies and procedures manual (required for Child Care Centers)
• Proof of workers’ compensation insurance
• Certificate of general liability insurance
• Local business license (required by most Montana cities and counties)

After your application is reviewed, your background checks are cleared, and any required documentation is accepted, a DPHHS CCL representative will schedule an on-site pre-licensing inspection. The inspection verifies compliance with all ARM Title 37 physical space, equipment, safety, documentation, and staffing requirements. Upon passing inspection, your license is issued. Annual unannounced inspections follow as a condition of continued licensure.

Montana STARS to Quality: Current Status

Montana operates a voluntary quality rating and improvement system called STARS to Quality with five levels: Pre-Star and Stars 1 through 5. Higher STARS ratings signal program quality to families and are used to align subsidy reimbursement tiers. However, as of May 2026, the STARS to Quality program is undergoing a full redesign and is not currently accepting new center ratings. The projected relaunch date is October 1, 2026.

This means that if you are opening a new center in 2026, you will likely not be able to pursue a STARS rating until after the October 1 relaunch. When the redesigned system launches, it will be worth pursuing – higher STARS levels typically unlock higher Best Beginnings Scholarship reimbursement rates and serve as a marketing differentiator in competitive markets like Bozeman and Missoula where educated parents actively research program quality. Monitor updates at dphhs.mt.gov/ecfsd/childcare/ and through the Montana Child Care Resource and Referral Network.

Best Beginnings Child Care Scholarship

Montana’s Best Beginnings Child Care Scholarship is the state’s implementation of the federal Child Care and Development Fund (CCDF). It subsidizes child care costs for income-eligible working families. In 2023, the Montana Legislature expanded the income eligibility threshold from 150% to 185% of the Federal Poverty Level, significantly widening the pool of families who qualify. At 185% FPL, a family of four earning up to approximately $57,000 per year may be eligible.

For a licensed Child Care Center, becoming an approved Best Beginnings provider opens access to a large and growing segment of Montana families who could not otherwise afford market-rate infant and toddler care. Best Beginnings pays providers directly based on approved rates that vary by child age, county, and (once STARS relaunches) quality rating tier. Families typically owe a small co-payment based on income.

To become a Best Beginnings provider, your facility must hold a current DPHHS child care license. Contact the DPHHS Economic Stability Division for the provider enrollment process – it is separate from the child care licensing process but runs through the same agency. Billings, Missoula, Great Falls, and Bozeman all have local Best Beginnings coordinators who can assist with the provider enrollment process.

Montana Child Care Market: Where the Demand Is

Bozeman / Gallatin County: The fastest-growing community in Montana by most measures. Montana State University (~17,000 students), a booming tech sector, and Yellowstone National Park gateway tourism bring young families in larger numbers than the child care market can currently absorb. Infant waiting lists at licensed centers routinely exceed one year. Gallatin County also has some of the highest household incomes in the state, supporting both private-pay and STARS-aligned models. A well-run center in Bozeman can charge $2,000+ per month per infant – but facility costs are also the highest in Montana.

Missoula / Missoula County: Home to the University of Montana (~12,000 students), Missoula is a progressive, education-oriented community with strong demand for high-quality early childhood education. University faculty and staff, hospital employees (Providence St. Patrick Hospital), and the outdoor recreation sector workforce all generate consistent full-time child care demand. The Missoula market is competitive but has meaningful unmet demand, particularly for infant slots.

Billings / Yellowstone County: Montana’s largest city (~120,000), anchored by the ExxonMobil and CHS refineries, Billings Clinic, and SCL Health St. Vincent medical center. The healthcare sector alone generates substantial demand for early-morning and irregular-hours child care. Billings also has Montana’s largest concentration of Best Beginnings-eligible families, making a Best Beginnings-approved center viable at scale.

Great Falls / Cascade County: Malmstrom Air Force Base (341st Missile Wing) brings a large military family population with relatively frequent household turnover, creating consistent demand for full-time child care from families who cannot always access base services. Military families may also access federal Child Care Aware fee assistance in addition to Best Beginnings, making Great Falls a dual-subsidy market worth understanding.

Helena / Lewis and Clark County: The state capital has steady demand from state government workers, attorneys, and nonprofit sector employees. Smaller market overall but low competitive density and stable family incomes. Child Care Centers serving Helena’s downtown corridor have benefited from the recent growth in state agency headcount.

Kalispell / Flathead County and Whitefish area: Glacier National Park tourism brings seasonal economic growth, but the year-round population in the Flathead Valley also supports licensed centers. Remote workers from coastal metros moving into Kalispell and Whitefish have elevated household incomes and strong demand for quality early childhood programs.

Eastern Montana (Sidney, Glendive, Williston corridor): The Bakken oil patch extending from North Dakota into Richland and Dawson counties generates higher-than-average household incomes for a rural area, with oil and gas shift workers needing non-standard-hours child care. This is a niche market with very limited licensed competition – Family Child Care Homes and Group Homes may be more practical here than full centers given the population density.

Tribal communities: Montana has seven federally recognized tribes. Head Start and Early Head Start programs serve many tribal children, but licensed child care capacity is often limited in reservation communities. Tribal CCDF funds flow through the tribes themselves and are separate from the state Best Beginnings Scholarship program. If you are planning a center near a tribal community or on tribal land, engage the tribe’s early childhood office early in the planning process.

Cost to Start a Daycare in Montana

Item	Family/Group Home	Child Care Center (24 children)
LLC formation	$35	$35
Child Care Facility License	Contact DPHHS (406) 444-2012	Contact DPHHS (406) 444-2012
Background checks (per staff member)	Free (Spark Montana FBI fingerprinting)	Free x 5-10 staff
CPR / first aid certifications (per staff)	$50-$150	$250-$750 (5+ staff)
Facility lease deposit + first month	N/A (home-based)	$3,000-$15,000 (varies by market)
Build-out, safety upgrades, playground fencing	$1,000-$5,000	$10,000-$60,000+
Cribs, furniture, educational materials, equipment	$2,000-$8,000	$8,000-$30,000
General liability insurance (annual, NCCI 9059)	$800-$1,800	$1,500-$4,500
Workers’ compensation insurance (annual)	$500-$1,500	$2,000-$6,000
Local business license	$25-$75	$50-$150
Marketing (website, Google Business Profile, flyers)	$200-$1,000	$1,000-$4,000
Working capital (3-month cushion)	$5,000-$15,000	$20,000-$50,000
Estimated Year 1 Total	$9,610-$32,525	$46,335-$171,435

These figures are highly variable based on whether you are leasing existing purpose-built space versus converting a commercial space to meet ARM Title 37 standards, and whether you are operating in Bozeman (high lease rates) versus Great Falls or Helena (lower). Infant-heavy centers cost more per square foot to staff and equip – plan your infant-to-toddler-to-preschool ratio for the economics of your specific market before signing a lease.

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Frequently Asked Questions

Who licenses daycares in Montana?

The Montana Department of Public Health and Human Services (DPHHS), Early Childhood and Family Support Division, Child Care Licensing (CCL) program licenses and regulates all child care facilities in Montana under ARM Title 37. Contact CCL at (406) 444-2012 or childcarelicensing@mt.gov. CCL oversees Family Child Care Homes, Group Child Care Homes, and Child Care Centers, as well as Family, Friend, and Neighbor (FFN) providers.

What are the staff-to-child ratios for Montana daycares?

Per ARM 37.95.623 for Child Care Centers: 1:4 for infants ages 0-23 months (max group size 12); 1:8 for children ages 2-3 (max group size 16); 1:10 for 4-year-olds (max group size 24); and 1:14 for children age 5 and older (max group size 32). These ratios must be maintained at all times during operating hours, including nap time and outdoor play. Family Child Care Homes are limited to a maximum of 8 children with no more than 3 under age 2.

How much does a Montana child care license cost?

DPHHS does not publicly post a child care licensing fee schedule on their website. The fee varies by license type and is confirmed during the application intake process. Contact DPHHS CCL at (406) 444-2012 or childcarelicensing@mt.gov before submitting your application to confirm current fees for your specific license type.

What background checks are required for Montana daycare workers?

All owners, operators, employees, volunteers with unsupervised child access, and adult household members at a Family Child Care Home must complete: (1) a Montana name-based criminal history check; (2) an FBI fingerprint background check – required for anyone who has lived outside Montana at any point in the past 5 years (free at Spark Montana locations statewide); (3) Montana Sex Offender Registry check; and (4) a Child Protective Services history check for Montana and any other state of past 5-year residence. Background checks must be repeated annually.

What is the STARS to Quality rating and is it required?

STARS to Quality is Montana’s voluntary 5-level quality rating and improvement system (Pre-Star + Stars 1-5) for licensed child care programs. It is not required for licensure. As of May 2026, STARS to Quality is in a full redesign and is not accepting new center ratings. The projected relaunch is October 1, 2026. Once relaunched, higher STARS ratings typically unlock higher Best Beginnings Scholarship reimbursement rates and serve as a marketing differentiator for families.

What is the Best Beginnings Child Care Scholarship?

The Best Beginnings Child Care Scholarship is Montana’s implementation of the federal Child Care and Development Fund (CCDF) subsidy program. It pays licensed providers directly for enrolled children from qualifying families. In 2023, the income eligibility threshold was expanded from 150% to 185% of the Federal Poverty Level. To accept Best Beginnings-funded children, your facility must hold a current DPHHS child care license and be enrolled as an approved Best Beginnings provider through the DPHHS Economic Stability Division.

Does Montana require daycare workers to be vaccinated?

Yes. All child care staff must have current documentation of Tdap (tetanus, diphtheria, pertussis) and MMR (measles, mumps, rubella) vaccinations on file at the facility. Documentation must be presented during DPHHS CCL licensing inspections. Staff who cannot receive certain vaccines due to documented medical contraindications may be eligible for exemptions – contact DPHHS CCL at (406) 444-2012 for the current exemption process.

Do I need workers’ compensation insurance for a daycare in Montana?

Yes. Montana requires workers’ compensation coverage for any employer with one or more employees. Child care workers are classified under NCCI code 9059. Coverage can be obtained through a private insurer or through Montana State Fund. Coverage must be in place before your first employee begins work, and proof of coverage is required as part of the DPHHS licensing application.