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Opening or Buying a Child Care Center

It is important to realize a child care center is a business. In Oklahoma, you must have a license to operate a child care center business. You will have start-up costs such as costs to meet licensing requirements, fire and safety codes, rent, equipment and supplies, insurance, personnel, marketing, etc.

You may be buying an existing center, but you are not buying their license, their Oklahoma Department of Human Services (DHS) contract or the children enrolled. Children are not a commodity that can be sold or purchased. So, in most circumstances, whether you start a new center, or buy one, the first year will be a period of low enrollment.

This means for the first few months you may be bringing in insufficient income to meet your expenses. You need to plan for this. There are many resources available online and through the local Resource and Referral agencies to assist you in the business side of owning and operating a child care center.

The following information is designed to help you take the necessary steps from applying for a license to applying to contract with DHS. DHS staff are committed to making these processes occur as quickly as possible. 

It is important all DHS staff involved (Licensing Specialists, Stars Outreach Specialists and Child Care Liaisons) be notified at least 30 days before the effective date of any change or transaction, such as change in ownership, legal status or location. It does take time to complete the steps below, therefore you should prepare accordingly:

Step 1: License

Your DHS Child Care Licensing Specialist will assist you with getting a permit. A permit is usually recommended when you have provided and met the following:

  • Completed application
  • Proof of ownership/sponsorship
  • Child care staff summary
  • Child care staff information sheet for each employee
  • Documentation the director has a Bronze Credential or higher
    • Director's credentials are obtained through the Center for Early Childhood Professional Development (CECPD)
  • Criminal background checks from the Oklahoma State Bureau of Investigation (OSBI) for all employees. Out-of-state criminal background checks are also required for those staff who have been a resident of Oklahoma for less than one year
  • Documentation of adequate equipment for capacity
  • The center has had a licensing monitoring visit that shows you meet all the requirements listed in the publication Licensing Requirements for Child Care Centers
  • No other problems have been identified such as Child Welfare history, criminal history, police contacts, etc...
  • Documentation of fire approval within 12 months
  • Documentation of health approval within 12 months

When a permit is recommended, it is not "official" until it has been approved by both the licensing supervisor and the Oklahoma Child Care Services State Office. Once approved, you automatically receive a one-star rating. However, you must be a 1+ star or higher to be eligible to contract with DHS to be paid for child care services.

For more information on obtaining a child care center permit or license, please contact your local licensing office.

During this step, you can also be filling out your Stars application and working on meeting the criteria (such as getting training) you will need to qualify for a higher star rating.

Step 2: Stars Criteria

Note: You must be on permit or license to qualify for a higher star rating.

A higher star status can be recommended when you have provided documentation that shows you meet the following criteria:

1+ Star

  • You have a permit/license
  • Request for Child Care Center Star Certification (Stars application)
  • Documentation of Director's Credential
  • Documentation showing the Director has had 40 clock hours of training within the last 12 months; 20 of which must be Tier II management
  • At least one sample weekly lesson plan
  • A floor plan showing where the interest centers are in each room
  • Pictures of the interest centers
  • Documentation of 20 clock hours of training for any staff employed more than one year
  • A sample daily care sheet
  • Parent involvement methods
  • Licensing visits show a compliant history

2 Star

  • Provide documentation of all required at the 1+ Star level AND
  • Have the required number of master teachers for your capacity (1:30)
  • Staff salary scale and pay stubs

For more information on getting a higher star level, please contact your local Stars Outreach Specialist.

Step 3: Contract with DHS for Child Care Subsidy

Many working families are eligible for assistance through DHS for the cost of child care. DHS contracts with child care providers to help eligible families pay these costs. Contracting with DHS allows more families to be able to select your facility.

Before a contract can be signed and approved for a child care center, providers must have an DHS permit or license and have attained at least a 1+ Star rating.

You must have a land line phone. The contract application process includes:

  • Providing your photo identification
  • Providing your Social Security Card
  • Providing you Oklahoma State Bureau of Investigation (OSBI) Criminal History Information Report
  • Providing proof of ownership of the facility
  • Viewing a training video
  • Reading and signing a contract

The training video you will view includes information about:

  • Getting and keeping a contract with DHS
  • The business and record-keeping side of child care paid by DHS
  • How to get paid by DHS
  • Contracting rights and responsibilities

Contracts are approved or denied by staff in the State Office, Adult and Family Services, Child Care Unit. The effective date of a contract is never earlier than the date it is approved and signed in the State Office. A contract is never backdated.

If you care for children who are eligible for DHS subsidy before your contract is effective, DHS will not pay you for those days. The parent is responsible for paying the full cost of care. The parent also is responsible for the cost of care provided before the date that parent is approved for child care assistance. You will receive a Notice of Action after child care is approved at your facility.

After being approved for a contract, child care providers must use the Electronic Benefit Transfer (EBT) attendance tracking and payment system to receive subsidy payments from DHS.

  • You must have an account at a financial institution so an electronic payment can be made
  • You must call Affiliated Computer Services (ACS) at (405) 947-2700 after a child is authorized to attend your facility to ask them to install a point-of-service (POS) machine. You should receive the POS machine within 10 days for the date you call ACS.
  • Although DHS recommends that you not care for children until you receive the POS machine, if you choose to do so, you must record attendance on Form ADM-12-S, Child Care Claims.

If you enter into a collaboration or agreement with Head Start, Early Head Start, public schools, 21st Century Learning Center or any other program receiving state of federal funds, you must call the DHS Adult and Family Services, Child Care Unit at (405) 521-3931 within 30 days to report that agreement. You cannot receive payment from DHS for the same hours covered by that collaboration or agreement.

For more information on obtaining a contract to accept child care subsidy, please contact Adult and Family Services.