How to Start a Child Care Center in Maryland: MSDE Office of Child Care License

Overview: What This Guide Covers

Opening a licensed child care center in Maryland is a multi-step process overseen by the Maryland State Department of Education (MSDE) Office of Child Care. Group child care centers are regulated under COMAR 13A.16, which sets standards for facility safety, child-to-staff ratios, health protocols, and developmental programming. Maryland has approximately 1,334 private child day care services establishments (BLS, 2024).

This guide walks you through business formation, facility preparation, staffing, regulatory compliance, and the licensing process. It is informational content only, not legal or tax advice. Before you begin, hire a Maryland-licensed attorney and a CPA who specialize in child care operations.

Important distinction: This guide covers child care centers (serving multiple families). Family child care homes operate under COMAR 13A.15, a separate registration system, and are not included here.

Before You Start: Prerequisites and Baseline Requirements

Before investing time and money, confirm you meet these foundational requirements:

• Legal capacity: You must meet the age requirement in COMAR 13A.16 (confirm with the Office of Child Care) and have no disqualifying criminal convictions or substantiated child abuse or neglect findings in Maryland or any other state.
• Financial readiness: You will need capital for facility renovation, equipment, safety features, insurance, staff salaries, and operating costs during the startup phase. Licensing delays can extend your pre-revenue period.
• Time commitment: Licensing can take many months, so confirm current timelines with the Office of Child Care. You must be available for inspections, training, and compliance work before the center opens.
• Professional support: Retain an attorney familiar with Maryland child care law and a CPA experienced with child care accounting. Do not skip this step.

Materials and Requirements Checklist

Before submitting a license application to MSDE, you must have or commit to securing the following:

Facility Requirements

• A physical space meeting MSDE square footage and ceiling height standards for your planned capacity (specific requirements vary by age group and enrollment size; contact MSDE to confirm your space plan)
• Separate bathrooms accessible to children with warm running water and child-appropriate fixtures
• Outdoor play space meeting COMAR 13A.16 standards for safety and developmental appropriateness
• Kitchen facilities with health department approval if you prepare meals on-site
• Secure storage for hazardous materials, medications, and confidential records
• Fire suppression equipment, first aid supplies, and emergency communication systems
• Compliant lighting, ventilation, and temperature control throughout

Staffing and Personnel

• A director (confirm director qualifications and the minimum staff structure with MSDE for your planned size)
• Teachers and aides meeting MSDE child-to-staff ratios for each age group served
• All staff must pass comprehensive background clearance: criminal history, child abuse registry check in all states, and fingerprinting
• CPR and First Aid certification for all staff before opening
• Director and teaching staff training records (MSDE-approved orientation and ongoing professional development)
• No criminal convictions or substantiated abuse/neglect findings in a staff member's history

Documentation and Policies

• Parent handbook and enrollment agreements
• Health, illness, and medication administration policies
• Discipline and guidance philosophy (age-appropriate, non-punitive approaches)
• Confidentiality and records retention procedures
• Incident reporting and emergency response protocols
• Curriculum and developmental programming for each age group
• Grievance resolution and parent communication procedures

Financial and Legal Setup

• Business structure (LLC, corporation, nonprofit) with articles filed with SDAT
• Federal Employer Identification Number (EIN) from the IRS
• General liability and worker's compensation insurance (typical coverage: $1 million to $2 million liability)
• Financial accounting system for tuition, expenses, payroll, and tax compliance

Step-by-Step: How to Start a Child Care Center in Maryland

Step 1: Form Your Business Entity and Get an EIN

Before applying for a child care license, establish your business legally. Child care centers can operate as sole proprietorships, LLCs, corporations, or nonprofits, each with different tax and liability implications. Consult your attorney and CPA on the best structure for your goals.

File with Maryland SDAT:

• Visit the Maryland Business Express portal at https://egov.maryland.gov/businessexpress or file by mail with the Maryland State Department of Assessments and Taxation (SDAT), Charter Division, at https://dat.maryland.gov/businesses/Pages/default.aspx
• File Articles of Organization (LLC) or Articles of Incorporation (corporation)
• Standard LLC filing fee: $100
• Processing time: non-expedited filings are reviewed during the second calendar month after submission (expedited review costs $50 extra)
• You will pay a $300 annual report fee each April 15

Get a Federal EIN:

• Apply online at https://www.irs.gov/ein for immediate issuance
• You need an EIN for payroll, tax filing, and business bank accounts

Step 2: Secure a Facility and Plan Compliance

Do not sign a lease until you confirm the space meets MSDE requirements. A non-compliant building will fail inspection and waste your investment.

Assess the space:

• Contact MSDE Office of Child Care for specific square footage, layout, and safety requirements based on the ages and number of children you plan to serve
• Request a written site review from MSDE before you commit to a location
• Verify utilities, fire codes, zoning compliance, and structural soundness
• Confirm outdoor space meets COMAR 13A.16 standards for size, fencing, and play equipment

Plan renovations and setup:

• Install safety gates, outlet covers, and secure storage for chemicals and medications
• Separate diaper-changing areas from food preparation zones
• Design bathrooms with child-height fixtures and warm running water
• Create defined learning spaces for different age groups
• Set up a kitchen meeting health code standards if you serve meals on-site

Obtain preliminary approvals:

• Contact your county health department about kitchen and food service approval
• Request fire marshal review of emergency exits, fire suppression, and life safety compliance
• Confirm local zoning allows child care operations

Step 3: Develop Policies and Standard Operating Procedures

MSDE will review your operating policies to ensure compliance with child safety and development standards. Write these before you apply.

Core operating policies:

• Enrollment, tuition, and fees (including whether you plan to accept Child Care Scholarship recipients; see Step 7)
• Health and illness policies (exclusion criteria, medication administration, emergency response)
• Discipline and guidance (describing non-punitive, age-appropriate approaches)
• Staff conduct, confidentiality, and conflict-of-interest standards
• Parent communication and involvement expectations
• Incident and injury reporting procedures
• Emergency preparedness (fire, lockdown, weather, missing child)
• Grievance and complaint resolution process

Curriculum and programming:

• Outline daily activities and learning routines for each age group
• Describe how you will implement Maryland's Early Learning Standards (for programs serving 3 to 5 year-olds)
• Document developmental assessment and observation methods
• Include outdoor play, social-emotional learning, and gross and fine motor development

Step 4: Recruit Staff and Complete Background Clearance

All staff and volunteers must pass comprehensive background checks before they work with children. Begin recruitment and clearance 3 to 4 months before your target opening date, as screening can take 6 to 12 weeks.

Recruitment:

• Hire a center director (if required by your capacity), lead teachers, assistant teachers, and support staff
• Prioritize candidates with early childhood education degrees, certifications, or relevant training
• Verify prior experience in regulated settings and obtain references from past employers

Background clearance required for all staff:

• Criminal history check via Maryland State Police and FBI fingerprinting (LiveScan)
• Child abuse and neglect registry check in Maryland and all other states where the person has lived
• Disqualifying factors include certain criminal convictions, substance abuse findings, substantiated abuse or neglect, and sex offender registry status
• MSDE will conduct the registry check; you submit fingerprints and consent forms

Training and compliance:

• All staff must complete CPR and First Aid certification before your opening day
• Director and teachers must complete MSDE-approved orientation training (topics and hours set by COMAR 13A.16)
• Maintain signed training certificates in personnel records for every staff member
• Plan for ongoing professional development and in-service training

Step 5: Prepare and Submit the MSDE License Application

Once your facility is prepared and staff are on board, contact MSDE to request the formal application package. The office will provide a checklist and guide you through submission.

Application typically requires:

• Business registration documents (Articles of Organization/Incorporation, EIN, Maryland business registration)
• Facility information (address, square footage, floor plan, outdoor space details)
• Enrollment plan (ages served, capacity, hours of operation)
• Staff roster with roles, qualifications, training records, and completed background clearance documents
• Complete operating policies (health, safety, discipline, parent communication, emergency procedures)
• Curriculum and developmental programming plan
• Proof of liability insurance
• Health and safety compliance documentation

Application fee:

MSDE child care center licensing fees are not verified in this guide. Contact the MSDE Office of Child Care directly to confirm the current application fee, payment method, and any renewal fees.

Submission:

• Mail or hand-deliver the complete application to the MSDE Office of Child Care
• Keep copies of all submitted documents for your records
• Request a confirmation receipt showing the application was received

Step 6: Facility Inspection and Compliance

After MSDE reviews your application, a licensing inspector will schedule a comprehensive on-site inspection. This typically occurs 4 to 6 weeks after application submission.

Inspection covers:

• Facility safety (emergency exits, fire suppression, first aid supplies, hazard-free environment)
• Child supervision and staff-to-child ratios during observation
• Bathrooms, kitchen, and food service areas
• Outdoor play space and equipment safety
• Staff qualifications and training documentation review
• Staff knowledge of operating policies and emergency procedures
• Review of emergency drills (fire, lockdown, weather) and documentation
• Health records and vaccination compliance for staff

Addressing deficiencies:

• If violations are found, you will receive a written report with required corrective actions and compliance deadlines
• Serious violations (child safety hazards) must be corrected before licensing
• Minor violations typically have 30 to 90 days for correction
• Request a follow-up inspection once corrections are complete
• License will not be issued until all violations are resolved

Step 7: Health Permits and Funding Considerations

Before opening, secure health permits and understand funding options, including the current status of Maryland's Child Care Scholarship.

Health permits:

• Request health department authorization for food service if you prepare meals on-site
• Ask the county health department which health approvals your facility needs
• Comply with immunization and health documentation requirements for staff

Child Care Scholarship:

Maryland's Child Care Scholarship program froze new enrollments effective May 1, 2025. As of October 2026, the freeze status is uncertain. If you plan to serve families using the scholarship, confirm current eligibility and enrollment policies with MSDE before you finalize your tuition and enrollment projections.

• Visit MSDE's Child Care Scholarship page at https://earlychildhood.marylandpublicschools.org/ccsenrollmentfreeze
• Call 877-227-0125 for current enrollment status and waitlist information
• Budget conservatively. Scholarship rates may not cover your full operating costs

Insurance:

• Secure comprehensive general liability insurance (typical coverage: $1 million to $2 million)
• Obtain worker's compensation insurance for all employees
• Verify property insurance for equipment and facilities
• Some facility owners require proof of insurance before you occupy the space

Step 8: Finalize Operations and Launch

Once you receive your MSDE license, you are authorized to operate. Set up operational systems before enrolling children.

Financial setup:

• Open a dedicated business bank account for tuition, payroll, and operating expenses
• Set up bookkeeping and payroll processing
• Work with your CPA on quarterly estimated tax payments and annual filing
• Track all business expenses for tax deductions

Marketing and enrollment:

• Create a website and social media presence
• List your center in local directories and business listings
• Connect with pediatricians, schools, employers, and community organizations
• Offer facility tours to prospective families

Tuition and fees:

• Research local tuition rates and set competitive pricing
• Factor in staff salaries (60 to 75 percent of revenue), rent, utilities, insurance, and supplies
• Clarify enrollment agreements, cancellation policies, and late pick-up fees

Ongoing compliance:

• Renew your MSDE license on the schedule MSDE sets (confirm the term, fee and process with MSDE)
• Maintain staff training and personnel records
• Report any significant incidents or injuries to MSDE within required timeframes
• Prepare for unannounced compliance inspections
• Keep policies and procedures current as MSDE regulations evolve

Tips and Common Mistakes to Avoid

1. Engage legal and accounting professionals before you start. Many operators wait until they encounter a regulatory or financial problem. A Maryland attorney and CPA specializing in child care will save you money and prevent costly mistakes in business structure, contracts, and compliance.

2. Verify facility requirements in writing before signing a lease. Have MSDE review your floor plan and space specifications in advance. Building out a non-compliant facility wastes thousands of dollars and delays opening.

3. Start background checks early. Criminal history and registry checks take 6 to 12 weeks. Begin clearance for your director and key staff 4 months before your target opening. Do not hire anyone before their background check is complete.

4. Do not underestimate operating costs. Child care is labor-intensive. Staff salaries and payroll taxes typically consume 60 to 75 percent of revenue. Include rent, utilities, insurance, food, supplies, and unexpected repairs in your budget. Tuition alone often cannot cover these costs in the first 1 to 2 years.

5. Verify Child Care Scholarship status. The program's freeze has uncertain timeline. Do not assume scholarship funding will be available. Build your enrollment plan without relying on it, and revisit if the freeze is lifted.

6. Write and test emergency procedures. MSDE will scrutinize your emergency response plans. Conduct regular fire drills, lockdown drills, and weather drills. Document every drill with date, time, and outcome. Staff must know procedures before opening.

7. Do not confuse child care centers with family child care homes. Centers are regulated under COMAR 13A.16. Family child care homes operate under COMAR 13A.15. Using the wrong standard will derail your licensing application.

8. Never operate without insurance. Liability, worker's compensation, and property insurance are non-negotiable. Do not open your doors without these policies in place.

9. Keep accurate records from day one. MSDE and parents require documented staff training, incident reports, health records, and developmental observations. Sloppy record-keeping will be flagged during inspections.

Expected Timeline and Results

Opening a licensed child care center in Maryland typically follows this timeline:

• Months 1 to 2: Business formation with SDAT (30 to 60 days), facility selection, and policy development
• Months 2 to 3: Facility renovation and staffing (overlapping with other steps)
• Months 3 to 4: Background clearance for all staff (6 to 12 weeks depending on screening agency)
• Months 4 to 5: MSDE application submission and review
• Months 5 to 6: MSDE facility inspection
• Months 6 to 7: Corrective action (if needed) and follow-up inspection
• Months 7 to 9: License issuance and opening

Total: Approximately 6 to 9 months from planning to opening. Some operators achieve faster timelines with careful planning and overlap; others experience delays if inspections identify significant violations or background checks take longer than expected.

Once licensed, you are legally authorized to operate your child care center. You will be subject to license renewal, unannounced compliance inspections, and ongoing adherence to COMAR 13A.16 and MSDE policies.

Disclaimer: This Is Informational Content, Not Legal or Tax Advice

Child care licensing in Maryland involves federal, state, and local regulations that are complex and subject to change. This article provides general guidance only. Before you invest time and capital:

• Consult a Maryland-licensed attorney experienced in child care law
• Consult a CPA with experience in nonprofit or for-profit child care operations
• Contact the MSDE Office of Child Care directly for current requirements, fees, timelines, and regulatory changes

MSDE Office of Child Care contact information:

• Website: https://earlychildhood.marylandpublicschools.org
• Phone: Contact the office through the website for the current phone number

Additional resources:

• Maryland Business Express (business filing portal): https://egov.maryland.gov/businessexpress
• Maryland Small Business Development Center (free consulting): https://www.marylandsbdc.org/
• COMAR 13A.16 (full regulatory text): Available at https://regs.maryland.gov (search COMAR 13A.16)