Last updated: May 3, 2026

How to Start a Daycare in Maryland (2026)

Three things make starting a daycare in Maryland different from neighboring states. First, the licensing agency is the Maryland State Department of Education (MSDE) — specifically the Office of Child Care within the Division of Early Childhood — not the Department of Human Services. Maryland transferred child care licensing from DHR to MSDE years ago, and MSDE administers it through 10 Regional Licensing Offices that cover all 24 Maryland jurisdictions (23 counties plus Baltimore City). Second, Maryland uses three distinct license types under three different chapters of COMAR Title 13A — Family Child Care Registration (13A.18), Letter of Compliance (13A.17), and Child Care Center License (13A.16) — each with different scope, ratios, training, and physical space rules. Third, Maryland’s Child Care Scholarship (CCS) program temporarily stopped accepting new family applications on May 1, 2025, which directly affects new providers’ ability to count on subsidy revenue from new families during 2026 — verify the program’s current enrollment status before signing your lease.

Maryland is also one of the most expensive child care markets in the country, with Montgomery County, Howard County, and Prince George’s County consistently ranking among the top 5% of US counties for child care cost. That creates two-sided pressure: high revenue per child, but also high family demand for affordable options that strains the CCS-subsidized provider tier. This guide covers MSDE Office of Child Care licensing, COMAR 13A.16/17/18 requirements, ratios, training, Maryland EXCELS quality ratings, CCS, and the regional licensing office structure.

Maryland Daycare Requirements at a Glance

Requirement	Agency / Source	Cost	Timeline
Family Child Care Registration (≤8 children)	MSDE Office of Child Care under COMAR 13A.18	$0 application; $50-75 typical fee schedule	2-year validity; 60-90 days from application
Letter of Compliance (public/non-profit)	MSDE Office of Child Care under COMAR 13A.17	$0 application	2-year validity
Child Care Center License (>8 children)	MSDE Office of Child Care under COMAR 13A.16	$0 application; capacity-tied fees vary	2-year validity; 90-180 days from application
State + FBI fingerprint-based criminal history check	Maryland CJIS-Central Repository / FBI / OCC Background Check Unit	$50-65 per check (varies by vendor)	2-4 weeks
Pre-Service Training (centers)	MSDE-approved trainers	$300-1,200 depending on courses	90+ hours for directors
Pre-Service Family Child Care Training	MSDE-approved trainers	$200-400	24 hours
Maryland EXCELS Enrollment	Maryland EXCELS	Free participation	Self-paced rating progression
Child Care Scholarship (CCS) Provider Registration	MSDE Provider Portal	Free	Subject to current CCS enrollment status
SDAT LLC formation	Maryland Business Express	$100 standard / $150 expedited	Same-day expedited
Workers’ Compensation Insurance	Private carrier or CEIWC	Class-code based; daycare is moderate risk (NCCI 9059)	Required at 1st employee
General Liability Insurance with child care endorsement	Private carrier	$2,000-7,000/year typical	Required for licensure

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

Step 1: Pick Your License Type Under COMAR 13A.16, 13A.17, or 13A.18

Maryland’s three child care license types live in three different COMAR chapters under MSDE’s Division of Early Childhood:

Family Child Care Registration (COMAR 13A.18)

• Capacity: Up to 8 children, including the provider’s own children under age 6 (with conditions). Most FCC providers operate at the 8-child max
• Setting: Provider’s residence or another residential dwelling
• Lower training threshold: 24-hour Pre-Service Family Child Care Training plus ongoing CE
• Lower regulatory burden: No center-style facility requirements; existing residential space adapted
• Best fit: Solo provider or provider plus 1 helper, infant/toddler-focused, established neighborhood demand

Child Care Center License (COMAR 13A.16)

• Capacity: Over 8 children; no upper cap (capacity set by physical space and staffing)
• Setting: Non-residential commercial or institutional space
• Director credential required: 90 Hour Pre-Service Training plus director qualifications
• Full COMAR 13A.16 compliance: Square footage, staffing patterns, fire safety, food prep, sanitation
• Best fit: Multi-classroom programs, faith-based programs, employer-sponsored programs, school-readiness centers

Letter of Compliance (COMAR 13A.17)

• Eligible operators: Public agencies, public schools, certain non-profits, recreation programs
• Different requirements track from full license but same OCC oversight and inspections

Step 2: Complete Pre-Service Training

Maryland requires several pre-service training components before licensure or registration:

Required Training	Hours	Required For
90 Hour Pre-Service Training	90	Center directors and senior staff
Pre-Service Family Child Care Training	24	FCC providers
Basic Health and Safety Training (BHST)	~10	All staff
Medication Administration Training (MAT)	6	Anyone administering medication
Pediatric CPR / First Aid	4-8	All program staff
SIDS / SUID prevention training	1-2	Staff working with children under 12 months
Breastfeeding-friendly training	1	Programs serving infants

The Maryland Child Care Credential Program recognizes professional growth through credential levels. Note: Maryland Child Care Credential Program is not accepting new applications between July 1, 2024 and June 30, 2026 while MSDE redesigns the program — current credential holders maintain status, but new applicants are paused.

Step 3: Complete Background Checks

Maryland requires multiple background-check streams before approval:

• State criminal history (CJIS Central Repository) — fingerprint-based
• FBI criminal history — fingerprint-based
• Maryland Child Protective Services (CPS) clearance
• Maryland Sex Offender Registry check
• Out-of-state checks if the applicant has lived in another state in the past 5 years

For family child care, all household members 18+ must clear all checks. For centers, all staff and any volunteer with regular unsupervised access must clear all checks. Disqualifying offenses include violent felonies, child abuse, drug felonies (within 5 years), and sex offenses.

Step 4: Meet Facility and Equipment Requirements

Requirement	Standard (COMAR 13A.16/17/18)
Indoor space	35 square feet per child (usable activity space, excluding bathrooms, kitchens, hallways)
Outdoor play space	75 square feet per child (or scheduled use of nearby playground)
Fencing	4-foot minimum, condition-appropriate
Diaper-changing area	Separated from food preparation; sanitization between changes
Sleep arrangements	Cribs for infants meeting CPSC standards; separate cots/mats for older children
Hand-washing stations	Accessible to children; separate from diaper changing
Food preparation	Compliant with local health department for any meal prep beyond reheating
Fire safety	Annual fire marshal inspection; smoke detectors; egress routes

Step 5: Comply With Maryland Adult-to-Child Ratios

Age Group	Ratio	Group Size Cap
Infants (6 weeks – 18 months)	1:3	6 (2 staff)
Toddlers (18 months – 2 years)	1:6	12 (2 staff)
Preschool (2 – 4 years)	1:10	20
School-age (5+ years)	1:15	30

Maryland’s 1:3 infant ratio is among the most stringent in the country — many states allow 1:4 or 1:5. The 1:6 toddler and 1:10 preschool ratios are also tighter than national averages. Plan staffing budgets accordingly: an infant room with 6 babies requires 2 full-time caregivers, not 1.

Step 6: Submit Your Application Through MSDE Office of Child Care

Submit through the MSDE Division of Early Childhood Provider Portal or directly to your Regional Licensing Office. Maryland’s 10 Regional Licensing Offices serve all 24 jurisdictions — locate yours through MSDE’s regional office map. After submission, expect:

• Application review (4-8 weeks)
• Pre-licensure facility inspection by an OCC licensing specialist
• Fire marshal and (in some jurisdictions) health department sign-offs
• License or registration issued for a 2-year period

Step 7: Enroll in Maryland EXCELS

The Maryland EXCELS quality rating system has been operating since 2013. Programs progress through Levels 1-5 by demonstrating standards across:

• Licensing and Compliance (Level 1 baseline)
• Staff Qualifications and Professional Development
• Accreditation and Rating Scales (ECERS-3, ITERS-3, FCCERS-3, SACERS-Updated)
• Developmentally Appropriate Learning and Practice
• Administrative Policies and Practices

EXCELS rating directly affects CCS reimbursement rates — Level 4 and Level 5 programs receive higher per-child rates than Level 1-3 programs serving the same age group. EXCELS also unlocks eligibility for Maryland State Department of Education quality improvement grants and incentive payments.

Step 8: Register for Child Care Scholarship (CCS) Provider Participation

To accept families using Maryland’s Child Care Scholarship subsidy, register through the MSDE Provider Portal. Reimbursement rates for 2026 are set at the 60th percentile of the 2024 Market Rate Survey, varying by:

• Region — the state is divided into multiple market regions; Montgomery/Howard/PG and Baltimore City command the highest rates
• Age group — infant care reimburses highest, school-age lowest
• Provider type — center vs. FCC vs. large FCC vs. Letter of Compliance
• EXCELS rating — higher rating = higher rate

2025-2026 enrollment alert: The CCS program temporarily stopped accepting new family applications May 1, 2025. Existing CCS-enrolled families and providers continue, but new families could not be added during the pause. Verify the current status with MSDE before counting on subsidy-eligible families filling new openings.

Maryland Daycare Operating Costs and Revenue

Item	Family Child Care	Center (40-child capacity)
SDAT LLC formation	$100	$100
Annual SDAT Personal Property Return	$300 (waived w/ MarylandSaves)	$300 (waived w/ MarylandSaves)
Pre-Service training	$200-400 (24 hrs)	$1,000-2,500 (90 hrs director + staff)
Background checks (per person)	$50-65 each	$50-65 each (all staff)
Facility setup	$5,000-15,000 (residential adaptation)	$50,000-300,000 (commercial buildout)
General liability insurance	$1,200-2,500/year	$3,500-8,000/year
Workers’ comp (NCCI 9059)	$0-1,200/year (depending on payroll)	$5,000-15,000/year
Annual rent (Maryland market dependent)	$0 (home-based)	$30,000-150,000+ (Montgomery/Howard premium)
Tuition revenue per infant slot/year	$15,000-22,000	$18,000-30,000+ (Montgomery/Howard County)

Maryland Daycare Market: Where the Demand Is

• Montgomery County — wealthiest US county by median income, severely supply-constrained for infant care, average infant tuition over $25,000/year. Bethesda, Rockville, Silver Spring, Gaithersburg are particularly underserved. Federal contractor demographic creates stable demand
• Howard County (Columbia) — fastest-growing demographic of any Maryland county for under-5 population; high-income tech and federal workforce; Columbia’s planned-community structure created intentional child care infrastructure but waitlists remain long
• Prince George’s County — large federal workforce, large Hispanic and immigrant populations creating bilingual/multicultural care demand. PG County Department of Health and OCC inspectors are particularly active on safety standards
• Baltimore City — Johns Hopkins, MICA, federal court, Department of Defense Baltimore offices drive professional family demand; lower median income than the DC suburbs but more concentrated demand around Hopkins/Federal Hill/Canton/Locust Point
• Anne Arundel County — Naval Academy, Fort Meade, BWI airport workforce; Annapolis state government; strong year-round demand
• Frederick County — fastest-growing population in Maryland; lower cost basis than Montgomery County; large commuter base servicing both DC and Baltimore metros
• Eastern Shore — much lower demand density; seasonal Ocean City workforce drives summer-only demand patterns; Salisbury area has Perdue/poultry workforce concentration

Maryland Daycare Distinctive Operating Considerations

1. Maryland EXCELS rating drives revenue. A Level 5 center serving CCS-eligible infants in Montgomery or Howard County captures roughly 30-50% more per-child reimbursement than a Level 1 or unrated program. Targeting Level 3 minimum within 18 months of opening should be in your business plan.

2. The 1:3 infant ratio limits scalability. Two FT staff are needed for an infant classroom of 6, three are needed for a classroom of 9 (capped at 6 per group anyway). The math means infant rooms operate at lower margin per square foot than preschool rooms — the highest-revenue room (infant tuition) is also the highest-cost room (2 staff for 6 babies).

3. CCS pause affects new providers most. Existing providers retain their existing CCS-subsidized families, but new providers in 2026 cannot count on subsidy revenue from new families until MSDE reopens enrollment. Plan for full-private-pay revenue during the first 6-12 months and verify CCS status quarterly.

4. Multi-county minimum wage matters at higher staffing levels. Montgomery County’s $15.50-$17.65 minimum wage by employer size hits centers hard once you cross 11 or 51 employees. A Bethesda center with 51+ employees (large center model) pays $17.65/hour minimum to all staff (vs. $15.00 in Frederick across the line). Plan staffing strategy accordingly.

5. Maryland Healthy Working Families Act sick leave applies. All Maryland daycare employers must provide accrued sick and safe leave (paid for 15+ employee programs, unpaid for under-15). Center directors should code 1 hour per 30 hours worked into payroll software from day one.

Cost to Start a Daycare in Maryland

Phase	Family Child Care	Small Center (24 children)	Mid-size Center (40+)
License + training + background checks	$500-1,200	$2,000-4,000	$3,000-6,000
SDAT formation + first $300 SDAT fee	$400	$400	$400
Facility setup / build-out	$5,000-15,000	$30,000-100,000	$100,000-400,000
Equipment, toys, materials, classroom supplies	$3,000-8,000	$15,000-40,000	$40,000-100,000
Insurance (first year)	$1,200-2,500	$3,500-7,000	$5,000-12,000
Working capital (3 months pre-revenue)	$5,000-10,000	$30,000-75,000	$60,000-200,000
Total launch range	$15,000-37,000	$80,000-225,000	$210,000-720,000+

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Frequently Asked Questions

What agency licenses daycares in Maryland?

The Maryland State Department of Education (MSDE) Office of Child Care, within the Division of Early Childhood, licenses all child care in Maryland under COMAR 13A.16 (centers), 13A.17 (Letters of Compliance), and 13A.18 (family child care). Maryland transferred child care licensing from the Department of Human Resources (DHR) to MSDE, making Maryland one of the few states housing child care licensing inside its education department rather than its human services agency. MSDE administers the system through 10 Regional Licensing Offices that cover all 24 Maryland jurisdictions.

What are Maryland’s required adult-to-child ratios for daycare?

Maryland’s adult-to-child ratios under COMAR 13A.16 are: 1:3 for infants (6 weeks to 18 months), 1:6 for toddlers (18 months to 2 years), 1:10 for preschool-age (2-4 years), and 1:15 for school-age (5+). Centers must provide at least 35 square feet of indoor space per child and 75 square feet of outdoor play space per child. The 1:3 infant ratio is among the most stringent in the country.

What is Maryland EXCELS?

Maryland EXCELS is the state’s quality rating and improvement system, operating since 2013, that rates licensed child care and early education programs Levels 1 through 5. Standards cover program administration, staff qualifications and professional development, classroom environment, and family/community engagement. Higher EXCELS ratings unlock higher Child Care Scholarship (CCS) reimbursement rates and eligibility for state grants.

How does the Maryland Child Care Scholarship (CCS) program work?

CCS is Maryland’s child care subsidy program for working/studying low- and moderate-income families. Initial income eligibility is set at 75% of State Median Income (SMI); families can continue receiving CCS up to 85% SMI. Provider reimbursement is set at the 60th percentile of the Market Rate Survey, varying by region, age group, provider type, and EXCELS level. Important: CCS temporarily stopped accepting new family applications on May 1, 2025; verify current enrollment status before counting on subsidy revenue from new families.

What’s the difference between Family Child Care Registration and a Center License in Maryland?

Family Child Care Registration under COMAR 13A.18 covers home-based care for up to 8 children, with a 24-hour pre-service training requirement. Child Care Center License under COMAR 13A.16 covers any program over 8 children operating in a non-residential facility, with a 90-hour pre-service requirement for directors and full COMAR 13A.16 facility compliance. Letter of Compliance under COMAR 13A.17 applies to programs operated by public agencies, public schools, and certain non-profits.

Do I need workers’ compensation for my Maryland daycare?

Yes. Maryland requires workers’ compensation insurance for any employer with 1 or more employees under MD Code, Lab. & Empl. § 9-101. This applies the moment you hire a teacher, assistant, or even a part-time substitute. Family child care providers caring only for related children typically have no employees, but anyone hiring outside help triggers the workers’ comp requirement. Purchase from any Maryland-licensed carrier or from Chesapeake Employers Insurance (CEIWC), the state insurer of last resort. Daycare workers’ comp class code is NCCI 9059 (moderate risk).