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COVID pandemic complicates already challenging child-care expansion efforts in rural Minnesota

The difficulty of creating more child-care “slots” — in homes, revamped buildings or new facilities — remains acute.

Children play at Lynn Barten's family child care business in Alexandria.
MinnPost photo by Walker Orenstein
According to the Minnesota Department of Employment and Economic Development, the child-care shortage has hindered economic growth in rural areas.
In 2017, I visited New York Mills to write about the challenges that small rural communities have faced in creating more child care options – a problem that has only been made more confounding by the COVID-19 pandemic.

The struggling child-care sector did get some help earlier this year when Congress set aside $40 billion, as part of the American Rescue Plan, to increase subsidies for low-income families and to raise the pay of child-care workers. Minnesota will get a half-billion dollars under that plan, but the difficulty of creating more child-care “slots” – in homes, revamped buildings or new facilities – remains acute, especially in rural areas.

photo of katie heppner
Katie Heppner
Two years ago, for instance, officials in Wadena County joined a state-funded program that helps communities develop child-care projects. An initial analysis showed that the county needed 400 more slots to keep up with demand – “a staggering number,” as Katie Heppner, the executive director of the West Central Economic Development Alliance, which was involved in the effort, put it.

Spurred by that figure, local officials reviewed the problem, held a townhall meeting that drew 50 residents and began hatching plans for projects. Then the pandemic hit, turning meetings into Zoom calls, drastically increasing construction costs and changing the very nature of the child-care industry.

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“(The pandemic) significantly changed how we approached the process, but it also changed how (child care) providers have to do business, too” Heppner said. Those changes included “what people wanted and expected – not just the hours but the cleanliness and the transparency. And they wanted flexibility.”

Rather than developing a project that would add a significant number of slots, the county had to settle for small victories, instead, such as a streamlined permitting process for would-be home businesses and a Facebook resources and support page for child-care workers.

State, nonprofit partnership

The initiative at work in Wadena County, the Rural Child Care Innovation Program, is run by First Children’s Finance, a nonprofit group that finances child-care businesses, and funded through the Minnesota Department of Human Services.

The agency first helps communities that are chosen for the program to identify the child-care needs in their workforces, business development manager Jessica Beyer said. “We don’t go in and say, ‘You need to have X, Y or Z.’ We do a deep dive with the data and then present the information, and they think about what is best for them at the local level.”

The RCCIP process generally lasts about two years.

Another state agency, the Minnesota Department of Employment and Economic Development, also recently joined forces with First Children’s Finance in an effort to provide child-care businesses with marketing, consultation and other services.

In announcing the partnership in April, Bruce Strong, the director of DEED’s Minnesota Small Business Development Centers, said the child-care shortage has hindered economic growth in rural areas, adding that “the pandemic ‘exacerbated’ the state’s child-care shortage due to the shift to remote work and pandemic-related orders” in place at the time that caused some facilities to shutter.

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Making use of dormant space

The project I chronicled in New York Mills included the renovation of unused rooms in a county office building. Similarly, officials in Renville County have their eyes on a dormant public facility in Fairfax.

Michelle Marotzke, the economic development professional at the Mid-Minnesota Development Commission, has been working on child care in the county with the help of the RCCIP. One promising tentative plan would turn the band and choir wings in the old Gibbon-Fairfax-Winthrop Middle School, which is now privately owned, into a child-care center that could serve as many as 50 children, she said.

Community leaders in Wadena County, meanwhile, have completed inspections on some buildings in the region in case the time ever comes that they could be retrofitted. “The focus for now will be what we can do to support providers,” Heppner said. “But if construction costs go down, and if we have a project that makes sense, that will stay on our radar and be a priority. Hopefully, the stars will align.”