Subject
title
Exploring Child Care Solutions to Meet Community Needs
end
Department
Recreation & Parks
Recommendation
Staff recommends that the Mayor and Council of Rockville review existing child care and youth programs, discuss shared objectives, review opportunities to expand child care access, and provide policy direction to guide future child care initiatives in the City of Rockville, Maryland.
Discussion
The Mayor and Council of Rockville (Mayor and Council) expressed interest in identifying solutions to meet the growing need for accessible and affordable child care. This work session serves as an opportunity to define the City of Rockville, Maryland’s (City) approach to expanding childcare services and support for working families through coordinated efforts across departments.
Community Planning and Development Services, Housing and Community Development, and Recreation and Parks have collaborated to align objectives and develop actionable strategies for this session. Staff will seek the Mayor and Council's guidance to help shape a coordinated, interdepartmental response to the increasing demand for childcare options in Rockville.
The work session presentation (Attachment 1) will cover the following topics:
Child Care Landscape in Montgomery County, Maryland
Montgomery County’s March 2024 Child Care Cost of Quality Study identified several regional challenges in childcare access:
• Only 17% of infants and toddlers are currently served by existing child care capacity.
• Sustainability concerns among high-quality child care providers.
• Pay disparities between community-based child care educators and public-school staff.
The study recommended six key strategies to improve access, educator pay, and financial viability through targeted grants, subsidies, and policy changes.
Link: Montgomery County Child Care Cost of Quality Study <https://www.montgomerycountymd.gov/HHS-Program/Resources/Files/FY25%20MoCo%20Cost%20of%20Quality%20Final%20Report.pdf>
Child Care and Youth Programs in the City of Rockville
Recreation and Parks (Rec and Parks) Programs:
The department operates a range of child care and youth programs for children under 13 and school-aged teens up to age 15, including:
• Licensed Child Care Programs such as Montrose Discovery Preschool and Twinbrook After School Club, which meet State of Maryland standards for health, safety, and child development.
• Weekday Out-of-School Programs are offered before and after school and during MCPS non-instructional days.
• Self-Regulated Summer Day Camps served over 4,800 participants across 194 camps at 26 locations in 2024.
Financial Assistance Programs include:
• Federal Child and Dependent Care Credit
• Maryland Child Care Scholarship Program (CCS)
• Montgomery County Working Parents Assistance Program (WPA)
• Rockville Youth Recreation Assistance Fund (Rec Fund)
Cost Recovery Framework (Tiers 1-4) is used to assess program subsidies and recoup both direct and indirect costs associated with regulatory programs and community and individual benefit services:
• Tier 1: Community Benefit (Target of 0% or greater)
• Tier 2: Considerable Community Benefit (Target of 20% to 50%)
• Tier 3: Balanced Community & Individual Benefit (Target of 30% to 70%)
• Tier 4: Considerable Individual Benefit (Target of 70% to 100%)
Housing and Community Development (HCD) Programs:
The department supports youth and families through targeted enrichment and financial assistance programs:
• Youth Mentoring and Development Programs focus on children from households experiencing higher poverty rates or who qualify for MCPS’ Free and Reduced-Price Meals (FARMS) program. These programs provide holistic care, enrichment, and socioemotional support, and partner with schools and nonprofit providers.
• Community Services and Enrichment Grants (FY26: $1.5 million across 39 programs) fund various services for youth, seniors, and families. Future grant cycles (FY27) are proposed to prioritize childcare access and support, including criteria to increase lower-cost or no-cost childcare options for City residents.
• Rockville Emergency Assistance Program (REAP): This program has a new childcare component effective FY26. Families facing eviction, utility shutoff, or other emergency needs may request up to $2,000 in childcare assistance as part of REAP’s support portfolio. This ensures that a lack of access to care does not further burden families in crisis.
Geographic Distribution:
Childcare, out-of-school programs, summer day camps, and youth mentoring and development programs are delivered across City parks, facilities, MCPS sites, and through third-party partners, helping to ensure equitable access throughout Rockville. These combined Recreation and Parks and HCD programs aim to address the operational and financial barriers facing Rockville families who need quality child care and youth enrichment.
Planning and Regulatory Support for Child Care
Community Planning and Development Services (CPDS) supports childcare in Rockville by administering zoning, land use regulations, and permitting processes. The department plays a vital role in determining where and how childcare providers can operate within the city. Under current zoning regulations:
• Family Child Care Homes serving up to eight children are permitted by-right in all residential zones. These homes are subject to fire safety inspections but do not require additional zoning approvals.
• Small Child Care Centers serving between nine and twelve children may operate in residential zones only if granted a Special Exception by the City’s Board of Appeals.
• Larger Child Care Centers serving more than twelve children are allowed by Special Exception in residential zones and are permitted by-right in nonresidential and mixed-use zones.
These zoning standards govern where licensed childcare providers may be located and under what conditions they can expand. CPDS collaborates with other departments to evaluate how these land use regulations align with City goals related to housing, economic development, and community well-being, including increasing access to quality childcare services.
While these zoning regulations have been in place for a number of years and are intended to address land use and neighborhood compatibility, there are several ways that the regulations could be modified to simplify the initial process and costs for child care providers while also retaining protections for communities. Staff recommends that daycare uses still be required to meet certain conditions that mitigate potential impacts on nearby properties while streamlining the process.
Obtaining special exception approval can be daunting to small providers, given the requirements for holding community meetings, preparing an application, and addressing the Board of Appeals in support of the application, as well as paying the filing fee. In addition, there are existing institutional uses that are well-located and have the building capacity to serve the population which could provide an opportunity for new or growing providers. These suggestions are incorporated into the strategies later in this report.
State Legislative Background: HB 389 / Chapter 122 (2025)
For the Mayor and Council's awareness, in 2025, the Maryland General Assembly enacted House Bill 389 (Chapter 122), which authorizes new tax incentives to support licensed childcare providers and reduce the cost burden of operating childcare facilities. This legislation introduces:
• Personal Property Tax Exemption for registered family childcare homes and large family child care homes.
• Real Property Tax Credit Authorization for local jurisdictions-including Rockville-to grant property tax credits of up to $10,000 (or the actual tax paid) for property space dedicated to child care operations.
These provisions are intended to incentivize quality childcare growth, improve provider sustainability, and reduce barriers to entry. CPDS is coordinating with the City Manager’s Office, the City Attorney’s Office, and Finance to evaluate aligning Rockville’s municipal code to activate these new state-enabled tools for local providers.
Link: Maryland HB 389 / Chapter 122 (2025 <https://mgaleg.maryland.gov/2025RS/chapters_noln/Ch_122_hb0389T.pdf>)
Recommended Strategies
As part of this work session, staff have developed a coordinated list of 11 strategies to improve access to child care across the city. These recommendations are aligned with Rockville’s strategic goals of supporting families, enabling workforce participation, and improving quality of life. The proposed strategies include:
1. Increase Rockville Youth Recreation Assistance Fund (Rec Fund) scholarship amounts to improve affordability and increase access for families participating in programs and camps.
2. Adjust eligibility requirements for the Rec Fund to reduce barriers for qualifying families by allowing alternative independent financial verification, three months of support for the recently unemployed, and students who attend an MCPS school within City corporate limits are eligible for the fund.
3. Improve communication about existing subsidies and programs using the City’s website, Recreation Guide, social media, and interdepartmental outreach.
4. Expand access to out-of-school programs and summer camps by exploring new MCPS bus routes, maximizing enrollment capacities, and incorporating Student Service Learning (SSL) in teen programs.
5. Expand youth mentoring and development programs to serve more students in underserved schools and neighborhoods.
6. Use the Rockville Emergency Assistance Program (REAP) to offer up to $2,000 for the expense of childcare to qualifying families in crisis starting in FY26.
7. Incorporate child care focus into FY27 Community Services and Enrichment Grants, requiring funded providers to offer low- or no-cost child care for Rockville families and expand capacity through targeted support.
8. Modernize zoning rules for home-based childcare, including raising the maximum number of children allowed by right and enabling Conditional Use approval for mid-sized childcare homes.
9. Streamline zoning requirements for child care centers in residential zones, particularly in places of worship and community-serving facilities.
10. Permit and encourage childcare centers in nonresidential and mixed-use zones by treating them as accessory uses and adjusting parking and site requirements to suit urban contexts better.
11. Activate new State-authorized personal property tax credits under HB 389 / Chapter 122 by adopting enabling ordinances, creating transparent application processes, and communicating directly with eligible providers.
These strategies reflect increasing childcare and out-of-school access through financial relief, program expansion, and regulatory modernization. Feedback from the Mayor and Council will help prioritize the next steps and guide resource alignment across departments.
Mayor and Council History
This work session marks the first time the Mayor and Council have formally reviewed child care expansion and discussed how to further support child care in the city.
Fiscal Impact
If both Strategy 1 (increasing scholarship amounts) and Strategy 2 (expanding eligibility) are adopted, the Rockville Youth Recreation Assistance Fund (within the Special Activities Fund) is expected to increase by approximately 35%, or $25,000, in FY 2026 compared to the FY 2025 amended budget of $70,000.
This increase is due to higher scholarship rates per child per session (8% to 10% increase) and expanded eligibility, including income-based verification and MCPS students attending schools within City limits. Based on current trends and FY 2024 actual spending of $62,881, full implementation could bring the total need to around $95,000 in FY26. This adjustment can be brought forward for Mayor and Council approval with the first budget amendment of FY 2026.
If Strategy 11 is pursued, the fiscal impact associated with the reduced personal property tax revenue will need to be further evaluated, though it is not anticipated that the revenue reduction would have a material impact on overall City finances.
Next Steps
Based on the outcomes of this work session, staff will confirm the Mayor and Council’s direction and goals for enhancing child care opportunities in the city, develop implementation plans, and/or proceed with implementing approved strategies.