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After 14 months of negotiations, family child care providers who participate in the state's child care subsidy program have settled their first contract with the Maryland Department of Education and Governor's Office, said leaders of Service Employees International Union Local 500 on Monday.

The contract calls for an average 3 percent increase in the rates the state pays to subsidize the thousands of providers who care for children from lower-income families. Those rates vary based on children's ages and counties where they live. The agreement also allows a union representative on the state Child Care Advisory Council and forms a new training committee.

"This is a big step for us," said Madie Green, a family provider in District Heights and SEIU Local 500 vice president of child care, who was on the bargaining committee. "It allows us to be able to sit at the table with other agencies and organizations that we deal with and help make regulations."

The rate increase comes courtesy of the federal stimulus package, Green said.

The agreement now goes to program providers for their approval; that vote is being conducted by mail. While the number of providers in the program varies from month to month, there are about 4,700 in the Maryland program, said Anna Oman, a spokeswoman for SEIU Local 500.

The union has about 1,000 members, but providers in the subsidy program don't have to be a member to vote, she said.

Child care providers in Maryland, both home-based and in centers, generate about $1 billion in gross receipts annually, which does not include payroll, according to a report by the Maryland Committee for Children. The Baltimore nonprofit provides training and other services for child care providers.

The estimated average annual cost of child care for a family varies from $22,527 in Montgomery County to $9,512 in Allegany County, according to the committee. There were about 9,000 family providers and 1,500 centers last year in the state. While the number of center-based programs has grown in recent years, the number of family providers has declined.

The pay for child care employees is lower than the state average for all occupations, according to U.S. Department of Labor figures. The median hourly pay of child care employees in Maryland was $10.19 in 2008, about 44 percent of the median hourly wage of all occupations in the state.