Michigan Tri-Share

25 Mar

Overview

The Michigan Tri-Share Child Care Program divides childcare costs equally among businesses, their employees, and the state. This Innovative program helps families with incomes between 200% and 325% of the Federal Poverty Level pay for high-quality childcare to encourage their workforce participation.

Why It Matters

Michigan families who earn too much to qualify for traditional childcare subsidies but too little to afford high-quality care face significant barriers to workforce participation. The Tri-Share program offers a solution for those families by distributing childcare costs equally among three stakeholders: employers, employees, and the state. This approach helps employers attract and retain talent while enabling more parents to enter the workforce.

The program fills a critical gap in childcare support by serving families with incomes between 200% and 325% of the Federal Poverty Level, who typically do not qualify for other assistance but still struggle with childcare costs. This targeted approach helps address the diverse financial challenges faced by families with young children.

Quick Facts

Core Model: Equal cost-sharing between state, employers, and employees
Notable Feature: Pioneered successful "tri-share" cost-sharing model
Launch Date: March 2021
Eligibility: Families earning between 200% and 325% of Federal Poverty Level
Current Funding: $3.4 million for FY 2024-2025. Initial $1.1 million in state funding for the pilot phase in FY 2021, with an additional $2.5 million invested in state funds in FY22. The state also matched employer investments at a rate of 2:1, up to $3 million.
Participation Rates:
- Employers: 195 participating employers
- Families: 514 families served
- Children: 713 children benefiting
- Providers: 351 childcare providers
Program Coverage: 59 counties and Detroit

Background

The Michigan Tri-Share Child Care Program originated from discussions among community leaders, business owners, and policymakers in western Michigan. It was designed to help families who earn too much to qualify for Michigan childcare subsidy programs but still struggle to afford the high costs of childcare.

The three-way cost-sharing concept was first proposed by the Grand Rapids Chamber of Commerce in response to employer concerns about childcare as a significant barrier to workforce participation. The initiative was introduced in March 2021, beginning as a pilot program in three regions — rural, suburban, and urban — and has subsequently expanded across the state.

The bipartisan nature of the initiative underscores a broad consensus on the importance of addressing childcare challenges, which has led to its ongoing success and expansion across Michigan.

How it Works

The program divides childcare costs equally three ways:

Employers pay one-third
Employees pay one-third
State of Michigan pays one-third

Regional "Facilitator Hubs" manage the program locally, handling administration, connecting families with providers, and processing payments. These hubs serve as connectors between employers, employees, and childcare providers, handling tasks including recruiting employers and providers, determining employee eligibility, billing the state and employers, and paying childcare providers directly.

Key Features

Regional Hub Model: Ensures local coordination and support while maintaining consistent statewide standards
Income-Targeted Approach: Specifically addresses the needs of families in the gap between subsidy eligibility and affordability
Employer Engagement: Engages businesses as active participants in helping their employees access childcare
Cost Reduction: Reduces family childcare expenses from 15% to 5% of monthly income

Policy Levers

Program Structure: Legislators established the three-way cost-sharing model and regional hub administration system
Funding Appropriations: State legislators allocated funding to support program operations and expansion across Michigan
Eligibility Parameters: Income requirements set at 200-325% of Federal Poverty Level target families who fall into the gap between subsidy eligibility and affordability
Geographic Implementation: Initial pilot targeted diverse communities (rural, suburban, urban) to ensure program adaptability statewide

Results

The Tri-Share program has demonstrated positive results since its launch:

Program Growth: Expanded from 3 to 13 hubs, now serving 514 families and 713 children across 59 counties and Detroit, with projections indicating a substantial increase in enrollment in the coming years. The program aims to serve 7,500 children across 5,000 households statewide by the year 2028.
Employer Engagement: Participation increased from 54 to 195 employers since June 2022.
Employee Engagement: Participating employers have reported significant improvements in employee retention rates of up to 80%. Four out of five surveyed employees agreed or strongly agreed that Tri-Share makes them more likely to keep working and stay in their current job.
Provider Network: 351 childcare providers now participate in the program, receiving reliable payments which are typically deposited bi-weekly by the facilitator hubs. This financial stability contributes to the sustainability and quality of childcare services.
Cost Impact: As of April 2023, parents enrolled in the program were saving an average of $464 per month, or an annual saving of $5,568.