The state House Children and Families Finance and Policy Committee recently heard a bill that aims to reduce the cost of child care for Minnesotans.
The bill calls for a scholarship program for families needing child care for young children and aims to prevent Minnesotans from spending more than 7% of their annual income on child care. The scholarship applies to care for children from birth to kindergarten entry.
Bill author Rep. Carlie Kotyza-Witthuhn, DFL-Eden Prairie, said the goal of 7% is an affordability benchmark set by the Department of Health and Human Services in 2016.
The benchmark doesn’t accurately reflect current costs, according to Alaina Skoglund, a mother of two children and a child care teacher at Minnesota State University Moorhead.
“We pay $1,200 every month for child care for Dean, and we also pay $1,200 every month for child care for Harvey,” Skoglund testified to the committee last week, referring to her two children. “That’s almost $30,000 a year. It’s my entire paycheck, plus some of my husband’s paycheck to pay for our child care.”
Family income spent on child care
The average percentage of family income spent on child care in Minnesota is 18.8%, according to the Economic Policy Institute . EPI data as of February 2025 identified Minnesota child care — reportedly averaging $22,569 per year — as the third most expensive in the United States. Massachusetts child care averages $26,709 a year, and Washington D.C., child care is estimated at $28,356 annually, according to EPI.
Scholarship money is allocated to day care providers, under the bill, and eligible families then receive discounts on their monthly payments. The bill states that children who receive the scholarship must continue to receive the scholarship each year until they are eligible for kindergarten.
To be eligible for the scholarship, families need to make “less than 150% of the state median income.” Eligible families will receive a minimum of $100 per month, according to the bill.
‘A very expansive bill’
Kotyza-Witthuhn said that based on how many Minnesotans it would apply to, the bill will cost around $500 million per year.
“This is a very expansive bill, in that we would be attempting to provide somewhat of a subsidy to 85% of the children and families in the state of Minnesota,” she said.
Kotyza-Witthuhn said she sees the bill as an investment in Minnesota’s child care system.
“This program is not about throwing money at a problem, but it is a series of precise policy changes and fiscal investments to reform early care and learning in Minnesota,” she said.
Scholarships would be awarded over a 12-month period and require annual renewal.
If passed, scholarship payments start no later than July 1, 2026.
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