House bill proposes tax credits for child care expenses
Item, next we will go to chair, lungs bill. Chair, Luna move house file, 38:53. And. Chair. Loon is the a form M it's yours it, is mr. chair okay. Any. Discussion on the four Amendment case. Represent alone that moves the HF. 3053, where someone moves the h35, three a four amendment, all favor say aye aye opposed. Motion. Prevails we now have the bill as amended before, us is. I see, that we have several folks or like to testify on the bill a Claire Sanford, Karen DeVos. Turn. That Potts is there anyone else which test by for the bill with. Concerns the. Department. Okay. With that, two-year. Bill as amended, represent balloon thank, you mr. chair and committee, members. This. Bill is trying to provide. Sort of a creative solution, to help get at the, childcare crisis, that we have here, in Minnesota it's, something that we hear a lot about we. Have spent some time trying to determine. Its, causes, and try to address or. Provide some solutions we. Actually have a subcommittee. On child care access, and affordability that, has been, started here within the this body and. There's a bipartisan. Bicameral Task, Force on child care the. Ola is currently, working on a report that will be released towards, the end of April on. Early. Childhood funding, and, programs. In our state so it's something that we spent a lot of time looking at but. What we know is that there, is a shortage. Of quality. Child. Care settings. Throughout. The state of Minnesota most, critically, I think in Greater Minnesota we. Have fewer. Workers. Employed. In in, that very. Important, line of work and, it's. Difficult for families to afford quality child care so the. Purpose of this bill is to try to again, provides, a sort of creative creative, solution, at. Trying to not only increase, quality, but increase access and, affordability, for. A good quality early, childhood, learning and why. Is it important, I think first of all it's important to establish that, you, know as a society. Making. Sure as we have many families, in Minnesota, where, both parents work or single my family households with children or, their parents work and where. Their children are during, those settings is critically, important, 90%. Of all brain development, is. Completed, by age five and eighty percent by age three and so. Those early years are critical and, we know if children are in quality, settings. That. They. Are, come. Into kindergarten. Really. Ready to learn ready to be successful and we, close that achievement, gap, that we have been trying to get, our arms around here so the. Package, before. You is really kind of a series of tax credits. Aimed. First, at parents, credits. To help offset the cost of, tuition, or, the cost of. Of. Having their children in a, quality. Childcare. Setting, and I would say that when I say quality this. Is all keyed off of the, parent aware ratings, that we have for, settings so that's a 1 to 4 star setting. With 4 being the highest and in. A way to encourage, more providers, to to obtain that quality, rating or. To increase. Their rating to hopefully, to four stars over time so. Parents would get a credit, businesses. Would, receive credit if they provide. Childcare for, their employees, children. Or. Support. Their. Employees in getting childcare of. A quality nature they would receive credits, childcare. Professionals, would. Receive credits, linking, to their individual. Educational. Attainment, again week, on track also that quality, is. Improved, when childcare, professionals receive, more professional, development and training to be highly skilled and the, very important work they do and finally.
For Owners. And operators of, child. Care and. Early childhood learning. They. Would link credits, to. The number of low-income children that, they serve I know for. Some. Operators. A lot. Of times whether it's CCAP, or other dollars, there's. A there's, a gap and the. Types of funding, through those programs that would cover children, and the, cost of that care so this would help a bit by giving them a credit for taking. More low-income, children who, again I think. Benefit. Vary. Greatly from, these programs and perhaps disproportionately. So so we. Are trying to help boost. The. The wages, of child, care employees through these this tax credits, and again, trying. To get them to increase, their. Professional. Development and educational. Attainment, so. This bill is modeled after a bill. That was produced, in the state of Louisiana, has gotten great accolades. And. Has really been held up as a national, model the, states of South Carolina, and Nebraska, have followed suit and so. With, that Claire. Sanford, with, the Minnesota. Child Care Association is here to tell you a little bit more about the proposal, okay. And before we go to miss, Sanford, if you look in your packets, for. The Loon bill the top. Insert. Here if you will should. Be for the next bill that, should be for the her cost bill so if you put that there and then I generally like to know where. Things, are coming from and so the next four items are from chair loon I believe. Yes. Mr. chair okay so the. Next four items. In your packet, are from chair, loon so okay. Welcome committee, please state your name and who you represent for the record please Thank. You mr. chair members my name is Claire Sanford and I represent the Minnesota child care Association, a statewide association of about 250, licensed, child care centers, and as, long as we're digging through packets, I've got some housekeeping, too on the papers I. Don't. Know if it's the same in the member packets as it is out here but, the handout titled, Louisiana, school readiness tax credits at, least on the handout out here is missing the last page and then. The. One entitled executive. Summary is, missing, the middle page that should be a three page executive summary we're missing page three. Sorry, fun people know there's there's more there and if we need to get it to you in a different form after committee or something we can do that okay think so week members we can get them the. Corrected, ones are on the table no, I picked, these up from here I'm not sure if they're correct in your packets, or not they're not okay. Okay. Well let's proceed please okay and the, last thing I wanted to point out on the house research bill summary at. The top of page three. There. Is a typo, the, very first bullet point at the top of page three says. Career, ladder step level, equivalent to a child development, associate. That. Should be that's a repeat of an earlier bullet that should be bachelor's. Degree, instead. Of child development associate. That should say, bachelor's degree and the credit should be two thousand, dollars not five hundred. Okay. Thank, you very much for that I was, going to mention that. Okay. Please proceed thank, you very much thank. You so much chair Lewin for your leadership on this bill and not just on this but for. All things early childhood in Minnesota chair lien has been such an incredible champion. For young children and, and those who serve them in this state and their parents, using. Members. My phone is off I think. I need a new phone, fake. News. Okay. I'm sorry I'm sorry that told you I'm just gonna shut this baby all the way down I. Think. Slight. Power off I. Apologize. But it's off just. When, I was chairing, a committee a few, years ago I announced in the committee for everybody you'd be sure to turn their phones off a few.
Minutes Later guess who's fallen off. It's. Off now. Oh. Okay. Please, continue that will not happen again from, me Thank. You mr. chairmembers I'll wait I'll wait for everyone else is going to go off not a problem at all. But. What did I what was I going to say oh. Thank. You I was just starting. So. I I'm a former elementary school, teacher, in a low-income public school and I've, dedicated my, entire career to being an early childhood advocate, because. Of what I experienced. As a teacher in. A low-income school and also all of the incredible neuroscience. And economic research around early childhood and I just have to say it is so exciting to be in the Tax Committee I kind. Of hang out in HHS, and education, so I kind of feel like I've been let out of a cage and, now. I'm here with all of you it's, very exciting. So. Why. Are we here chair. Loon teed, that up for us we, know we have a childcare crisis, in Minnesota, and we, need high quality childcare, but it can't exist in its current market, based financing, system, there's just too much instability, and financial, stress public, policy plays a really critical role in, this. Industry. Parents. Can't pay more for childcare but providers, can't make less and there's a real disconnect for a lot of people why are we paying so much for childcare but child care providers, are making, close, to minimum wage sometimes, even below that in a, majority, of states full-time. Center-based, childcare costs, more, than tuition at the state's public university, and it's. Not. Unusual particularly. If you have more than one child for your childcare expenses to be twenty to thirty thousand dollars a year which is a big hit for anyone, even people making good incomes and we. Know that childcare, can't just be a place to park the kids while. Parents go to work or school as, chair lune mentioned, we, know now that 90% of brain development happens by age five eighty percent by age three, infants, and toddlers are, hugely important, and, all. Later, outcomes are related, to what goes on in those early childhood years so we know we have to have high quality childcare. Available to parents. And high-quality, early childhood programs, are the only kind that provide the significant, return on investment, particularly, for low-income children whenever, you hear the economists, talk about the huge returns on early childhood those, are only with very high, quality programs. We.
Can't Provide those, high quality programs, and what kids and families need without significant, change to the early childhood workforce we. Need skilled, and educated professionals. To be doing this work yet. We, have huge challenges, finding quality staff and being able to pay them enough to retain them our field faces, very low wages it's. Predominantly. Female historically. Undervalued. Work, ratios. Dictate, costs, and it's, hugely, labor-intensive. It costs, a lot you need a lot of people there's. A reason, humans. Don't have litters of children, you, know we typically have one, or maybe two babies, at a time because human, babies, need so much more adult interaction and nurturing and care than, most other mammals, when they're born and that's why we have the ratios we do in early childhood because we know that to do this brain development, we need those low child the staff ratios so that does increase, labor costs, so. In short we, need to attract retain help. Educate, and compensate, our professionals. So that we can educate children and, help others in the state of Minnesota attract and retain their. Employees, and as. Chair lune said the, mechanism. We use to measure quality of, early childhood programs, in Minnesota is called parent aware it's a four star rating system. One. Two, four four being the highest and, at. The end of 2016, about, 22% of, all eligible, programs, in Minnesota, had. Some parent aware rating and any. Type. Of program is eligible public, school programs Head Start family. Childcare center, based child care community, preschools, if it's, a licensed, setting they can all earn, a parent aware rating so, we, had about 22%, of our eligible programs, there we can do a lot better to increase the number of quality providers, available to children and families and, this. Package of tax credits is unique because, each, credit, in it targets a different group of stakeholders and all of those stakeholders have, a role to play in addressing the, child high-quality. Child care needs parents, who choose high quality programs staff, working in those programs owners, and operators of those programs, and businesses. Who want to provide child care as a benefit to their employees, so, this bill addresses both demand and supply and, provides, overlapping, and mutually reinforcing, benefits, within the credits, and. As sorry. I feel like I keep saying as Cheerilee mentioned yesterday we mentioned this, is modeled after a package of credits in Louisiana, that was implemented in 2008. And, has been hugely, successful so. Why would we want to emulate the, Louisiana, model other than the fact that the National Governors Oats National, Governors Association, told, us to do so you. Have another handout, in your packets, its many pages which, is a report, just released about, a month ago by. The National, Governors Association, and, the NGA gave, a grant to Minnesota to study the early childhood workforce and, help figure out what do we need to do to.
Address The child care crisis from the early childhood workforce standpoint. And they, listed several recommendations. The number one recommendation in that report from the National Governors Association, is, for Minnesota to look at a package just like this of the Louisiana, tax credits because it's been so successful in Louisiana, it, has, its achieved, explosive, results, in a short period of time in Louisiana, and our child care industry needs a jolt as do, our parents our employers, and our kids needing, to be ready for school the, Louisiana model, focuses, on child care centers but our bill is around. Child care centers and family. Child care homes Minnesota, is kind of unique in, the country in the number of family child care homes we have across the state and the importance, of that sector, of the industry to our. Economy, particularly in Greater Minnesota so, this bill addresses family, child care and centers. In. Louisiana. Once this package of credits was implemented, the number of quality rated programs, doubled, in the first few years and. Now. They have 75%. Of all of their eligible, early, childhood programs, with quality ratings and again Minnesota, has, closer to 22 percent right now, Louisiana. Also saw an increase in the number of low-income, children receiving, child care assistance who, were served in higher, quality rated, programs. After this credit was introduced, in, Minnesota, currently about one-third of low-income children receiving, CCAP, are in high quality rated, programs and, the percentage, increases are just nuts in how popular, the credit was in, the first four years of the credit in Louisiana, there was a three hundred and seven percent increase in owners, of childcare, facilities, claiming, the credit and to. Claim that credit they had to have a quality rating but they also had to be serving low-income kids so there's a big increase there there. Was a two hundred and fifty percent increase in teachers. And directors and other childcare staff who. Were claiming the credit and the average credit that those staff earned was. Equal, to about, one. Month's, average wages, so, that is hugely for low wage people. In a low wage profession, that, kind of economic. Benefit is huge. And. The. Increase, of people getting degrees in early childhood associates, or bachelors had, an Eightfold increase, and, that's directly, linked to child outcomes, there. Is also a 176. Percent increase in parents, who claimed the credit because they had more access to high quality programs. And. The. Credits have been so successful in Louisiana, that actually, the state went through big budget. Scrutiny. In 2016. And kind of did a review of all of the tax credits they were providing, and many, were on the chopping block and they chose to keep the package of school readiness tax credits because of what it's done for, school. Readiness and access to quality in their economy, so. In conclusion this. Package is called the school readiness tax credits it's not called the daycare credits they take care of themselves we take care of children it's, not called the childcare credit either it's called the school readiness tax, credit because it's so much more important than that. We. Know that if this is tied to quality and encouraging, all these stakeholders, to move up the quality ladder it's a true investment in, the workforce of today and in, the preparation of kids and our workforce for tomorrow and Minnesota.
Has, A chance to still be an early adopter of this effective, and innovative strategy, thank, you very much for considering it questions. For Miss Sanford, riff Schultz. Thank. You mr. chair I am I have a few questions the, first one. Is that. For the quality rating i understand. How economic, incentives, work but we're. Not. Providing. An i think, an incentive, for the we're. Penalizing essentially. The low quality parent. Aware. Programs. Because. They get a slower. Tax. Benefit, and we're. Really, heavily rewarding. The high quality centers. So i think that you. Know it probably takes additional revenue, to move up from a one-star to a four star and, this. Tax benefit, could give them maybe the additional revenue, to invest to improve, quality. So. I would, like. The author's to maybe consider initially. At least you. Know making it more similar tax credit across the quality ratings, so. They have additional revenue, to move up because I'm assuming that we want them all to be four stars. And, that would give them additional revenue. To move, up to that quality rating if if it. Does take additional revenue to improve, quality and I'm assuming that it does. And. I'm also wondering isn't Louisiana. Is there quality rating, very similar, to the parent. Or where quality rating and what are those differences. I'll. Have miss Hanford comment. On the Louisiana. System but you. Know I think it's just to comment. To your first suggestion. You. Know I think it's something to look at and I know you, know in the Education Committee we've kind of struggled back and forth with we, we want providers. To get into the quality rating system and. Obviously the goal would be to get them to move up but. First, the first step is trying to get providers, into that quality. Rating system to agree and because it's voluntary, obviously, providers, can decide to do it or not. If. They are in the system they are able, to take children who receive scholarships. And. They have to have a quality rating to, do that but, the goal again is to to. Make, steps up on that in on that increasing, scale, up to up to level four so whether. We need to provide more incentives for that first star, or, not I think is an interesting idea. So, I'll, think about that miss Sanford. Mr.. Chairmembers, thank, you very much I don't. I'm. Not gonna pretend to be an expert in Louisiana's. Quality rating system as it compares to Minnesota but in general, they, are similar, they, have similar. Requirements for, moving through and demonstrating, increased, education. And training of your staff members they. Have increased. As you move up the Stars requirements, for parent engagement using. Developmentally. Appropriate curriculum. And research-based assessments. Of children and, most. Importantly, I know, in, Minnesota. Has a couple different they're called pathways, we love the word pathways in Minnesota pathways. To get into parent aware ratings. Some. Of them involve, an observation. Of your classroom, by an outside observer and, actually rating the classroom and giving you a score and the score is correlated, to research. Around outcomes, for kids in the, Louisiana program, I believe all programs, have to go through that independent, observation, and they, have to do it three times in Minnesota. I think it's just once but. In Louisiana, they have do three observations and then I think they averaged the scores so, if anything, the Louisiana, model might even be a little more rigorous in, that sense. One. More follow-up Thank You chair David's um, in, the Louisiana bill, did they structure, the credit similarly, that, lower star. Quality. Rating facilities, get less of a tax benefit. Mr.. Chair representative, yes they did okay thank you, sure. Anderson. Thank. You mr. chair I apologize, I came in late tell me how this would apply to in-home. Child care providers. How would they be able to access any, of these credits because I as I understand it the quality rating system has, been challenging. For them to participate in the parent aware program, at. Least let the feedback that I've gotten from my income, child, care providers so how how would that work mr., Sanford mr.. Chair representative, there. Are two ways in which family, childcare providers can take advantage, of the credits in this bill they have to choose one or the other they can't do both.
But, They're two ways family, childcare can benefit here one is through the owner/operator, credit so if you're a family childcare provider you're operating your own, small business and the. Way the credit is structured here for an owner and operator is. Based. On the star rating, of your, of based. On the the level of your quality, rating, and the, number of children using. Childcare assistance or, in foster care that you serve, so it's an amalgamation of your quality rating level and the number of low-income children you serve you. Get increasing. Tax credits based on that but, not everyone serves, low-income families, and right now we really, only have financial incentives, in our parent aware system, for, serving low-income families, both scholarships. And childcare assistance have. Higher financial incentives. If you are serving low-income families, and those providers not serving low-income families, don't necessarily, have that financial incentive, to enter the quality rating system and achieve a rating so, this is one way for family, child care providers to do it the, other way if those family childcare providers don't serve any low-income children instead. Of taking the owner/operator, credit they could take the staff, credit, because they are the lead teacher in their program so based on the rating of their program and their individual, level of education, they. Could get a credit against their personal income taxes, so they would choose between those two. Thank. You mr. chair I'm representing loon I know that you've worked really hard on the whole rating system and so forth can you tell me how we've made the parent aware more. Easy for in-home, child care providers, to participate in. Thank. You mr. chair represent Anderson you know I think that is still a work in progress I know what we are have. Been one, of the things we did in the education. Bill last year there was a requirement. That you had to be three or far star, rated, to get, to. Be able to serve scholarship. Children and that was a pretty, fast ramp up because, not, all areas, of the of the state, received. Sort. Of the, scholarships. And the, infrastructure. For, that to happen at the same time and so, for some of those regions. Of the state that got it last there. Was a very short period of time for them to become three or four star so, we we, stretched that out and so now you could be one, star and still, receive, scholarship, children with again the encouragement, to. Get more providers into the system so these parents will have a range of choices, because. Some in some areas you you may only have one. Provider. That's it's, got a star rating in their area so I still think we've got a ways to go as a Miss Ann furred mentioned it's only 22% of all providers that have a quality, rating right now so, we definitely have work to do. First, oh girl Hagen Oh Thank You mr. chair yeah, thanks for bringing this bill forward it, definitely, highlights, a severe, crisis, in my. District, which is a rural district, and I even had one small community, have a special, community. Meeting to try to address the crisis, of day, care for the children for whatever reason, we have more and more daycare. Providers, seem to leave the the. Businesses. Then entering. There. Might be additional reasons, but you know one of the things I have seen is in. My district, is we've had a church, step, up and buy a closed, childcare, facility, that was not on their, property and, was, not connected, to the church and. They, were assessed, property, taxes, of about eight thousand, dollars for doing something like that which. Of course they have to pass on to the children so. I see you have a credit for businesses to build or renovate a childcare facility well that's exactly what they did. But. It, I don't think it would apply to. Nonprofits. Or tribal, I think it's 503 see if I remember right but. You. Know to me nonprofits. Or churches would be an excellent way to expand, daycare, if we would help them with. Their facility, and I don't know if that's something that could be included or is. There anything in here that would help a non-profit. Like, a church, that decides, to offer something, like that in terms, of a. Credit. The. Way I read it I don't I don't see that. Mr.. Chair I would defer, to nonpartisan, I guess I wouldn't know in that specific instance how, that, could. Work. Mr., chair represent of Grune Hagen so a non-profit, facility would not qualify for the, credit for businesses that build a renovator. Sort, of pay for their employees childcare but. Employees, of that childcare, center would be eligible for the, third.
Credit In the bill for individuals. That are employees, and then people, who send their children to that facility, if it was parent aware rated would be eligible for the credit, sort, of against their payments, of child, care services. Or. Just final comment is maybe it's an area we could look at down the road because I think there's a lot of churches out there would would, be willing to offer this type of service if. They wouldn't be penalized with. Property taxes, for, doing so and of course we know that has to be passed on to the cost of the children. All. Right thank you mister thanks, I'm brewing hey Gramps are Loffler, well. Thank you mr. Gerron and this is a big, issue for our state and I appreciate. Your leadership on, trying to find ways, to deal with it represent alone I spend more time in the Human, Services Committee and I'm not on education, as you know and it, feels, to me like this is a project. That's probably, would be great for us to consider a few years down the line when we've actually dealt with some of the much more pressing issues in this area. Because. We don't have a stable system that's accessible, to families and then trying to move them up we. Instead have a system, where we have incredible, shortage, of childcare providers, across the state. To. Get into, the the parent, aware program, is really expensive as. Representative. Anderson, has pointed out it's really a challenge, for for, many providers to get, themselves. Or their employees through the the training programs to get stars, and. If. You're working in childcare and you're working 11 hour days you. Don't you can't go to classes, at night you, know I mean you usually have your own family to take care of we. Haven't developed online, training, we haven't developed the infrastructure, to really get them through little loan affordable. Scholarships, for the workers. And, so the reality is that I mean the last time I looked and this is is some time ago if I had a scholarship, of my area there was almost nothing that would be available for my me and my child and, I and I know the problems even worse in in rural Minnesota in, child. Care assistance we. Have a, 2,400, families. On the waiting list. To get and many of them wait over a year to, get any kind of sliding fee assistance and so. Those. Kids I've always wanted the university to do a study what's happening to those kids when. They can't get affordable childcare at all and they have to be very low income to qualify. And. So, to, me if we're going to spend a hundred million dollars, I'd. First try and get rid of the waiting list I try, and provide, total. Scholarships. To getting work force people into programs, because, tax. Credits don't work if you're living paycheck to paycheck which is what most of our childcare workers, do they, can't wait to get it back after they've, filed their taxes, after the end of the year that's just not a good. Solution and our, pay scales are so low in this industry that none. Of them are above paycheck, to paycheck unless they're and in, an in advantage, program, and the scholarship, program I think began with really good intentions, but the reality is for lowest income families, it will not cover a year of care. And so, they can't take. Advantage of, it even if they qualified, it because it isn't sliding fee it isn't, year-round. Eligibility. They can use up their scholarship, before they get to the end of the first year and so I really. Feel like I, like. This concept, but I feel like you're you're ahead, of where the service system is right now and.
If, I had my priorities I'd put it into those, thousands. Of families on the waiting list and. Making. This scholarship, program sliding. Fee so that it can actually reach meet, the needs of low-income families. And. Increase, our reimbursement rates, which now I think are less than 25 percent of the median market, so. It's hard to get people to take. Subsidized. Children, when when the reimbursement, is that low so, I don't want to discourage you but I want to say right, now I think we have to worry more about those 2,400, families, that, are eligible that are waiting almost a year to get into anything and. And. Look at some real full scholarships. For, those low-income workers getting, into the the workforce, training programs, that you're trying to incent. But. I'm I'm glad to hear that you have a subcommittee working on figuring out how to do this and looking at all kinds of different ways to do it. Well. I think mr. chair and represented Loffler you know I think I. Think, you raised some really good points I mean I think there's a lot of things that we could look at doing and, and, and I think certainly the the reimbursement. Rate and the C cap rate, is. Very, low and, doesn't, provide low-income. Families, with many options and I, think the scholarship, comment as one I think we could do more of a scholarships, but I think again. The, other the. Other I, guess. Point I'm trying to get out with this bill is that you need to do something to incent the marketplace, to step in as well we could provide scholarships. And that but we still have a problem with the, number of providers and, and. Doing something to try to incent, whether, it's employers, stepping, in to help provide. More. Of, a benefit, to to, their employees. For for the cost of child care and helping, that be paired with quality, or or some of the other ideas in this bill I think we need to do something to get the marketplace. Kind. Of energized, if you will or, ready. To be to, step up to do to meet the needs of Minnesota, families, which we're just not doing right now. No. I appreciate. That it's a really tough issue and it's gonna take big money like the kind of money in this builder to, make it move forward I just feel like, we've. Gotta deal, with some of the basic foundational. Pieces maybe before, we go to to. This much and incentives. Chair. Marquart thank. You very much mr. Jared and my. Neck of the woods were losing some daycare providers, and a lot of its regulations. But this certainly you, know would help, and. I like the idea of rewarding. The three enforced, our parent. Over because that's where we want to go my. Concern. Right now is, and. Maybe some of the other legislators. Have mentioned this is kind of it, seems to be rewarding, the third three, and four stars which is good and. They're going to continue but, I don't, know if there's enough help here for kind of these areas that have low access to. Three and four stars like in rural Minnesota right, now where there, aren't a lot and, so. I. Just don't know if this is gonna looks, to me it could exasperate. You already have, people who have access to good three and four and they're going to benefit, and the other ones aren't, and I don't know if this is going to bring, it up or actually divide. It and so, I mean are there what are the efforts right now especially. Out in rural Minnesota but, around, the state to move, the. People. To 3 and 4 stars I mean that's where I'd like to see a real effort. Being made right, now and then would you happen to know out. Of the, spending. What, percent, would be Metro, and what percent would go to rural because I just, have a feeling that in. Rural areas, there just are not a lot of three and four stars as compared, to the metro but I might be wrong on that so would, you happen to have a breakout, as far as of the, 90, million what amount. Initially would go to Metro, versus, rural and and then what are you doing to try to build up the one, in two stars that get them to three in four stars.
Thank. You mr.. Chair and representative Marquardt, I'll, have miss Sanford address some of that but again as I, commented before, I think we need to do more to incent. Providers. In the rural areas, to get into the star rating, program this has been sort of a. Long-standing. Or, a continual, push to try to get more providers, in and I think, first. It was availability. Of scholarships, and whether, it was worth their time to get in if there was going to be, scholarship. Families available, because. That was ins that was the only incentive, for, the quality rating system and. And. So. I think that's one thing and the others representative. Loffler, highlighted. So. And then we've. Just had more and more providers, especially, home-based. Providers just, get out of the business and so getting. People to start up a business. Is. It's just very difficult because. The hours are long the pay, is pretty low. And. So it's, it's a combination of those factors so I'm not sure how we how. We do that we've done some other things through deed to provide some incentives, for. Childcare. Providers, through grants, and that. Through through deed through some of the budget funding that we did last year I don't know if some of that is being contemplated for supplemental, or not but I. Think there's some other things we could do to try to again try to get some, of them new. Facilities, or our, providers, home-based providers up, and running and. I'll let miss Sanford, add anything she'd like to share my reports question Thank. You mr. chair thank, you. Really. Quick answer for your question about Metro versus rural I have. No idea okay. There. You go it would be good to know I mean those are the kind of things obviously we want to know and when implementing, policy, and I, don't know who, would figure that out but I would. Like to know that as well and in. Terms of what else is going on in the state - and sent more, people, to, get into the quality rating rating system and move along the Stars I just.
Want To say totally. Agree with everything this is not a panacea, we couldn't just do this and solve, the crisis I mean even the. Report. That. You have the executive summary of says very clearly even though it's very glowing. Of what these tax credits have done in Louisiana, it says you can't do this alone you have to have a robust, child care assistance program we. Have to be paying attention to regulations, in Minnesota we after you paying attention to the impact of what universal, pre-k could do to, the child care market any, one of those things won't be enough we have to be looking at all those things together and we have to do more than one thing so I couldn't agree more with all of that stuff. In. Terms of incentivizing. People to get into parent, aware as. Cheerilee, mentioned a few, years ago you did have to be three or four star rated to accept scholarships, and a. Lot. Of people said I'm not going to enter parent aware because it seems like a really long, jump, to go from zero stars, to three right off the bat that seems like a lot of work I have to do and some find financial, outlay before I can even get to that financial, incentive, so, the law was changed to, go, back to something more like this bill where, it says now you can be any star rating up until the year 2020 so, that people who earn. One star and want to move to the second star in the third store star do have some access to those financial, incentives. I don't. I. Can't. Remember what we're doing with CCAP. Differentiated. Reimbursement. I know. It's the highest four three and four star we. Used to differentiate reimbursement. For, one, and two star as well although, I don't want to I'm not sure if we just continued that or not so I don't want to say something incorrect, but, those. Efforts are, ongoing but, again. They're only if you serve low-income kids can you get those financial, incentives and that's why in this bill one. Of the credits is tied to how many low-income, kids you serve but most of them are not so, everybody. Whether they're in a community that serves low-income. Children or not can, benefit, from these financial, incentives. We, represent Wilson then we'll go on to miss Davis and miss Potts, represent. Wilson Thank You mr. chair and thank you representative, loon for working on this and. I, just spoke with a friend of mine who. Is an, in-home child care provider. And she is considering. Seriously, considering going, to unlicensed, and just caring for one family because. She can't. Keep. Up with the paperwork and regulations, so it is a concern and. We. Need to work on that front as well but I just wanted to briefly, respond, to.
Representative. Marquart question, about the rural versus. Metro. And if. Am I looking, at the bill and maybe staff can correct it doesn't seem there's anything that. Creates. Any kind of differentiation, or percentage. Based. On geographic. Area and, I. Don't think we would want to do that because I think we wanted to if we move forward with this language we. Would want to make sure that the credits were available where the need is not, an arbitrary location. So. Justified. Thank. You mr. chair miss, Sanford would. It not be. Prudent. For DHS. To offer an online course, free. Of charge because this is such an important issue to, providers, so that they could move up in the star rating because, I know there must be a way, to develop an online course to help them move. To that higher rating, would, that not be frequent idea, for. Mr.. Chair representative Erickson. In. The, early childhood world, access. To free and low-cost training. Is huge, no. Matter where, it comes from whether, it's DHS, or someone else in order, to qualify for parent. Aware ratings. The training has to be approved by parent, aware and it. Can be approved if it comes from. Companies. Individual, trainers you know anyone can submit training to have it approved, and, it would definitely and. This is something I know DHS. And the parent aware system is working on we do need more, online. Training, available especially for, Greater Minnesota because. When you have to travel great distances and, there just aren't as many trainers in those areas in order, to get, the, specific training, it's very specific training you need to get to move through the parent aware rating, levels and we, do need more of that online, and easily accessible to our providers and. Esther. Chair and miss Sanford the reason I bring it up is DHS, sets the regulations. Which. Is you heard representative, wills and others say is a barrier, represent, Marquart noted it it certainly, is is hurting, us in rural Minnesota so. They, should be I think a, prime, mover in this effort so that, we are. Able to provide, the quality that we're seeking, and also. Keep providers. At. Work. In especially. Rural Minnesota. Because. They have access to something that can really help. Them so I you, know I think we. Should encourage DHS in that direction. Okay. Let's any other questions from Miss Sanford otherwise thank you very much miss Sanford will now go to MS, de Vos and, then. Miss. Potts. Please. State your name who represent for the record please good. Morning mr. chair members of the committee my. Name is Karen DeVos I live, in a - Minnesota, I owned. Little Learners Early Childhood Center, I also serve as director and, teach, preschool, there. Thank. You so much Little, Learners is a parent, aware rated Center we, are the only Center, in Norman County we. Are located on the same campus as a nursing, home and assisted living facility, we, are fortunate to be able to partner with the nursing home to provide extended, our care and discounts, for their employees, as, well as work with their activities Department, to be able to enjoy intergenerational. Experiences. With, their residents on a daily basis it. Is a blessing, to have the opportunity, to watch those relationships. And the people of both communities, thrive. Little. Learners is located, in a small rural community and the, market does not allow for us to charge what it truly costs. To run a business such as ours our. Teachers do not earn what they deserve they. Work long hours for, little pay and limited benefits, as a, center, we barely break even every. Month with, the majority of our income going right back into employee, wages food, costs, and training, and education, fees, like. Most who work in early childhood we are not in this business to become rich but. Rather to change our world by helping to grow and educate, the amazing, little people that we are blessed to work with every, day. The. Tax credits, that have been proposed in this bill would help in every facet, of our business, credits. For our teachers would put dollars directly, into their pockets enabling. Them to be able to continue, their very important, work and encouraging. Them to also continue, their learning so they can be the very best teachers. Tax. Credits for parents would encourage families, to seek out quality, care in education, for.
Their Children as well as help them with the rising, costs of child care. Tax. Credits, for business partners could potentially, encourage, communities, to look at these types of partnerships and affect. Change in the ever-growing childcare, crisis, and, tax. Cut for early childhood providers will. Not only encourage, those providing, care and education, to maintain high levels of quality but. Could also help in the budget to, provide a more livable wage for those working, directly with our children, for. My Center those. Credits, would go right back into the pockets of teachers to increase, wages and, to, reduce the child to staff ratios, I. Just. Want to share that I left ADA at 5:30. This morning, to. Be here today um. As, soon as I'm finished testifying and I'm done with the hearing today I'm heading right back home where, I will close the center for the day. Now. You sound like my husband he says it's never a guarantee um. I should. Not be here today we had an extremely, emotional day at our Center yesterday, I've. Been doing this business for twenty years working, in center care and in family childcare and. For, only the second time in the 20 years that I've been doing this we had to let go of a child yesterday due to behavior concerns. This. Little girl has been in foster care for the last eight months she was placed with us a week after entering foster care. Two, months ago she found out that she was no longer going to be able to go back to her biological family's, home. That. Led to a, lot, of behavior issues and we had to bring, on another teacher. Specifically. For her. We. Do not have it in our budget to provide an, extra, teacher long-term, and so, yesterday we had to say goodbye to this little girl who. Did not choose this situation, who. Is brilliant. And, so. Loving and who. Is going to go a long way but unfortunately not, with our help, these. Credits. Could, make all the difference for kids like this we, serve 18, children who. Are on child care assistance or, scholarships. We're, licensed for 39. It. Was not an easy process to get parent to wear rated we started at a one-star, we built our way, up we, did it with the grants that are made available through, parent aware they have building quality grants, that help provide education, for my staff they. Help purchase new supplies, and toys for, our Center though. That funding is available if, you are willing to utilize, it. We, do see I think I'm only one of two or three. Parent. Aware rated facilities, including, family childcare in our county I really. Truly don't believe that that's because, it's. Too expensive or, it's too difficult I think it's because there's they, don't need to there's. A demand, and, to. Go through the extra work it. Is a little bit it's. Not really necessary, um I. Just, I really want to encourage you guys to take, a good strong look not only at this bill which, i think is amazing and and can really help a lot of different areas but. Also to look at early childhood as a whole. All. Of the statements that were made here today are important. The huge, push needs to be made to change where. Our state is going and I really think that we can do it and I really believe that this tax credit pill is a start thank, you so much thank. You how far from, Dulworth. From. Dilworth about. 37. Miles, depends. Different. Class. Cougars. ADA Borup cookers we are an amazing, girls basketball team, yeah, awesome, yeah awesome, okay. Let's, focus great okay. We're, so mark well thank you very much mr. chair, thanks mr., Voss for. Traveling. From ADA, so it is quite a jaunt. So it's, appreciate. You being here but thank. You for your testimony, because I think you know you're talking about the only day, care center in Norman, County and you said what two or three possibly, at the Storrow we're rating. Some that are star rated in the entire county, yeah. So I mean I think it really illustrates kind. Of the concerns, is, you. Know and something like this can only help but. It's a much larger. Concern just a shortage, of those that would be able to get to the three and four star rating. And. I, appreciate. You bringing that up and. You. Know when we've, just kind of I know there's task force out there and we're looking at regulations and, the whole works, but, it's. Becoming a crisis, the. Shortages, of daycare and there's to, see good ones like yours, mr. Voss is great. To see out in rural Minnesota but, it's, sometimes. Far and few between and. We're losing them more than gaining them and and. So whatever we can do so. I mean something like this would certainly help. It's, part of the problem but thank you again for coming down for me - thank you questions. For mr. vos. Thank. You very much thank you coming for add-on from Aida okay.
Let's Go to, miss. Potts. Please. State your name and who you represent for the record please. My. Name is Jeanette Potts. Thank. You mr. chair and members, welcome. Committee thank, you my name is Jeanette Potts I am a former formal. Thank. You, parent, aware traded family child care provider and the early childhood educator. And. Just. Coming to get my thinking, hello give, my testimony or, to speak on the tax credit in this this bill and how important it would be for family. Child care providers okay. Okay, um. This, bill would mean a lot not, just an actual income or. Economics. To providers but also. Knowing. That this comes from our government from our state recognizing, the work that we do is. Really important, to family providers it's a morale boost in. The work that we do sometimes we feel undervalued. Unappreciated. But. Knowing that our state and our government really recognizes, the importance of the work that we do and that you would support a bill like this to to, help us is, greatly appreciate, it. Wages, are low in, the childcare industry and, it's, a main driver why people either leave the industry. Or, not, come into it. Providers. Are committed to serving, low-income families, we face multiple, multiple barriers and generating more income I, remember, taking a class when, I was doing family childcare and they, wanted us to compare. And. Get rates and so we had to go and find, out what rates were in other, communities and then what the reimbursement, rate was and then they tell you you know set your own rates and my, family. Childcare was in North Minneapolis and, in, order for me to set my rates where. I wanted, them to I had to reconsider, because, parents in my community, majority. Of them probably 90 percent if not ninety five percent were on. Childcare assistance and, so, asking him to pay the rates that I would prefer to be reimbursed was not a reality, because, that would mean that they would have to come out of pocket to pay the difference between what I charged and what the reimbursement. Rates were from the state or, from the county and so, that's, often, difficult for families. To do and, so then as, providers, you're often limited. To setting your reimbursement rates, to what the. Seacat, rates are. So. The parents in my community they. Can't. Afford to pay. More. So. This tax credit bill would really help. Most. Of the parents like I said use child care assistance and, they can't afford to pay anything beyond their reimbursement, rate I wanted. To charge more but I couldn't, and in. The community I serve it's just not it's just not reasonable to do that it's not a smart business move my. Income was limited not, by the quality that I that, I provided to the family or the law to each of my families, but, it was due to the reimbursement. Rates of which are far too low. The credit in this bill would reward providers committed. To educating children from low-income families that. Would help immensely just. Knowing that the tax at tax time there was an adjustment that would help me remain, financially. Viable, and, able, to serve my community, many. Child care providers. Barely. Break even some. Pay themselves far below the minimum wage after, expenses, when. You're in a tenable economic. Situation. Any. Surprise could be a huge setback, and. Family. Childcare you sometimes hit with things that any homeowner would be hit with but, it just doesn't affect her family it also affect the children and families that you serve there. Was a time when, I was in child care that my basement flooded due to a flood that we had and so.
When. It flooded my sub pump failed so, I had to get. Myself hunt replaced I had to get some drying equipment to, dry out the basement and tons. Of other work that needed to be done for me, I had to make a decision what to do at. That time because, it wasn't just myself that. Was hit with that same flood but many providers were they created an emergency. Emergency. Grant to help fix that but had, that emergency grant not been there that would have been a huge setback for me, there. Are things that happen, as a homeowner, they. Sometimes you have no control over and that you do have to fix so so sometimes you have to worry you, know droplet this on my credit card is this gonna you, know affect other areas of my life is am I gonna have to now try, to raise rates. Which in my situation you can't so you have to wonder what you what you're going to do. So. Sometimes our decisions have to be made. When. You win your family childcare provider, knowing. That there's a little extra help available at. Tax time that. Would make some of these I take some of the anxiety, out of the moment I love. The fact that this bill also provides incentives, for child care professionals to further their education and. They, reward them for doing so these, additional funds can help take the edge off when people are contemplating. Furthering their education for. This career or abandon, it all together for, something else it, could also help people see that while there, may be another job for, the dollar more an hour. They. Could they could also stay in this career, that, they love and recoup the cost at. The end of this at the end of the year through, taxes, our. Field is consistently, losing. Providers, to jobs requiring less education, and skill, due to wages this could help stop that flow. I personally, when, I was family, tracker provider monthly, parent aware godparents were rated started out with the one star I do like the fact that parents where I have the incentives, in there I did go back to school to further my education ended. Up getting my associates degree and would love to continue my, education because. Of that I was able to become for a star rated. And I like the fact that we do have programs, and systems in place now through parent aware to help providers get there I do hear, a lot of talk today and I wasn't, aware of all the problems, that we have in the rural areas, and, I know that this one, thing, will not help cover. The whole, issue. With, the childcare but it is the beginning is the start we, had a staff. Meeting and someone, came to speak at our staff meeting to talk about what's what, possible. Texas, centers could do and the. Staff after, hearing what something like this could do for providers. And professionals in, our industry they, were all excited. And all happy so although it won't address every issue it, would help keep some, of the people from. Leaving our field. Being. In childcare I have had teachers say you know I can afford, to stay here I have to take a job I have to feed my family I have, student. Loans and this, just isn't paying enough but, having something extra, come in that, can make a make or break a person, or make, that decision to stay in here in this, field and we do need people to stay. Thank. You very much mrs. Potts any questions, for mrs. Potts. Okay. Then Carolyn. We'd like to wrap it up Thank You mr. price thank you very much thank you thank you well thank you mr. chair again. I think um you know obviously a kind, of a large, bill to think about in terms of just both the impact and potentially, the cost of it but, I'd. Like to think it's a creative idea of trying to provide, some possible, solutions to help us increase, the supply of quality, childcare, help. Parents afford, what. Is a very, expensive. Thing when. You've got young children and, also try, to incent, more people. To stay in this really important field we need it our economy needs it, most. People that are in the workforce many, of them have young children and so it is very. Important that we address these needs so with that I just really appreciate the committee's, interest, thank. You very much Geralyn, Geralyn renews. Her motion, that house file 3053, as amended, be, later for possible inclusion the omnes tax bill Thank You chair loon. You.