SAINT PAUL, Minn. – Today, House DFLers announced and advanced a major plan to invest in child care and early learning. The plan would close opportunity gaps for tens of thousands of low-income and vulnerable children, help many more families access and afford care, and stabilize this critical sector. The portion of the plan contained in the House Early Childhood Finance & Policy Committee budget passed out of the committee this morning.
“Early care and learning are foundational to our economy and society,” said Rep. Dave Pinto (DFL - St. Paul), chair of the Early Childhood Finance and Policy Committee. “But this sector was in crisis even before the pandemic - unaffordable and inaccessible for families, with poverty wages for those doing this critical work. The investments we advanced today will get children off to the great start they deserve and ensure that parents can work, employers can hire, and communities can thrive.”
Low-income and vulnerable children are the least likely to have access to high-quality early care and learning. The House DFL proposal awards early learning scholarships to more than 20,000 vulnerable infants, toddlers, and preschoolers – those from low-income families, in foster care, homeless or highly mobile, or with a teen or incarcerated parent. Once these children turn four, they’ll have access to a statewide, mixed-delivery voluntary prekindergarten program.
The plan also increases reimbursement rates for the Child Care Assistance Program to the 75th percentile of current market rates, the federal standard. This represents a significant increase from current rates, which are set at the 40th percentile for infants and toddlers and the 30th percentile for older children. Thanks to this increase, more than 30,000 children from low-income families will be able to access care. The bill also makes more Minnesota families eligible for CCAP, including foster parents, custodians, and guardians.
“Minnesota has an obligation to help get all kids off to a great start, and we have an opportunity to do so now. Instead, we’ve heard over and over again about the need to shower tax benefits on large corporations and rich individuals who don’t need them,” said House Majority Leader Ryan Winkler. “Democrats want child care providers to be paid a wage that reflects the true value of their work. We’re proposing targeted tax cuts that will save young families thousands every year. When House Democrats say we are putting workers and families first, we mean it.”
Many families struggle to pay for early care and learning, including those who aren’t eligible for child care assistance or early learning scholarships. The House DFL tax bill establishes a Great Start Tax Credit that will provide families with up to $3,000 for each child under five years of age, with a cap of $7,500. This will help middle-income families afford early care and learning, allowing parents to work, preventing workforce shortages, and helping businesses and communities thrive.
“Young families are struggling in this economy, with childcare often being one of their largest costs. The Great Start Childcare tax credit better ensures our youngest Minnesotans can get the care they need without their families breaking the bank,” said Rep. Carlie Kotyza-Witthuhn (DFL - Eden Prairie), author of the provision. “Now is the time to capitalize on this moment and invest in the future of Minnesota, simultaneously helping working families pay for childcare, boosting child development outcomes, and allowing parents to return to work.”
Early care and learning providers operate on extremely thin margins. Many teachers and caregivers experience food insecurity, and one-third receive public assistance. This cannot help but have an impact on the children they serve. The proposal contains several provisions to support and stabilize the sector, including more than $200 million to continue monthly grants that have kept child care providers operating for the past two years. House DFLers recognize that ongoing public funding is necessary to meet this public need.
“One of the biggest challenges families face is the exorbitant cost of child care in Minnesota, that is if they’re even able to find child care at all. While this is a statewide crisis, it’s particularly concerning in Greater Minnesota where we’ve lost over 20,000 child care slots in the last two decades,” said Rep. Liz Olson (DFL - Duluth), the House Deputy Majority Leader. “For rural and regional economies to thrive, Minnesotans need access to affordable, accessible child care. Families and communities are counting on us to deliver these critical investments.”