EDITORIAL: Child care bill needs a little more time to develop

Mar. 2—Consider a typical Minnesota household. (Granted, the word "typical" has lost a lot of meaning these days, but play along.)

A married couple, both 27 years old. Both employed, one earning $19 hourly, the other $21 hourly, for a household income that is just shy of the state median of $84,313.

They have their first child, and three months later, they enroll her at a day care center. They pay the state average of $1,312 per month for an infant, which translates to $15,744 over the next 12 months — or precisely 40 percent of the lower-earning spouse's gross annual earnings.

That's a big financial hit, especially if the couple has student loans, car payments and/or a mortgage. but with existing state and federal tax credits, their situation isn't impossible. With careful budgeting, they could get by.

Three years later, they have another child. Even without inflation, the family now faces average day care costs of $1,028 per month for their toddler and $1,312 for the infant, for a total annual cost of $28,080.

With one earner's take-home pay almost entirely consumed by child care costs, the couple faces a very difficult choice — and there's a good chance that Minnesota's workforce will shrink by one.

Situations vary, of course. Child care costs and median incomes are higher in the Twin Cities metro area and in Rochester, while more than half of Minnesota's counties currently have "child care deserts" where parents have few, if any, day care options. In-home day care can be significantly cheaper than centers, but that option has its own inherent inconveniences and unpredictability. And of course, some single parents have little choice but to pay for child care, regardless of cost.

The bottom line is that child care is a big financial burden for thousands of Minnesota families, which is why some DFL legislators have proposed the Great Start Affordability Act.

In a nutshell, this program would target households with incomes between $50,000 and $175,000 per year. (Existing programs already help families below that level.) The current proposal would cap childcare costs at 7% of total income, with the state covering the remaining cost. Per-child benefits could be as little as $25 per month and as high as $600 per month, with the state sending payments directly to care providers.

In theory, we support this idea. Minnesota already has a workforce problem, and expanded child-care subsidies would keep more people working. Plus, an influx of state funds would — we hope — result in higher wages for child care workers.

Such an increase is desperately needed, as the Minnesota Department of Employment and Economic Development says our early care and education workforce has "median wages below any other occupation requiring the same level of education in Minnesota, and well below the cost of living."

Some readers might now be wondering, "If the pay is so lousy, why should taxpayer dollars be used to put more kids in day care? Wouldn't kids be better off at home, with a parent, than in the care of underpaid, unhappy workers?"

Well, here's a plot twist: Based on hiring standards and staff-to-student ratios, no state has a better array of early childhood options than Minnesota. Those overworked, underpaid teachers do amazing things with our state's most precious resource. Parents who want their kids to be ready for kindergarten would be hard-pressed to find a better state in which to send their kids to day care. Provided, of course, they can afford it.

Affordability, it turns out, is our biggest concern with the Great Start Affordability Act. The two companion bills in the House and Senate offer very little in the way of specifics regarding cost. One line in the bill reads this way: "The base for fiscal year 2026 is $....... and the base for fiscal year 2027 is $......."

That fuzzy math doesn't surprise us, because the entire proposal has a lot of uncontrolled, unknown variables. How many families would likely participate? Would an increased demand for day care result in higher prices — and a need for bigger state grants? Could a family with a stay-home parent still get the subsidy? Would some day care centers "opt out" of eligibility for this program — and should they be allowed to do so?

And, even if we knew the price tag, we'd still be left to wonder: Where will Minnesota find the money? Last year's $17 billion surplus is largely spent, and projecting the ongoing costs of any new, ongoing program is extremely difficult. Take, for example, Minnesota's new free school meals program, which has been wildly popular — so popular that cost projections for its first four years are now $170 million above early forecasts.

Finally, there's the matter of oversight. Minnesota has very recent, very ugly experience with a program that sent money all over the state, ostensibly to help feed children — only to see hundreds of millions of dollars plundered through fraud. We're not saying that the same thing would happen with child care subsidies, but it's a safe bet that any loophole or gap in the system would invite exploitation.

So, while we support the basic idea behind this proposal, the devil truly is in the details — and right now those details are sorely lacking. Before this plan comes before the House and Senate, a lot of blanks will need to be filled in.

Perhaps the first iteration of Great Start should be less ambitious, targeting a smaller segment of the income scale. Also, the 7% cap seems aggressively low. We wouldn't be surprised to see that number rise as negotiations continue, especially if DFLers want the plan to gain any Republican support.

We are certain of one thing: This is not the type of program that Minnesota should create "on the fly" after the governor signs it into law.

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