Iowa announces over $200 million in child care ‘stabilization grants’

Gov. Kim Reynolds announced several new child care initiatives on Wednesday, including over $200 million in grant programs and incentives for businesses to offer child care to employees.

The programs come directly from the Governor’s Child Care Task Force Report, a 32-page document released Wednesday. The report, compiled by a group of state officials, business owners and advocacy groups, suggests ways that Iowa can increase the availability of child care and bring parents back into the workforce.

“Increasing access alone isn’t enough,” said Emily Schmitt, chair of the task force. “We need to access quality care that can be a springboard for learning and a resource for early childhood development and school readiness.”

Reynolds intends to act on some of the recommendations immediately, she said Wednesday during a news conference at a Carlisle child care center.

Grants to aid providers with pandemic losses

Iowa will allocate $200 million of federal funding toward “stabilization grants” to child care providers that suffered financial losses due to COVID-19.

“The pandemic … worsened an already challenging situation in child care providers and many are still struggling because of it,” Reynolds said.

The Department of Human Services will run the grant program. Applications for the grant have not yet opened. 

The state will also channel another $10 million to the Child Care Challenge grant program. The Department of Education will offer $100,000 to schools that are planning to integrate child care and preschool initiatives, 

Shared management service for child care providers

Iowa will launch a statewide program to help child care providers manage their business. Reynolds pointed to a similar program in New Hampshire that helped child care providers save on commercial insurance.

“This should make it easier for child care providers to run their businesses more efficiently and effectively and really focus their time on what they do best,” she said. “And that’s to provide our children with high quality care.”

Businesses can receive distinction for child care options

Iowa will start recognizing businesses that provide exceptional child care options for employees. The “Best Place for Working Parents” label will be given to companies beginning in January. Some employers offer onsite child care, or they reserve spots at a local provider for the children of employees.

“Our hope is that more businesses will make similar investments in their workforce,” Reynolds said.

The task force also recommended tax credits and exemptions for businesses that invest in child care for their employees. 

What comes next?

Reynolds said Wednesday’s announcements were “just the beginning of an ongoing administrative and legislative agenda, one with major change in view.”

The task force recommended 15 proposals in total, including more tax credits and incentives for child care providers, vacant school rehabilitation programs, easier enrollment for families and continued support for the education of child care professionals.

Reynolds said the state was still looking at ways to balance higher wages for child care workers and keeping care affordable for families.

“It’s not going to be solely addressed by government,” Reynolds said. “The private sector also plays a role in this.”

Schmitt, chair of the task force, encouraged Iowans to read the full report and contact their state legislators about child care issues. The report is available online through the governor’s office.