Iowa to spend millions more to improve child care access, governor announces

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Iowa Gov. Kim Reynolds’ Child Care Task Force has released its final report, which proposes a plan for addressing the state’s child care crisis.

Iowa Gov. Kim Reynolds announced the release Wednesday in a news conference at Sprouts Early Learning Academy in Carlisle .

“Iowa’s businesses are desperate for workers, and a child care shortage that prevents parents from entering or remaining in the workforce hinders our ability to meet this challenge,” Reynolds said.

She said 23% of Iowans overall, and 35% of rural Iowans, live in a child care desert.

The child care shortage costs the state’s economy $935 million annually in terms of lost tax revenue, employee absences, and turnover, the report said . The average monthly cost of child care for Iowa families is $1,031, which is more than it spends on housing, it said. With the pandemic, child care providers have had to close or faced debt, higher expenses and worker shortages.

The Reynolds Administration will take the following actions, a news release announced Wednesday :

  • By next year, Iowa will establish an online child care management system for child care providers to share services for business operations such as administrative tasks, group purchasing and professional development.
  • In January, the state will begin publicly designating employers who “go above and beyond” to accommodate employees with children as a “Best Place for Working Parents” to benefit job seekers and encourage businesses’ investment in child care.
  • “Iowa Workforce Development and Iowa Department of Human Services are launching a new round of $10 million in funding that is immediately available through the Childcare Challenge Grant Program . This funding supports expanding child care facilities and building new ones.”
  • The Iowa Department of Education has established $100,000 in grants through ESSER III funds to promote planning for blending child care and preschool learning opportunities.
  • The Iowa Department of Human Services will provide up to $200 million in American Rescue Plan Act  funding to help child care providers that have experienced financial loss because of the pandemic to stabilize.

“We’re not finished yet, this is only the beginning,” Reynolds said in the release. “These new initiatives are going to support our working families and ensure Iowa has the child care system needed to unleash our state’s incredible workforce and set our economy on a path to long-term, broad-based prosperity.”

Since the start of the pandemic, more than $137 million in state and federal funding has been allocated to support child care across the state, the release said.

Reynolds will explore other recommendations to address the child care shortage through additional executive action and legislative priorities during the upcoming legislative session.

She established the taskforce in March through an executive order following a recommendation from her Economic Recovery Advisory Board.

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