Minnesota town of 1,500 passes sales tax to fund childcare

Lindsey Buegler at the Little Sprouts child-care center
in Warren, Minn. (Photo by Dan Gunderson, MPR)

What was once a childcare challenge is now a crisis, with rural families feeling more of the pinch to secure affordable, healthy childcare. 

Warren, Minnesota, pop. 1,500, was one city that decided to address its shortage of childcare with innovation. In November, Warren voters became the first to approve a local sales tax dedicated to supporting a childcare center. The approval was unexpected since the tax is for a service many Warren citizens won't use, reports Dan Gunderson of Minnesota Public Radio.

Lindsey Buegler was a Warren parent who needed childcare. She told Gunderson: "It was either get involved and beg and plead with people to somehow keep the daycare open or we would have had to move. There were seven of us directly involved with the center that would have had to move. . . . I would say that's huge for this small city of Warren to lose seven families."

City officials "partnered with the First Children’s Finance Rural Child Care Innovation Program" and found "a shortage of 187 childcare slots within a 20-mile radius of Warren," Gunderson reports. "The research also found more than 30 percent of survey respondents had turned down a job, or withdrawn from the workforce because of childcare issues."

Map from City-Data.com

Using those facts, the city proposed a half-cent sales tax, and to the surprise of many, voters approved it, making Warren the only city in Minnesota with a tax for that purpose. "Business leaders pushed hard for the tax. They understood how a shortage of childcare was limiting economic growth," Gunderson reports.

Construction for a new childcare center will begin in the spring 2023 with funding coming from the new sales tax proceeds, community fundraising efforts and a low-interest loan from the Department of Agriculture, Gunderson adds. "The childcare building will be owned by the city and operated by the Little Sprouts nonprofit. City leaders expect that arrangement will help make childcare more affordable."