Child care bills fail but give rise to optimism about study and task force

All three bills addressing the child care crisis failed during this year’s legislative session, but the session was still a success, said Sen. Tim Reed, R-Brookings. 

Reed has been leading the legislative effort to study the problem and has formed an informal task force to find potential solutions. The 2024 legislative session ended Thursday, except for a day on March 25 to consider vetoes.

South Dakota suffers an estimated $329 million loss in productivity due to its inadequate child care landscape, according to a study from ReadyNation, a nonprofit organization focused on business and economic development across the country. South Dakota businesses aren’t “producing what they want to produce” because of child care limitations, Reed told South Dakota Searchlight earlier this year.

Communities from Rapid City to Platte to Madison are struggling to keep child care facilities open and affordable for families in South Dakota. And out of the roughly 58,000 children who qualify for income-based child care assistance in South Dakota, only 5% actually receive the subsidy, according to a study from South Dakota Kids Count.

Two of the failed bills would have made it easier for some low-income parents to receive child care assistance (one bill was tabled at Reed’s request), and the third would have required the state Department of Social Services to conduct a study of child care costs throughout the state.

Reed said the bills making it easier for some low income parents to receive child care assistance were addressed through email conversations with the department after the bills’ introduction. Child care experts alerted Reed and others that parents who are homeless and looking for a job have trouble meeting child care subsidy rules that require them to work or attend school. Additionally, parents who are afraid to contact an abusive ex may have difficulty complying with requirements to pursue child care support before qualifying for assistance.

After those discussions, Reed said there needed to be more communication from the department and awareness among child care providers and parents who qualify for assistance about what exceptions are already in place. 

“I think sometimes the rules can be a little hard to decipher, but they are correct and they do state what needs to be stated,” Reed told South Dakota Searchlight.

The department already studies child care in South Dakota to set its reimbursement rate for the child care assistance program. It conducts a market based study in addition to a cost analysis. The department recently started a workforce study, at the request of the governor.

Reed said the department has agreed to expand its work to meet the needs of the proposed study. The department and the task force will meet later this month to outline what is needed in the report.

State lawmaker seeks study of child care costs and unused subsidies

“The main success is getting that child care study done, because it’s going to give us the base to know what’s needed and how much it’s going to cost to provide so we can start disseminating that information out to the business community and everyone else,” Reed said.

The study report will be published in October, Reed said, and the task force will try to finish its work at the same time. The group’s scope will cover the state’s role in supporting and regulating child care, how other states are addressing the crisis, and its economic impact. Once the study report is published, Reed plans to use the information to inform possible legislation or work with private and nonprofit partners to address the crisis outside of state government.

“I think this is going to be a lot more about the whole state coming together than the Legislature doing something to solve the issue,” Reed said. “We don’t have the funding at the state level to just start subsidizing child care more.”