How a failed contract could upend New Hampshire’s entire childcare quality system

The latest financial challenge for New Hampshire childcare providers started with a heated exchange in the Executive Council chambers. 

At a session on May 6, Councilor John Stephen pursued an aggressive line of questioning toward Lori Weaver, commissioner of the Department of Health and Human Services, regarding a childcare contract. 

Contracts between state agencies and third parties exceeding $10,000 go to the elected Executive Council for approval. Some contracts get voted through without debate. Others, usually those that are controversial or political, can be discussed at length and in depth. 

The contract allocated $1.2 million of federal funding to a company to provide professional development services to childcare providers. The company, Pyramid Model Consortium, has been under contract with the state to provide such services since 2022. It would have been the contract’s third amendment and its largest, expanding the company’s responsibilities to administer more of the state’s Granite Steps for Quality program, New Hampshire’s version of a national quality childcare recognition system that pays incentives to childcare providers. 

Stephen said he was told the contract was “not the best use of funds” compared to the childcare workforce grant program, which has been childcare advocates’ priority issue for the 2026 legislative session. The workforce grant program is currently unfunded after the federal government said it could not be funded with Temporary Assistance for Needy Families dollars. 

Weaver and her colleagues from the department, the agency that houses the Bureau of Child Development and Head Start Collaboration, which administers Granite Steps for Quality, updated the council on the workforce grant TANF situation and briefly explained parts of the $1.2 million contract, such as its coaching for special-needs inclusion. 

However, they did not mention that the amendment had been brought before the council in September 2025 and was tabled. The May 6 amendment cost the state about $200,000 less and included additional services, such as free online learning modules. 

Department officials also did not fully explain that the contract would consolidate coaching and professional development resources for Granite Steps for Quality, keep the state in compliance with federal childcare subsidy laws, and fund a large portion of the quality program that has lacked consistent funding or service support for years. 

Councilor David Wheeler also objected to the contract, saying that its language referenced diversity, equity, and inclusion (the contract would have provided teachers with coaching on caring for children with disabilities and special needs). The contract was tabled and subsequently failed. 

And as a result, acceptance into the program is paused, and providers could lose the program’s payment incentives that are helping keep their businesses afloat. 

How it impacts the Granite Steps for Quality program

Granite Steps for Quality, or GSQ, is a voluntary state-federal professional development program that helps early education programs enhance the quality of their programs and teachers through various methods. Programs enrolled in GSQ pick a “pathway” to pursue and try to move through different “steps” of the pathway by elevating their staff’s credentials and improving their learning environments. 

As a result of participating, programs receive quarterly “incentives” payouts ranging from $600 to $5,700 at different stages. Daycare businesses often operate on thin margins, and directors have said that GSQ funding helps them balance their budgets. Of over 700 licensed childcare programs in New Hampshire, 132 are enrolled in GSQ. 

The two main pathways of GSQ are the Pyramid Model and the Environmental Ratings Scales. 

The state has fully funded the Pyramid Model pathway, starting with its initial 2022 contract with the Pyramid Model Consortium. It focuses on improving how teachers handle social, emotional, and behavioral issues in children from 6 weeks old to age 5. 

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Funding for professional development and coaching for the Environmental Rating Scales pathway has been spread across multiple vendors since at least 2022. The pathway is for programs that serve children in early and out-of-school time care, focusing on improving environmental factors that support learning. A majority of developmental support for the pathway ended last year, while the e-module support ends June 30. 

The 69-page contract proposed on May 6 sought to fully fund the Environmental Rating Scales pathway and bring both pathways under one company, the Pyramid Model Consortium. The contract states that approval would increase the pathway’s coaching services and create a “unified” system. 

“To ensure comprehensive support for all GSQ pathways, this amendment addresses the current gap in coaching for programs following the ERS pathway programs, ensuring consistent statewide access to expert-level support and advancing GSQ’s continuous quality improvement goals,” Weaver wrote as an explanation of the May 6 contract amendment.  

The state has been amending the same contract with Pyramid Model Consortium since the initial contract was passed in 2022. The council has approved two previous amendments that increased the program’s funding using federal funds and extended the contract through 2028. The last amendment was approved by the Executive Council in September 2025, the first time it came across Stephen’s desk during his first term on the council.

The ripple effects of a failed contract

The consequences of not continuing to fund the program were explained throughout various contracts with the Pyramid Model Consortium, but were lost in translation over four years of contract amendments and turnover at the Bureau of Child Development and Head Start and the state Legislature. 

While the program is lesser known and used by about a fifth of the state’s licensed childcare programs, it plays an important role. The decision has left bureau officials scrambling to find a solution to GSQ funding, on top of dealing with the backlash from and confusion within the childcare community. 

At a June 11 Child Care Advisory Council meeting, Jessica Carver, chief of the Bureau of Child Development and Head Start Collaboration, spoke to childcare providers about the recent failure of the GSQ contract amendment. Carver started in late fall of 2025, replacing the previous bureau chief who had been in the position for a little over a year. 

“[It] is quite devastating, especially to providers, should we have to look at everything that’s on the table,” she said. “And everything is on the table right now.” 

A week later, Carver sent out a notice to providers in GSQ. The bureau announced that it would temporarily pause new applications to GSQ. Step increases, which determine incentive payouts, would also be paused for applications in the renewal process unless a program can meet all necessary professional development requirements itself. 

Carver wrote that the bureau is working on a “contingency plan” for GSQ, but estimates that if the contract with Pyramid Model Consortium does not get approved, childcare programs will lose about $2.3 million in quarterly incentives. She said the department will have a plan of action within the next month. 

The lack of contract approval could also affect New Hampshire’s childcare subsidies. In order to receive Child Care and Development Fund dollars, the federal grant that funds childcare initiatives like the New Hampshire Scholarship program, the state must provide a certain amount of quality and professional development initiatives. Without it, New Hampshire could be sanctioned, and future federal funding could be reduced. 

The next executive council meeting is on July 9.