Who will care for the children?

There were 56 licensed child care providers in Rock County in 2016 compared with and 37 today, creating a rapidly widening gap between working families who need child care and the available slots with licensed providers.
At last count, inventories show a need for more than 180 children over the available licensed spaces, and local leaders are exploring ways to address what they consider to be a child care shortage crisis.
On Monday the Luverne Economic Development Authority reviewed findings from an updated market feasibility study for a child care center.
The first one in 2016 provided useful data to prompt conversations over the past couple of years with government officials, schools, community leaders, non-profits and with local providers who shared insights into the challenging business of child care.
 
Why not just build a facility?
While there will always be a need for in-home providers, a center would cover the child care shortage, in addition to ongoing local needs like drop-in care, sick care, extended hours and coverage for home-based closures due to illness or vacations.
However, despite a clear demand, business models show a child care center is a challenging venture — for many of the same reasons there are fewer in-home providers.
“It’s a challenge to keep rates affordable for families while offering high wages for child care staff,” said EDA director Holly Sammons who serves on a local committee working on child care solutions.
According to feasibility studies, centers that pay professional wages to directors and staff have difficulty making it cash flow (even with a donated building), given the low wages of average working families in the community.
That’s a big reason there aren’t enough in-home child care providers; it’s difficult to profit amid strict licensure requirements and low family wages. Meanwhile the work is stressful and the hours are long and demanding.
Sammons said the theme throughout the local meetings about child care is that there likely won’t be one solution; it may be a number of different solutions with a variety of supporters.
“We may need to look at creative ways to fund child care,” Sammons said earlier this year when she suggested a combination of public and private dollars might need to subsidize a child care solution.
 
‘Setting the table’
In order to facilitate a solution, Sammons said the city is doing what it can to help with the process, but the right entity needs to take charge.
“All we can do is set the table and say, ‘Here’s what it’s going to take,’ and make sure all the tools, resources and information is readily available,” she said. “This type of data is what lenders and investors need to know.”
That’s why the LEDA commissioned Maxfield Research, Sioux Falls, to update its 2016 market feasibility study, which was combined with feedback from local employers, providers and schools.
Also, Luverne is partnering with First Children’s Finance, a national nonprofit that helps communities and families with available, affordable and quality child care and education.
The agency connected Luverne with the Rural Childcare Innovation Program to coordinate conversations about the community’s unique needs.
 
Why it matters
The child care shortage affects the entire community, the health and well-being of residents and opportunities for economic growth.
Businesses can’t expand here if there’s no child care for their workers, and families can’t move here to take jobs if there aren’t trusted care options.
From an employer’s perspective, inadequate or unreliable child care for workers means absenteeism, lost production and difficulty filling positions with qualified workers.
 
By the numbers
The updated study considered a “primary market area” that included Rock County and surrounding communities, and Sammons reviewed some of the data Monday.
•Census data shows there are roughly 1,000 children younger than 5 in the market area, and that number is likely to remain steady in coming years.
•Of those 1,000 children, national research shows 42 percent are cared for by a parent or relative.
•The remaining number — 624 children in Rock County — need a day care slot somewhere, and home-based providers are currently the only resource.
•According to national averages, given the choice, 30 percent of families chose in-home care and the rest chose center-based care.
•Based on those trends, if Rock County families had a choice, 187 kids would go to in-home providers and 437 could be enrolled in center-based care.
•Considering it’s realistic to capture 75 percent of actual market demand, the more realistic numbers would be 141 for home-based care and 328 could potentially be in center-based care.
“That to me, shows the demand for some type of center-based care in our area,” Sammons said.
She cautioned that applying national trends to local data doesn’t produce absolute totals.
For example, even though national trends show 42 percent of working families lean on relatives, that number may be closer to 75 percent here. Or, it may be only 20 percent.
“It’s gray,” Sammons said about the research. “It’s a function of assumptions.”
•Another way to run the numbers is that Rock County has 37 licensed in-home providers for 12 children each, meaning they can take up to 444 children.
•If 624 children under 5 who need care fill all of the 444 available slots at in-home providers, that leaves 180 children witihout child care.
•However, each provider can accept only two infants, and some opt not to accept any or to accept only one. Sammons said infant and toddler care are in greatest demand.
All data aside, she said the child care issue is a pressing concern across all social and economic sectors.
“Parents are saying, ‘we can’t find day care,’ and employers are saying, ‘we need more day care,’” Sammons said.
Center-based care is clearly needed, but for how many children and for which age groups? That’s what the research attempts to determine.
The updated study confirmed the findings of the original study, but this one is more specific, taking into account state requirements for child care centers.
•Considering state requirements, a facility needs roughly 100 square feet per child, counting common spaces like kitchens, bathrooms and hallways, etc.
•Outdoor activity areas must provide at least 75 square feet per child, with additional space for parking and convenient pick-up and drop-off.
•Base construction costs are estimated at $130 per square foot for an average wood-framed single-story structure with average finishing. That doesn’t account for financing, land acquisition or other “soft” costs.
•If the center were to develop an on-site outdoor activity area, additional costs would be incurred, which can be estimated at approximately $1,000 per child.
 
‘We need a project champion’
The local committee working on child care solutions toured and interviewed a variety of day care facilities in the area to see what works for them.
They connected with Rock Rapids Kids Club, New York Mills, Little Diggers Daycare in Lynd, Benson School District and Victory Christian Church in Balaton.
Sammons said Monday that behind every successful child care center there’s a passionate leader or team committed to making sure it succeeds.
“We need a local project champion to bring it forward with enthusiasm and support,” she said.
While several parties have come forward with interest in starting a center in Luverne, Sammons said they haven’t been able to find the right solution.
A non-profit, faith-based organization is currently considering the venture as a local mission, which would reflect a shift in the approach to local child care.
The LEDA spent $7,000 on the 2016 Maxfield Research study and $5,000 this year for updated findings.
Mayor Pat Baustian said it was a good investment.
“I’m glad the EDA went through with the study, because any business looking to build a day care center is going to need this data,” he said.