Minnesota Title V MCH Needs Assessment Fact Sheets

Children and Adolescents

Access to Quality Affordable Child Care

November 2004

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Size of the Problem

Minnesota’s labor force is 2.7 million people strong [1]. Almost one-third of Minnesota’s workers have children under the age of 18, and fifteen percent are parents with children under the age of six [2]. Minnesota leads the nation in the participation of women in the labor force – at 70.3% in 2000 compared to the nations’ 60.2%. In addition, the state ranks forth in the labor force participation of men [3].

In Minnesota, based on the number of single working parents and dual parent households with both parents in the workforce, it is estimated that currently 45,180 infants, 90,060 toddlers, 93,980 pre-schoolers, and 442,570 children ages five to twelve need some form of care to enable their parents to work – a total of 671,790 [4].


Preschool children of parents working full time spend a significant amount of their day, often five days a week, in childcare. Children’s experiences during these early years have a profound influence on their later development. For example, numerous studies have shown the devastating effects on intelligence and brain development of a lack of basic nutrients in the prenatal period, in infancy, and in early childhood. In a similar way, a child’s relationship with others and exposure to positive nurturing experiences during this critical time has a lasting effect on emotional development. Quality child care providers and child care environments are critical in order to provide children good nutrition, safety from violence and injury, positive social experiences, safety from environmental toxins, and early identification of special health or development needs.

Childcare affects the ability of parents to work and financially support their children, it affects an employer’s ability to attract and retain employees, and affects the economic well being of the State.

Childcare is costly for everyone. The average annual cost for full time licensed care for an infant is $10,868 in the metro area and $7,592 in Greater Minnesota; for a four year old it is $7,904 in the metro area and $6,240 non-metro [5]. Parents with a low income devote a significant amount of their income for child care costs. For example, compare the average 2003 annual cost of day care for an infant in the metro area ($10,868) with the annual earnings of a family of three at 175% of poverty ($26,705). State funded childcare subsidies are intended to address this problem.

Due to budget cuts in the 2003 Minnesota legislative session, state child care funding was cut by $86 million, which included a 50 percent decrease in the amount of state assistance available for the Basic Sliding Fee (BSF) program [6]. The child care funding cuts were accomplished with policy changes that included decreasing income eligibility for the program, raising parent co-payments, and freezing the amount the state will reimburse child care providers to 2001 market rates. The Minnesota Department of Human Services reports that as a result of the 2003 legislative changes, 1,300 families lost child care funding assistance [7].

Eligibility: As of July 1, 2003 a family’s income must be at or below 175% of poverty in order to begin receiving childcare assistance. Families leave the program when their earnings are 250% of poverty ($38,150 for a family of three). However, the legislature puts a cap on the amount of childcare dollars each year, and as a result, income eligible Minnesota families are placed on waiting lists once the demand exceeds the allocated dollars. In September 2002, 4,290 families across the state were on childcare assistance waiting lists [8]. As of November 2003, about 6,000 families were on the waiting lists [9].

Parent co-payments: The amount that a family receiving childcare assistance must contribute, or their co-payments, increased for approximately 25,000 Minnesota families in the summer and fall of 2003. The average increase was about 57% for families of three and four [10].

The impact of these changes on working families is not fully known at this time, however there are reports that it is affecting some parents ability to continue their employment or schooling [11]. Alternatively, parents may arrange for informal care of their child, such as free care from a relative or the child’s sibling, or may find a less expensive unlicensed child care programs.

The impact of these changes on the childcare industry is also not fully known, but there are concerns that childcare providers may close due to decreased reimbursement levels and decreases in business.

Cuts in childcare subsidies disproportionately affect children of color and American Indian children. According to the 2000 Census, children of color and American Indian children were significantly more likely to live in poverty than white non-Hispanic children. Twelve percent of while children live in households with incomes below 150% of poverty. In comparison, 57% of Hmong children, 46% of American Indian children, 39% of Hispanic Latino children, and 47% of African American children live in households with incomes below 150% of poverty [12]. Children in these households that are under 13 meet the income requirements for childcare assistance; their household income is less than 175% of poverty.


For many Minnesota children, childcare is their source for early childhood programming. For this reason, research on quality early childhood programs is relevant to evaluating the effectiveness of quality childcare as an intervention.

Evidence supports the conclusion that the benefits from investing in early childhood extends beyond the time a child turns six.
A recent study by the Federal Reserve Bank of Minneapolis indicates that investing in early childhood is one of the best long-term investments the state can make. Quality early childhood programs generate a 16% rate of return on investment, 12% of which is public return [13].

* One study of the High/Scope Perry preschool project, which provided a high-quality preschool education to children of poor families, weighed the costs of the program against its economic benefits – including higher earnings by the children who attended, reduced incidences of special education services, welfare assistance, and crime. The analysis found that the return on investment was dramatic: every public dollar spent on the program saved $7.16. Adults who participated in the Perry Preschool Project as children earned more that their peers, fewer of them utilized welfare assistance (59% versus 80%), and almost three times as many owned their own homes, versus their peers who did not participate in the program [14].

* In the Abecedarian Early Childhood Intervention, an experimental preschool program serving the children of low-income, African-American families in Chapel-Hill, N.C., researchers found a significantly reduced rate of teen pregnancy among participants as they reached adolescence and a 51% reduction in child maltreatment for children who attended the program [15].

* In a longitudinal study of the Chicago Child Parent Centers in Illinois, a high quality early childhood education program for low-income families publicly funded and administered through the Chicago School District, significant and lasting gains were noted for participating children. Participants in the program had a 33% lower rate of juvenile arrest and a 42% reduction in arrest for violent offenses. Furthermore, participants had a 29% higher rate of high school completion, a 41% reduction in special education placement, and a 40% reduction in the rate of grade retention [16].


At the same time that state funded child care assistance dollars have been significantly reduced, there is an growing effort among foundations, private businesses, and non-profit organizations to raise awareness of the need for additional early childhood programs for children birth to 4 years old.

Two early childhood initiatives in Minnesota are focusing on securing resources from private/public partnerships to provide school readiness programs to low-income four-year old children. The Federal Reserve Bank of Minneapolis is attempting to secure an endowment to provide these education opportunities. Ready4K, a non-profit organization in Minnesota, is working to secure statewide preschool programs for low-income four-year olds to facilitate the development of school readiness skills.

Thirty-six early childhood coalitions in communities throughout greater Minnesota have been established in the last two years through grants from a collaborative called the Minnesota Early Childhood Initiative that includes the McKnight Foundation, the Northland Foundation, and other foundations, corporations and community partners. The goal of the early childhood coalitions it to: 1) build upon the early childhood strengths of their community 2) encourage partnerships and create uses of local resources to build opportunities for young children, and 3) identify and develop partnerships to address needs in early childhood care and education. The first 24 communities were selected in 2003. The final 12 were announced in June 2004.

While these are exciting new developments with promise, two areas of concern arise. First, these initiatives are limited and none of them will provide all low-income children (ages 0-13) with access to quality child care programs while their parents work. Second, these programs may or may not adequately address the health issues of early childhood that are well known to the public health community. Thus, this is a critical time for public health professionals to become involved in assuring access to affordable quality childcare for all children.

In the area of strategies for child care and school readiness from a public health perspective, the MCHB published their Strategic Plan for Early Childhood Health, 2002-2007. This plan identifies five critical components for early childhood systems development: 1) access to medical homes 2) mental health and social-emotional development, 3) early care and education services, 4) parent education, and 5) family support services. The MCHB is currently funding state planning grants to assess and plan for a comprehensive early childhood system, with the potential for implementation grants to follow.

Public health has many resources and skills to offer, both in the area of technical information and in the area of strategies for child care and school readiness from a public health perspective. In 2002, the US Department of Health and Human Services identified 13 indicators of quality child care and developed standards for each with the intent to protect children from harm. Some of the identified indicators are child abuse, immunizations, medications, and handwashing/diapering [17].

In Minnesota, childcare centers are required to have a health consultant (Minn. Stat. 95-3.0140). The consultant must review the center’s health policies and practices and certify that they are adequate to protect the health of children in their care. This review is required annually for programs serving toddlers and preschoolers; however, a monthly visit is required for programs that serve infants. There are no such requirements for licensed family daycare homes.

The federal Maternal and Child Health Bureau (MCHB) has focused attention at the national level on early childhood development and childcare [18]. In the area of technical information for child care programs, MCHB supported the work of the American Public Health Association and the American Academy of Pediatrics in developing two manuals of standards for health and safety in child care settings: Caring for Our Children, National Health and Safety Performance Standards: Guidelines for Out of Home Child Care Programs and the follow-up publication, Stepping Stones to Using Caring for Children. Additional MCHB supported programs are the National Resource Center for Health and Safety in Child Care, The National Child Care Information Center and Healthy Child Care America, and the National Training Institute for Child Care Health Consultants at the University of North Carolina. The MCHB also supports the National Center for Infant and Child Health Policy at the UCLA Center for Healthier Children, Families and Communities.


1. National Economic Development and Law Center, The Economic Impact of the Child Care Industry in Minnesota, p. 9 (2003).
2. National Economic Development and Law Center, at 31.
3. National Economic Development and Law Center at 8.
4. National Economic Development and Law Center at 9.
5. National Economic Development and Law Center at 12, citing Minnesota Child Care Resource and Referral Network, 2003.
6. Children’s Defense Fund –Minnesota and Child Care Works, Feeling the Pain, The Emerging Impact of Minnesota’s $86 Million Cut to Child Care, at 1.
7. Minnesota Department of Human Services, Child Care Assistance: Facts and Figures, p. 2.
8. Children’s Defense Fund-Minnesota and Child Care Works, at 3.
9. Minnesota Department of Human Services at 2.
10. Children’s Defense Fund-Minnesota and Child Care Works, at 2.
11. Children’s Defense Fund-Minnesota and Child Care Works, at 3.
12. Children’s Defense Fund of Minnesota, Minnesota Children and the 2000 Census: Poverty and Ethnicity (2003).
13. Federal Reserve Bank of Minneapolis, The ABCs of ECD, A Discussion on the Economics of Early Childhood Development, p. 9 (December 2003).
14. ZERO TO THREE Policy Center, Growing Up Healthy: What Local Governments Can Do to support Young Children and Their Families.
15. ZERO TO THREE Policy Center, Growing Up Healthy: What Local Governments Can Do to support Young Children and Their Families.
16. ZERO TO THREE Policy Center, Growing Up Healthy: What Local Governments Can Do to support Young Children and Their Families.
17. US Department of Health and Human Services. (2002). 13 Indicators of Quality Child Care: Research Update. http://www.aspe.hhs.gov/hsp/ccquality-ind02/ [Attn: Non-MDH Link]
18. See also, Halfon, Hochstein, and Shulman, UCLA Center for Healthier Children, Families and Communities and The National Center for Infancy and Early Childhood Health Policy, A 21st Century Investment Strategy for American’s Children, Supporting State Efforts to Improve School Readiness, A Maternal and Child Health Perspective, January 2001.