How to Start a Daycare in Vermont (2026)

Last updated: May 4, 2026

Two things make Vermont’s childcare licensing system stand apart from most states. First, Vermont charges no fee to apply for, receive, or renew a childcare license — the Child Development Division (CDD) absorbs that cost, which means your licensing budget goes toward training and facility preparation rather than government fees. Second, Vermont’s infant-to-staff ratio of 1:4 applies through 24 months of age (not 18 months as some outdated guides state), which affects your staffing math from day one for the birth-to-two cohort that commands the highest parent demand in Vermont’s university and resort markets.

Vermont is one of the few states where demand for infant slots consistently exceeds supply. Burlington’s University of Vermont (UVM) community, the IBM/GlobalFoundries campus in Essex Junction, and the growing Burlington tech sector generate persistent waitlists at quality infant programs. In ski and resort communities — Stowe, Killington, Sugarbush — seasonal workforce childcare needs spike every November through April. The Vermont Child Care Financial Assistance Program (CCFAP) helps moderate-income families access care, broadening your potential client base beyond full-pay families. This guide uses current Vermont DCF sources for 2026.

Daycare / Childcare Requirements in Vermont at a Glance

Requirement	Agency / Source	Cost	Timeline
LLC Formation	Vermont Secretary of State — bizfilings.vermont.gov	$155	~1 business day online
Annual Report	Vermont Secretary of State	~$35/year (verify at sos.vermont.gov/corporations/fees/)	Within 3 months of fiscal year end
Childcare License	Vermont DCF — Child Development Division	Free (no application or renewal fee)	60-90 days for Phase I-III; license valid 3 years
Background Check + Fingerprinting (all staff)	Vermont Criminal Information Center (VCIC) via CDD	Covered by CDD — no direct cost to applicant	2-6 weeks; renew every 5 years
Pediatric CPR and First Aid Certification	AHA, Red Cross, or equivalent accredited provider	$50-$150 per person	Must be current before license is issued
Director Qualification Verification	Vermont DCF / CDD	No fee	Reviewed during Phase II application
CDD Compliance Inspection	Vermont DCF / CDD	No fee	Scheduled after Phase I clearance
Workers’ Compensation Insurance	Vermont Department of Labor (mandatory at 1 employee)	Varies by payroll; private carrier required	Must be in force before first employee starts
STARS Enrollment (optional)	Vermont DCF — STARS program	No fee	Voluntary; enroll after license issued

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

Step 1: Determine Your License Type

Vermont’s Child Development Division issues four main types of childcare licenses. Your choice affects capacity limits, ratio requirements, director qualifications, and facility standards:

Registered Child Care Home

Home-based operation serving up to 6 children year-round (may include the provider’s own children depending on age). Requires registration with CDD, background checks, and basic health and safety standards — less intensive than full licensure but still involves VCIC checks and CDD review. The most accessible entry point for in-home providers.

Licensed Child Care Home

Home-based program serving up to 12 children year-round, or up to 14 during summer months when school is not in session. Full licensure with background checks, inspections, and director qualifications. The most common home-based category for providers seeking to serve more families.

Licensed Center-Based Program

Facility-based program serving 13 or more children year-round. Subject to the most comprehensive regulatory framework, including director qualifications, staff-to-child ratios, indoor and outdoor space requirements, and full three-phase licensing. This is the standard path for standalone childcare centers and employer-sponsored programs.

After-School Program

Serves school-age children (age 5 and up) before and after school hours and during school vacations. Different ratios and director qualifications apply than for center-based programs serving younger children. Contact CDD to confirm if your specific program structure qualifies as a licensed after-school program.

Exemptions

Relatives caring for children in their own homes and certain religious organization programs meeting specific criteria may be exempt from licensing. Contact CDD at 800-649-2642 before assuming an exemption applies to your situation.

Step 2: Pre-Application Consultation with the Vermont CDD

The Child Development Division’s licensing specialists are genuinely helpful before you commit to a lease or purchase. Contact them first:

• Phone: 800-649-2642 (option 3)
• Email: AHS.DCFCDDChildCareLicensing@vermont.gov
• Website: dcf.vermont.gov/cdd/providers/become/licensed
• Application system: Vermont Bright Futures Information System (BFIS) — CDD provides access instructions

A licensing specialist will review your proposed program, identify which license type fits, explain current Phase I-III requirements, and answer site-specific questions. Vermont’s childcare regulations have been updated through significant state investment in recent years, so confirm directly with CDD rather than relying solely on third-party summaries.

Step 3: Form Your Business Entity

Most childcare center operators form an LLC for liability protection. File Articles of Organization online at bizfilings.vermont.gov for $155. Online processing takes approximately one business day. Get a free Employer Identification Number (EIN) from the IRS at irs.gov — required for banking and payroll. Open a dedicated business bank account immediately to keep business finances separate from personal accounts.

Your business entity registration is a required document in Phase I of the licensing process. Nonprofit status is common among larger childcare centers participating in state subsidy programs, but for-profit LLCs are fully eligible for all Vermont childcare licenses and CCFAP participation.

Step 4: Phase I — Background Clearance and Documentation

Phase I of Vermont’s three-phase licensing process must be completed before you schedule your facility inspection. Phase I covers:

Criminal Background Checks for All Staff

Vermont requires criminal record checks through the Vermont Criminal Information Center (VCIC) for all providers, directors, and staff members who have unsupervised contact with children. The CDD coordinates this process and covers the cost — you do not pay a separate background check fee. Background checks must be renewed every five years. Fingerprint-based checks are required in addition to the name-based VCIC check. The CDD provides instructions for fingerprinting scheduling after your initial consultation.

Out-of-State Background Checks

If any applicant or staff member has lived outside Vermont in the past five years, out-of-state criminal history checks may also be required. CDD will advise you on this during consultation.

Background Check Disqualifiers

Certain criminal convictions automatically disqualify a person from working in Vermont licensed childcare settings. The CDD reviews other convictions on a case-by-case basis. Contact CDD at 802-649-2642 before investing time in the application if you or any key staff member has a prior conviction.

Financial Documentation

Basic financial documentation showing you have the resources to fund startup and initial operating costs is reviewed in Phase I. Vermont does not require a detailed business plan submission for most applicants, but financial viability is considered.

Minimum Age Requirements

Directors of center-based programs must be at least 21 years old. Licensed family child care home providers must be at least 18 years old.

Step 5: Prepare Your Facility

Vermont’s facility standards are enforced during the Phase II inspection. Meeting them before your inspection date avoids delays and re-inspections:

Indoor Space

Center-based programs must provide a minimum of 35 square feet of usable indoor space per child. Usable space excludes bathrooms, storage rooms, hallways, and areas not directly accessible to children during activities. For a 20-child preschool program, this means at least 700 square feet of actual activity area — not total building square footage.

Outdoor Play Space

Minimum 75 square feet of usable outdoor space per child, safely enclosed by fencing or natural barriers. The space must meet Vermont safety standards for equipment, surfacing under play structures, and general hazard-free conditions. Urban programs with limited outdoor access should contact CDD early to discuss alternatives.

Infant Sleep Safety

Vermont requires safe sleep compliance for all infants in care. Each infant must have their own approved crib, bassinet, or play yard with a firm, flat mattress and no soft bedding. The crib cannot be shared between infants. Safe sleep practices must be documented in your written policies.

Safety and Health Infrastructure

Working smoke detectors in all rooms, carbon monoxide detectors, fire extinguishers with current inspection tags, a dedicated handwashing sink separate from food preparation areas, and properly secured hazardous materials storage are all required before CDD will issue a license. If your space requires modifications, secure all local building permits before scheduling your CDD inspection.

Step 6: Phase II — Application Submission and CDD Inspection

Director Qualifications (Center-Based Programs)

The director of a Vermont licensed center-based program must hold a Vermont Early Childhood Career Ladder Level 4A or 4B Certificate, or equivalent educational credentials with relevant experience. The Vermont Career Ladder is administered by the Vermont Northern Lights Career Development Center. Level 4 requires a minimum of an Associate’s degree in early childhood education or child development (or related field with ECE coursework) plus documented experience. CDD verifies director qualifications during Phase II — confirm whether your credentials qualify before applying, since meeting the director qualification is often the longest lead time item in the process.

Health and Safety Training

All providers must complete required health and safety trainings before the license is issued. Pediatric first aid and CPR certification (through an accredited provider such as the American Heart Association or American Red Cross) is required for all providers and must be current. Cost is typically $50-$150 per person per training cycle. Renewal schedules vary by certifying body (typically every 2 years for CPR).

Policies and Procedures Documentation

A written parent handbook, discipline policy (prohibiting corporal punishment explicitly), emergency procedures, health and illness policies, and safe sleep policies must all be reviewed and approved during Phase II. CDD licensing specialists can provide current template guidance during your pre-application consultation.

The CDD Compliance Inspection

A CDD licensing specialist conducts an on-site inspection of your facility against Vermont childcare regulations. The inspection covers facility space and safety, equipment, staffing documentation, written policies, and director qualification verification. Schedule the inspection after your application is reviewed — do not schedule the inspection before your application is submitted and Phase I background clearances are complete.

Step 7: Phase III — License Issuance

After all Phase II requirements are verified and any deficiencies corrected, the CDD completes the final licensing determination. Your license is issued with a three-year validity period. There is no renewal fee. Renewal notices are sent approximately 60 days before expiration.

Vermont childcare licenses are publicly posted through the CDD’s childcare finder tool, which families use to verify license status and capacity. Your license posting is your public-facing credibility signal in Vermont’s competitive childcare market.

Staff-to-Child Ratios (Center-Based Programs)

Age Group	Maximum Ratio	Maximum Group Size
Infants (birth to 24 months)	1:4	8
Toddlers (24 to 36 months)	1:5	10
Preschool (3 to 5 years)	1:10	20
School-age (5 and older)	1:13	26

These ratios apply during all operating hours when children are present, including transition periods. You must staff to these ratios even when some children are sleeping or in outdoor play. Plan your staffing schedule to maintain ratios during arrival, departure, nap, meals, and outdoor time — these are the moments where ratio compliance is most commonly cited in Vermont CDD inspections.

Vermont STARS Quality Rating System

Vermont’s voluntary quality recognition program is the STep Ahead Recognition System (STARS), a 5-tier (1-5 star) system administered by the CDD. STARS participation is not required for licensing, but it supports access to professional development resources, mentoring, and recognition by families researching quality care.

As of 2022, STARS administration transferred to CDD from the former Child Care Resource organizations. In 2023, STARS underwent a redesign shifting toward a continuous quality improvement model. Importantly, as of 2026, STARS ratings are no longer used to determine CCFAP payment rates — that financial link was severed to address concerns about inequity between providers with more and fewer resources to pursue ratings. STARS participation now focuses on professional development and public recognition rather than payment tier access.

Contact Vermont DCF for current STARS enrollment information: dcf.vermont.gov/cdd/providers/care/STARS

Vermont Child Care Financial Assistance Program (CCFAP)

The Child Care Financial Assistance Program (CCFAP) provides state subsidies that help income-qualifying Vermont families pay for childcare. As a licensed provider, you can enroll as a CCFAP-participating provider and accept subsidy families, which expands your potential client base significantly beyond full-pay families in a high-cost state.

Vermont substantially expanded CCFAP eligibility and payment structures in recent years as part of a major state investment in childcare access. Income guidelines were updated most recently in March 2026. Families are assigned a “family share” copayment amount; the state pays the provider the difference up to the market rate. Contact the CDD or the Agency of Human Services for current CCFAP enrollment information for providers: dcf.vermont.gov/benefits/ccfap

Payroll Compliance: Minimum Wage, VESL, and Workers’ Compensation

Vermont’s minimum wage is $14.42 per hour effective January 1, 2026, up from $14.01 in 2025. Vermont’s minimum wage is indexed to the Consumer Price Index annually under 21 V.S.A. § 384 — expect another increase on January 1, 2027. Tipped employees have a $7.21 minimum (with tips bringing total to $14.42 or more). Childcare workers are not tipped, so the full $14.42 applies to all staff.

Vermont’s Earned Sick Time (VESL) law under 21 V.S.A. § 481 requires employers to allow employees who work an average of at least 18 hours per week to accrue paid sick leave at a rate of one hour per 52 hours worked, capped at 40 hours per year. For a full-time daycare teacher working 40 hours per week, that means accruing approximately 40 hours of sick leave over the year. Budget for VESL-covered absences in your staffing plan — childcare facilities are particularly vulnerable to cascading absences when illness circulates through staff.

Workers’ compensation is mandatory for any Vermont employer with one or more employees. Childcare is physically demanding and involves exposure to childhood illnesses and injury risk from active children. Purchase coverage from a licensed private carrier before your first employee begins work. Contact the Vermont Department of Labor at labor.vermont.gov/workers-compensation or 802-828-2286 for carrier referrals and coverage requirements.

Vermont Family and Medical Leave Insurance (VT-FAMLI)

Vermont launched its voluntary Family and Medical Leave Insurance program (VT-FAMLI) in 2023 through a state contract with The Hartford as the program’s insurer. Unlike Massachusetts, Colorado, Washington, and other states with mandatory PFML programs, Vermont’s VT-FAMLI is voluntary for private-sector employers. There is no payroll deduction requirement and no employer mandate.

Individual enrollment (Phase 3) opened May 1, 2025, allowing individual Vermont workers to opt into coverage. Benefits became available to enrolled individuals starting January 1, 2026. If you want to offer VT-FAMLI as a benefit to your childcare staff — which can be a meaningful recruitment differentiator in the tight childcare labor market — contact The Hartford or visit governor.vermont.gov/vtfmli for current enrollment details and premium information for private employers.

Vermont Daycare Market: Where the Demand Is

Vermont has one of the most documented childcare shortages in the country relative to its population. The Vermont Child Care Industry Report consistently identifies infant care as the most acute gap — infant slots require the most staff per child (1:4 ratio), generate the highest costs, and are most frequently cited as waitlisted by Vermont families.

Burlington and the Chittenden County corridor is Vermont’s largest market. Burlington is home to the University of Vermont (UVM), UVM Medical Center (the state’s largest employer), Vermont’s largest concentration of professional workers, and the state’s most active tech sector including BETA Technologies and legacy Dealer.com alumni. The IBM and GlobalFoundries semiconductor manufacturing campus in Essex Junction employs thousands of shift workers who need reliable, structured childcare outside typical 9-5 hours. Chittenden County also has the highest median household income in Vermont, supporting above-average childcare rates.

Montpelier (Washington County) is the state capital and home to state government workers, nonprofits, and the insurance industry cluster. Despite being the smallest state capital in the U.S. by population (~7,400), Montpelier has strong professional-class childcare demand with limited supply options.

Ski and resort communities (Stowe, Killington, Sugarbush, Mount Snow, Okemo) generate intense seasonal demand from resort workers who need childcare aligned with ski season schedules. A program serving resort area families can see capacity jump dramatically November through April and drop in summer. Some resort operators have explored employer-sponsored childcare programs as a workforce retention tool.

The Northeast Kingdom (Caledonia, Orleans, Essex counties) is Vermont’s most rural and economically challenged region. CCFAP participation is essential for providers here given income demographics. State and federal investments in rural childcare access have expanded in recent years.

Cost to Start a Daycare in Vermont

Item	Cost	Notes
LLC Formation	$155	Online at bizfilings.vermont.gov; ~1 business day
Annual Report (Year 1)	~$35	Verify current fee at sos.vermont.gov/corporations/fees/
Childcare License	Free	Vermont charges no application or renewal fee — unusual nationally
Background Checks	Covered by CDD	No direct cost; CDD coordinates VCIC and FBI fingerprinting
Pediatric CPR / First Aid	$50-$150 per person	Required for all providers; recurring per certification schedule
Facility Lease	Highly variable	Burlington commercial: $15-$25/sqft annually; rural VT significantly less
Facility Build-Out and Safety Upgrades	$5,000-$50,000+	Fencing, bathroom fixtures, crib equipment, smoke/CO detectors
Furniture, Equipment, and Learning Materials	$5,000-$30,000	Cribs, mats, toys, outdoor equipment, sensory materials
General Liability / Professional Liability	$1,500-$4,000/year	Strongly recommended; some licensing arrangements require it
Workers’ Compensation	Varies by payroll	Mandatory at 1 employee; childcare NCCI class 9059

Estimated total startup cost: $20,000-$120,000+ — home-based registered programs cost considerably less; licensed centers serving 20+ children in leased commercial space are at the high end.

Related Vermont Business Guides

• How to Start a Hair Salon in Vermont
• How to Start a Food Truck in Vermont
• How to Start a Cleaning Service in Vermont
• How to Start an HVAC Business in Vermont
• How to Start a Landscaping Business in Vermont
• How to Become a Private Investigator in Vermont

← Back to all Vermont business guides

Frequently Asked Questions

How much does a Vermont childcare license cost?

Vermont charges no fee to apply for or renew a childcare license — one of only a handful of states with this policy. Background checks are coordinated and covered by the Child Development Division. Your direct costs are CPR and first aid training ($50-$150 per person), facility preparation to meet safety standards, and the LLC filing fee ($155). Contact the CDD at 800-649-2642 or email AHS.DCFCDDChildCareLicensing@vermont.gov for current application requirements.

How long does it take to get a Vermont daycare license?

Plan for 60 to 90 days for the full three-phase process. Background check processing (Phase I) typically takes 2-6 weeks. Phase II application review and inspection scheduling adds several more weeks. Phase III license issuance follows. Programs with director qualification gaps or facility deficiencies take longer. Contact CDD at 800-649-2642 for a timeline estimate for your specific program type before signing a lease.

What are the staff-to-child ratios for Vermont daycare centers?

Vermont center-based programs must maintain: 1:4 for infants (birth to 24 months — not 18 months); 1:5 for toddlers (24 to 36 months); 1:10 for preschool (3-5 years, max group 20); 1:13 for school-age children (5 and older, max group 26). These are maximum ratios during all operating hours. The infant breakpoint at 24 months is a common source of error in third-party guides — confirm directly with CDD.

What qualifications does a Vermont daycare director need?

Directors of Vermont center-based programs must hold a Vermont Early Childhood Career Ladder Level 4A or 4B Certificate or demonstrate equivalent educational credentials plus relevant experience. Level 4 generally requires at minimum an Associate’s degree in early childhood education or child development with documented professional experience. Contact CDD at AHS.DCFCDDChildCareLicensing@vermont.gov to verify whether your credentials qualify — this is the most common bottleneck in the center licensing process.

Do Vermont daycare workers need background checks?

Yes. All providers and staff with unsupervised contact with children must complete state criminal background checks through the Vermont Criminal Information Center (VCIC) and fingerprint-based FBI checks, both coordinated by the CDD. These are required before the individual begins working with children and must be renewed every five years. The CDD covers the cost of these checks as part of the licensing process.

Is Vermont’s STARS quality rating required for daycare licensing?

No. Vermont’s STARS (STep Ahead Recognition System) 5-tier quality program is voluntary. A STARS rating is not required to obtain a childcare license or to participate in the Vermont Child Care Financial Assistance Program (CCFAP). As of 2026, STARS ratings are also no longer linked to CCFAP payment rates. STARS participation is available for professional development and public recognition purposes. For information: dcf.vermont.gov/cdd/providers/care/STARS.