New Mexico Governor Michelle Lujan Grisham recently proposed offering free child care to all families, regardless of income, aiming to use revenue from oil and gas production to remove the state’s current income eligibility limit starting November 1.
State lawmakers must approve funding and final rules, but the plan already expands child care access by about 12,000 children and offers low‐interest loans to build new child care centers as demand surges.
Lujan Grisham said free child care is life‐changing for parents because it frees up money for essentials like utilities and groceries.
The governor’s budget request includes an additional $120 million a year, a roughly 26 percent increase over current spending of $463 million, according to The Associated Press. She plans to draw from savings in New Mexico’s early childhood trust fund, federal funding, and state investments.
Parents across the United States, including many people of color, have raised concerns about the affordability of child care. New Mexico’s move to address high child care costs could prompt legislative action in other states to expand access to child care services.
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Black families are facing especially steep child care costs. According to a report from the Annie E. Casey Foundation, the average annual cost of child care for one child in 2021 was about $10,600. For Black families and other families of color, this cost represents a larger share of income.
In another study by American Progress, 32 percent of non-Hispanic Black households with children under age 12 reported inadequate access to child care. Among those, more than a quarter said an adult in the household had to leave or lose a job because care was unavailable.
Reports have pointed to low-income working Black parents being much more likely than white and Asian parents to spend a large share of their income on child care. In some cases, child care costs force difficult choices between working and caring for children.
New Mexico started diverting surplus state income to a fund for early childhood in 2020, The Associated Press reported. That balance is nearing $10 billion, with about $500 million in investment earnings directed annually to early childhood programs.
Some Republican lawmakers have raised concerns that this benefits wealthy families. New Mexico already expanded eligibility in 2022 to cover families with incomes up to four times the federal poverty rate (about $128,000 for a family of four), and it waived copayments. Critics question whether eliminating the income cutoff is fair or sustainable.
To meet the expanded need, the state estimates it must build more than 50 new licensed child care centers, 120 licensed group homes, and as many as 1,000 new registered homes serving small numbers of children.
Child care slots are already scarce in many regions, and low-income families reported reduced attendance when income eligibility was raised.
The governor’s plan would cover the infant and toddler years as well as care before and after public preschool. Average costs for infant care in New Mexico run around $12,000 per year, considered a large expense for many households.
Supporters say the policy will help families earn more, reduce financial stress, and help children get better prepared for school. They argue it’s an investment in both economic stability and early education.
Opponents warn that without careful planning, costs could balloon. They worry about whether the state can sustain expanded eligibility and whether care quality might decline as more families join in.
Even with funding, New Mexico faces supply constraints. There is a need for new facilities and qualified providers, especially in rural areas. Attendance from lower-income families in some areas has dropped when eligibility widened, suggesting that access is not just about eligibility but also availability and convenience.
Another concern: New Mexico ranks low in measures of child well-being. A 2025 survey by the Annie E. Casey Foundation placed the state last among the 50 states.
That raises questions about whether expanded child care alone will be enough to improve outcomes without simultaneous investment in quality and early education.
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