Requires the Department of Health and Human Services (DHHS), Division of Child Development and Early Education (Division), to update and revise the quality rating improvement system (QRIS) so that it includes alternative pathways for licensed child care facilities to earn a license of two to five stars based on program standards and education levels of staff as follows: (1) a pathway focused on program assessment; (2) a pathway focused on classroom and instructional quality; (3) a pathway focused on accreditation; and (4) any other pathway regarding updating the QRIS designated by the North Carolina Child Care Commission (Commission).

Allows a child care facility to request to be awarded a star-rated license based on accreditation from a national childhood education accreditation organization if the facility maintains its accreditation and remains in good standing. Sets out provisions governing the issuance of these licenses based on whether the license is three or five-star rated. For those earning less than five stars, there must be additional opportunities for the facility to increase its star rating. Allows the Commission to reassess an accreditations’ star-rating equivalency or change a rating, or approve additional accreditations from national organizations and determine the equivalency on request. Prohibits the Division from requiring facility with a two- to five-star-rated license to undergo a QRIS reassessment until rules implementing QRIS reform become effective. Effective February 1, 2025, requires that if the Division issues any new license with a rating of two to five stars to a child care facility or any facility that elects to undergo a QRIS assessment based on a program assessment before rules implementing QRIS reform become effective, then the facility must be evaluated using the specified scales. Provides that when the Division issues any new license with a rating of two to five stars to a child care facility or any facility that elects to undergo a QRIS assessment before rules implementing QRIS reform become effective, if the percentage of lead teachers in the facility required to meet the "rated licensed education requirements" criteria is set at 75% for the facility to earn those "education points" toward the facility's star rating, then the Division must lower the threshold to 50% of lead teachers. These provisions expire on the date rules implementing QRIS reform become effective.

Amends GS 110-90 by amending the Secretary of Health and Human Services’ powers to issue a license to any child care facility, by requiring that for any facility with a license of two to five stars or any new license issued to a facility with a rating of two to five stars, the rating must be based on program standards and education levels of staff. Sets out factors that must be considered when evaluating program standards and education levels of staff. Also requires providing licensed facilities with a rating of two to five stars with an opportunity to earn recognition for voluntary participation in other quality initiatives or specialties. Makes other conforming and technical changes.

Requires the Commission to adopt, amend, or repeal any rules regarding star-rating reform necessary to implement this act.

Appropriates $500,000 in recurring funds for 2024-25 from the General Fund to the Division for the administration of this act. Effective July 1, 2024.