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State allocates $31 million for child care for Montana families

Concerns linger about long term solutions

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More help is on the way for Montana families trying to strike a balance between work and taking care of their children, but concerns remain about whether more one-time funding will bring about long-lasting change. 

Governor Greg Gianforte announced June 29 that $31 million in funding from the American Rescue Plan Act would be dedicated to increase available child care for working parents. This comes on the heels of a June 24 meeting of the ARPA Health Advisory Commission that worked to allocate the funds. At the meeting, state officials reported that current licensed child care services would only serve 27 percent of children under age 6 in the state. 

Gianforte’s office reports that 171 child care programs closed in Montana since the start of the pandemic. There are currently only 916 licensed child care facilities, meaning that the number of providers dropped by 16 percent during the pandemic. 

“For too long, Montana’s working families have faced a shortage of child care providers, putting them on long wait lists and between a rock and a hard place. The pandemic only made the problem worse, further destabilizing the system,” Gianforte said in a press release. “As Montanans get back to work, these funds will help stabilize our child care system, increase access to quality child care providers, and address child care deserts throughout our state. We are determined to use this one-time-only federal funding to produce long-term solutions that begin to fix this longstanding problem.”

According to a press release from the governor’s office, more than $31 million of the funding will be directed toward subgrants for child care businesses with priority given to child care providers that expand hours or serve children with disabilities, infants, toddlers or low income families. Family, friends, neighbors and faith-based child care providers will also be included. 

Another $6.8 million will be set aside for program administration and operations, including grant application assistance, capacity building, technical assistance and business professional development services.

The state still has $26.5 million in ARPA funds that it could allocate, but they don’t have to be earmarked until Sept. 22. 

At the ARPA Health Advisory Commission meeting, Jamie Palagi, administrator of the Department of Public Health and Human Services Early Childhood and Family Support Division, said the state is in the process of drafting maps showing which parts of Montana are in child care deserts. Palagi reported that 73 percent of the state is located in child care deserts. 

“Essentially, the majority of the state ... is a child care desert,” Palagi said. 

Department of Labor and Industries Economist Amy Watson said that rural counties are “significantly undersupplied” with child care facilities, with eight counties having no licensed providers at all. The shortage has a significant impact on the economy. 

“About six percent of the workforce requires some form of child care to remain in the workforce,” Watson reported. 

The Department of Labor and Industry has reported that 40 percent of Montana businesses have been impacted by a lack of affordable child care hampering their ability to hire and keep employees. While the funding may be much-needed, it remains to be seen if the funds will create a long-term fix. 

“It’s that cliff that we are looking at,” Republican Senator Carl Glim, of Kila, said in the committee hearing. “If we use 60 some-odd million dollars to bolster the child care process in Montana, when that money runs out either parents are going to have to pay to keep the thing going or they are going to be looking to the state to make it work. I get that some of this is COVID-related, but we had this problem before COVID, and in my mind, the market needs to sort this out. It needs to pencil for the parent to go to work and be able to pay for child care. If it doesn’t pencil out then it doesn’t work, right? It doesn’t make sense that we should take taxpayer dollars and subsidize child care.” 

In Lake County, that math doesn’t always pencil out for families. A representative from the Department of Labor and Industry reported to the Valley Journal in June that the majority of businesses hiring in Lake County that month posted ads for workers with wages at $10-$12 per hour. According to Kids Count Montana, the average cost of child care for Montana families is between $8,400 and $9,500 per year. At that price, a person working full-time at a $12 per hour job should expect to spend approximately 40 percent of their income on child care. 

Child care facilities are also feeling a price crunch. The average wage of child care workers in Montana is $10 an hour, according to data presented to the commission. Legislators pointed out that many fast food restaurants in the state are paying more, at $14-$15 an hour, making it difficult to attract workers to child care careers. 

Despite the challenges, Montana DPHHS Director Adam Meier said he thought the funds could be used to make positive headway. “As we think about these areas that have less population density where it’s hard to support your traditional child care model but there’s still going to be a need, this is an opportunity for us to give technical assistance to those family and friend and home-based providers, many of which are not licensed,” Meier said. “If we come alongside and provide licensing assistance, provide technical assistance, provide business consultation, they can set up their businesses in a way that will allow them to avail themselves of these resources that we do routinely have.”


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