Grow Your Childcare Business with the Indiana Micro-Facility Pilot Program

You are not required to have a signed lease or purchase agreement when submitting your pilot program application. However, we encourage applicants to identify a potential space as part of their application to effectively demonstrate their vision for adding a micro-facility to their program.

We do not recommend signing any agreements or making financial commitments for a space until you have been officially notified of your award status. To support this, the program includes a grace period between award notifications and the deadline for submitting licensing applications. This approach is intended to help minimize financial risk for applicants.

The state remains committed to supporting applicants and selected participants throughout this process.

You can find information on updated regulations for micro-facilities here. Keep in mind these regulations apply to micro-facility pilot program awardees and are valid for the duration of the pilot, which is currently set to expire on October 31, 2026. Providers that are not selected for an award may not open or run a micro-facility and must adhere to the standard provider regulations.

This is a pilot program and is intentionally designed to partner with a small group of child care providers to evaluate the feasibility and impact of micro-facilities in Indiana.

We request that each existing provider submit one application. If you are considering multiple sites or have plans to open more than one micro-facility, should you be awarded as a pilot participant, please indicate that on your application.

The micro-facility program was established by Senate Enrolled Act 2. Applicants are not required to be located in a child care desert to apply to the micro-facility pilot. However, in accordance with the state law that established this pilot program, the state may choose to prioritize child care deserts in selecting program awardees. For more information on child care desets please visit https://earlylearningin.org/closing-the-gap/.

Be as detailed as possible in outlining your vision, including your ability to open by April 30, 2025. Additionally, provide a clear and feasible cost breakdown that demonstrates thoughtful consideration of the financial aspects of your proposal.

LLEPs are not eligible to apply at this time due to restrictions in Senate Enrolled Act 2, which established the micro-facility pilot program.

You must have at least three years of experience as an owner or administrator of a licensed or registered program. If you previously operated as an unlicensed exempt provider and later became licensed or registered, only the years of experience after becoming licensed or registered count toward the experience requirement.

Keep in mind the experience must be as an owner or administrator. Experience as a teacher at a regulated program does not count toward the three-year requirement.

To be eligible for the micro-facility pilot program, you must have at least three years of experience as an owner or administrator of a licensed or registered program.

Keep in mind your experience must be as an owner or administrator. Experience as a teacher does not count toward the three-year requirement.

Micro-facilities must be a new facility and program location, rather than a replacement of an existing one. Existing programs must remain open throughout the duration of the pilot. As outlined in Senate Enrolled Act 2, micro-facilities are intended to expand child care seats through additional sites, increasing capacity under the umbrella of an existing program.

Micro-facilities may be located in any space that is zoned non-residential, separate from an existing program's facility (located at a different street address), and meet the requirements outlined in the pilot regulations. We encourage applicants to explore creative space options, such as partnering with community organizations to establish micro-facilities within an existing building that serves other functions, but can offer dedicated space for child care (i.e. libraries, schools, office buildings, gyms, hospitals, doctors offices). Keep in mind micro-facilities may not be located in a dwelling, per Indiana DHS regulations.

Micro-facilities must be located in a space that is zoned non-residential and is separate (located at a different street address) from an existing program(s).

Micro-facilities may not be located in a dwelling. Micro-facilities must be located in a space that is zoned non-residential and will be licensed as a child care center, rather than a licensed child care home.

Micro-facilities must be located in a space that is zoned non-residential and is separate (located at a different street address) from an existing program(s).

Micro-facilities cannot cook food on site. There may be an agreement with an existing program to be the food vendor if it is a CACFP-approved food program.

Micro-facilities are required to undergo a state fire marshal inspection and comply with their requirements. Facilities must have at least two exits with operable smoke detectors installed in each room and fire drills must be held monthly. All electrical outlets must be covered and cleaning supplies, flammable liquids and medicines must be stored in locked cabinets.

There is a required caregiver-to-child ratio for micro-facilities. The specific ratios can be found in the program application or here. Caregiver to child ratios are based on the average age of the children in the unit/group.

Micro-facility regulations also provide more flexibility for hosting multiple units/groups in one space, allowing for a large space to be separated into multiple "classrooms" with a visible room divider, such as a low cabinet, bookcase, or similar physical barrier.

Each micro-facility network (an existing program and micro-facility) must employ a supervisor/director that holds either an Associate's degree or CDA with more than three years of experience in early childhood education. The supervisor must visit each site within the micro-facility network at least once per week. Read more about staff requirements for micro-facilities here.

Employee background checks are required. Additional changes to the caregiver-to-child ratio and staff requirements can be found in the micro-facility policy manual, which will be provided to each applicant along with confirmation of their completed application.

Micro-facilities must be open and providing care for at least four hours per day, between the hours of 5 a.m. and 7 p.m. local time.

Only programs selected as awardees are eligible to open micro-facilities. Others may still apply through the standard licensure process to become a licensed or registered child care program.

Program awardees will receive pass-through start-up funding to be put toward costs associated with establishing a micro-facility program. That funding will be made available within six months of program awardees being notified.

For the first 90 days a micro-facility is operational, programs will receive the reimbursement rate of a licensed center. During the 90-day period, OECOSL will collect data on the true cost of care to determine the appropriate reimbursement rate for micro-facilities moving forward.

The micro-facility pilot program will run until Oct. 31, 2026, and micro-facility licenses will expire on Dec. 31, 2026. OECOSL and the state are exploring what continued licensure of micro-facilities will look like after Dec. 31, 2026.

Providers who are not selected may not open a micro-facility under the micro-facility regulations. However, they may still apply through the traditional process to become a licensed or registered child care program.

This is a one-time pilot program. The state will assess future plans for micro-facilities following the pilot.

Micro-facilities cannot participate in Path to Quality (PTQ) at this time. Programs are encouraged to run a high-quality program, and data will inform PTQ decisions in the future should this model be approved beyond the pilot phase.

Directors affiliated with a program for at least three years may apply.

Award recipients will be required to submit a separate license application for a micro-facility. Micro-facilities will be licensed as child care centers, but will be regulated under rules specific to micro-facilities and only applicable to pilot awardees.

Pilot awardees will be notified by the end of February 2025 and will be required to open their micro-facility by April 30, 2025.

Pilot awardees will be required to use an Indiana-approved child care management system (CCMS) to collect and share data with OECOSL. This may include, but is not limited to, enrollment, staffing, and expenses. Additionally, awardees will be asked to respond to regular surveys from OECOSL and its partners.