Our Methodology

CenterWorth's analysis is only as good as its data. Every number in your report comes from a documented source with an explicit confidence level — so you always know what to trust and what to verify.

Four data layers

CenterWorth's analysis draws on four distinct data layers. Understanding which layer drives any given number tells you how much to rely on it and what to verify independently.

Layer 1 — Official Regulatory Authority

Staff-to-child ratios, group size limits, space requirements, director qualification rules, and conditional staffing rules sourced exclusively from official state licensing agency regulations.

What we use

State administrative codes and statutes (e.g., 26 TAC §746, 22 CCR Title 22, 18 NYCRR Part 418-1)
Agency-published rule documents and official licensing handbooks
Each record carries a verification status: reviewed_full records are cross-referenced against primary rule text

Known limitations

Data reflects the rule as of the review date shown — not necessarily today
Covers licensed childcare center rules only; family homes and program-specific overlays are not included
Pending amendments and emergency rules may not be captured if enacted after the review date

Layer 2 — Economic and Public Data

Population demand signals, wage benchmarks, and demographic context sourced from US Census Bureau and Bureau of Labor Statistics APIs.

What we use

US Census Bureau ACS 5-year estimates — population, household income, childcare-age cohort by census tract
BLS Occupational Employment and Wage Statistics (OEWS) — state-level wages for SOC 39-9011 (Childcare Workers), 25-2011 (Preschool Teachers), and related occupations
Census geocoder — converts a street address to census tract and state FIPS for local data lookup

Known limitations

ACS data is a survey estimate, not a count — margin of error is higher for small geographies
BLS OEWS reflects the prior calendar year and lags current market conditions by 12–18 months
Census tract-level population data represents residents, not necessarily demand for childcare in that tract

Layer 3 — CenterWorth Calculations

CenterWorth's proprietary financial model combines regulatory staffing requirements with wage data, tuition inputs, and cost assumptions to produce profitability estimates.

What we use

Staffing cost: headcount from ratio requirements × wage inputs (user-provided or BLS benchmark)
Break-even enrollment: fixed costs ÷ (tuition per child − variable cost per child)
Operating margin: (revenue − total operating costs) ÷ revenue
Feasibility grade: composite score from break-even ratio, margin, wage-to-revenue ratio, and market context

Known limitations

Assumes current enrollment equals stated capacity during cost calculations — ramp rate is modeled separately
Does not model multi-site overhead, franchise fees, or complex ownership structures
Feasibility grade is a planning signal, not a guarantee of business viability

Layer 4 — Assumptions and Defaults

When user inputs or primary data are not available, CenterWorth applies documented assumptions. Every assumption is explicitly labeled in reports.

What we use

Payroll burden (benefits, taxes, workers' comp): 18–22% of gross wages (industry standard range)
Classroom utilization: assumes state minimum square footage per child to estimate room capacity
Billing weeks per year: 50 weeks (allows for two closure weeks) unless user specifies otherwise
Insurance and miscellaneous operating costs: percentage-of-revenue defaults drawn from CenterWorth's model of typical center expense structures

Known limitations

Defaults are directionally accurate for planning but will not match your specific circumstances
Always replace defaults with your actual costs wherever possible — the model is more useful with real numbers
CenterWorth does not source default assumptions from advocacy surveys or industry association publications

Data source hierarchy

When multiple sources are available for the same value, CenterWorth uses this priority order. Each level's label appears in your report so you can always see which tier is powering a given number.

You providedUser-provided inputs

Data you entered directly into the calculator. Always the highest-confidence source — it reflects your specific situation.

Examples: Your tuition rates · Your actual rent · Your staff count and wages

Official sourceOfficial regulatory and government data

Data obtained directly from government or regulatory bodies — state licensing agency rules, Census Bureau data, BLS wage surveys. These are authoritative primary sources.

Examples: State DSS/DCFS/DOE licensing regulations (reviewed_full) · US Census ACS population and income via Census Bureau API · BLS Occupational Employment and Wage Statistics (OEWS)

Live dataLive API data

Real-time data fetched at report-generation time from government APIs. Reflects current vintage but depends on API availability.

Examples: Census Bureau API (ACS 5-year estimates by census tract) · BLS OEWS API (state-level wage benchmarks) · Geocoder (census tract and state FIPS from address)

Regional benchmarkRegional benchmarks

Derived from aggregated market data for your specific state or metro area. Updated periodically. More reliable than national averages but less precise than your own market research.

Examples: State-level wage benchmarks from BLS OEWS · Regional commercial rent ranges · State operating cost benchmarks

National estimateNational estimates

National averages used when regional data is unavailable. Lower confidence than regional data. Clearly labeled in every report.

Examples: National average childcare worker wages · National typical rent benchmarks · National operating cost percentages

EstimateSystem estimates / defaults

System-generated estimates based on industry rules of thumb. Lowest confidence — replace with your own data whenever possible.

Examples: Default payroll burden percentage (benefits, taxes) · Industry-standard rent thresholds · Typical billing week assumptions

Regulatory data pipeline

Staff-to-child ratios and licensing rules are the foundation of every childcare center's cost structure. CenterWorth treats regulatory data as its highest-authority external data layer — and sources it exclusively from official state agencies.

Primary sources only

CenterWorth compiles ratio requirements, group size limits, and conditional staffing rules exclusively from state administrative codes, statutes, and official agency rule documents. We never use secondary aggregators, advocacy publications, or ACF/ChildCare.gov profiles as a regulatory source. ACF profiles are self-reported by states and not independently verified; they are explicitly excluded from our pipeline.

Verification status

Each state record carries a verification status:

reviewed_full / verified_full: Primary administrative code reviewed in full; ratios, group sizes, citations, and conditional rules confirmed against rule text. Record is locked.
reviewed_partial: Primary source reviewed but one or more fields could not be extracted (noted explicitly).
not_reviewed: Record exists but has not passed full review. Not published as authoritative.

What regulatory data covers

CenterWorth's regulatory records cover licensed childcare centers (not family homes). Each record may include: age-band ratios, maximum group sizes, indoor/outdoor space requirements per child, conditional staffing rules (nap/rest, transport, water activities), director qualification summaries, effective dates, and official source citations. Fields that could not be verified are explicitly marked rather than estimated.

Important: not legal advice

Regulatory summaries on CenterWorth reflect the rules as of the review date shown. Regulations change. CenterWorth's regulatory data is for financial planning and decision-support — not for legal compliance determinations. Always verify current requirements directly with your state licensing agency before making staffing, facility, or licensing decisions.

Data refresh policy

Every paid CenterWorth report includes a 30-day data refresh window. During this period you can regenerate your report with updated live data (where available) without additional charge.

After 30 days, a Pro subscription ($29/month) enables unlimited refreshes. Reports without a refresh subscription continue to display the data as it existed at the time of generation, clearly labeled with the data-as-of date.

The free calculator does not refresh — it always uses the most current benchmarks available at the time you run it.

Regulatory data (staffing ratios) reflects the review date in CenterWorth's database, which may differ from the report generation date. The regulatory review date is shown in any report section that uses it.

Limitations

CenterWorth reports are planning estimates, not guaranteed outcomes. Actual profitability depends on many factors the model cannot predict, including enrollment ramp rate, staff turnover, local competition, regulatory changes, and general economic conditions.

Wage and rent data may lag current market conditions by 12–18 months depending on the data vintage. Your own research into current local market rates is always the most reliable source.

Staffing ratio requirements and licensing rules can change without notice. Always verify current requirements directly with your state child care licensing agency before hiring, building, or signing a lease.

CenterWorth is not a substitute for consultation with a licensed accountant, attorney, or childcare licensing specialist.

Feasibility grades and market scores are planning signals. They reflect how inputs compare to modeled benchmarks — not a prediction of whether your specific center will succeed.

Proprietary compilation & intellectual property

CenterWorth™ Regulatory Intelligence is a proprietary dataset compiled, normalized, and maintained by CenterWorth. The underlying government regulations are public-domain works produced by state and federal agencies. CenterWorth does not claim ownership of any government law or rule text.

What CenterWorth does own is its proprietary compilation, normalization methodology, routing logic, machine-readable structured schema, confidence-scoring framework, derived financial models, benchmark datasets, and the software that assembles, validates, and presents these data layers.

Users may rely on this information for internal planning purposes only. Redistribution, resale, or use in commercial services without a CenterWorth commercial license is prohibited. See our Terms of Service for details.

How to correct data

If you believe a data point in your report is inaccurate, the most effective correction is to provide your own verified values in the calculator — your inputs always override benchmarks and estimates.

If you have documentation showing that a regional benchmark or state regulation in our system is incorrect, please contact us with the specific field and your primary source citation. State licensing updates are especially welcome and reviewed on a priority basis.

Learn more about our standards

About CenterWorth

Origin, mission, and data principles

Research Standards

Source selection and verification criteria

Regulatory History

Review dates and data events by state

Run the Free Calculator Read our Disclaimer