How Iowa's rural child-care crisis cost this town of 5,000 its only day care center

Kevin Hardy | The Des Moines Register

Show Caption Hide Caption A creative partnership helps Curious Kids Childcare serve more families As some child care providers in rural areas of Iowa struggle to keep their doors open, Curious Kids Childcare found a creative solution.

IOWA FALLS, Ia. — Stacy Williamson has relied for months on a patchwork of friends, Facebook solicitations and even her own boss to watch her 6-month-old son, Gabriel, while she works.

It has always been difficult to find child care in Iowa Falls, population 5,048, the single mother said — and that was before the city's only child care center closed Nov. 2.

"It's next to impossible to find someone," said Williamson, 25, who works full time as a clerk at a Casey's general store.

Officials announced Oct. 17 that Riverbend Child Care would close on Nov. 9 after months of fiscal insolvency. But the budgetary crisis was so severe that officials shut the doors a week early.

"I think it’s screwing a lot of people over, especially with such short notice," Williamson said.

More: Here's the true cost of child care in Iowa (It's more than housing)

Skyrocketing day care costs and long waiting lists have only grown as child care slots vanish, particularly in rural areas.

For many Iowa families, child care is now the most expensive household budget item — more costly than housing and healthcare. One study calculated the average child care cost in Iowa at more than $1,000 per month, meaning many parents pay more for day care than they would for a full year of tuition at the University of Iowa or Iowa State University.

That is, if they can find it. Parents in all income brackets struggle to find childcare, but the challenge is especially pronounced for rural residents.

Research from the liberal-leaning Center for American Progress shows that 715,404 Iowans — about 23 percent of the population —live in child care deserts.

But the rate jumps to 35 percent in rural places like Iowa Falls.

"It's a crisis," said Dawn Oliver Wiand, executive director of the Iowa Women's Foundation, which has made child care access and affordability a top priority.

A lack of slots plagues parents

Early Childhood Iowa estimates that more than half of all children in Iowa don't have access to a child care space. Many census tracts in Iowa have no licensed providers. But instead of increasing inventory, slots are disappearing across the state, particularly in rural Iowa.

Between 2013 and 2018, licensed and registered child care providers in Iowa dropped from 9,384 to 5,426 — a 42 percent drop, according to Iowa child care Resource and Referral. Total child care slots dropped by 6 percent over that period.

More than 116,000 Iowans live in census tracts with no licensed care providers.

As communities reel from long waiting lists, advocates are pushing businesses and governments to embrace child care as a key component of community vitality — on par with housing, jobs and schools.

"It is no longer a family issue," Oliver Wiand said. "It's a workforce issue, it's a business issue, it's an economic issue."

'I thought it could be saved'

Riverbend has operated in Iowa Falls nearly four decades. But for about the last two years, the nonprofit center was managed by a board of directors with only one member.

Iowa Falls City Manager Jody Anderson said city officials recently got involved, helped fill the board and began looking at the books. Anderson's analysis found that the center needed at least $10,000 per month in revenues to cover payroll.

"They were nowhere close to that," he said, "and that leaves a lot of things unpaid."

With low revenues, Anderson said they worked to raise funds privately to make needed improvements in the aging house turned day care center. But enrollment continued to fall, making the operation unsustainable.

"I thought it could be saved," he said. But "when you need $120,000 a year and you’re bringing in maybe $40,000 or $50,000, it just doesn't work."

The city has worked with advocacy groups and the state to help families find other options, mainly with in-home child care providers. But that's proven an imperfect solution.

Most of the in-home providers — if they have space in the first place — don't take families that use state child care assistance, a public benefit for low-income families. Some providers charge more than the state will reimburse, but others decline to participate in the state program because of paperwork, regulatory requirements and reimbursement delays.

"That’s really kind of a deal breaker for a lot of folks," Anderson said.

Iowa's reimbursement rate for preschool-aged children in child care centers will increase to $13.53 per half day in January. That's about $135 per week for children attending five full days.

In all, the situation creates a difficult choice for families: For many parents, particularly lower-income workers, the costs of day care can outweigh all else in the calculus of whether to work.

"Those are people who would like to hold a job, they’d like to improve their circumstances," the city manager said, "but if you’re paying everything to a day care person, then it really doesn't make any sense for you to work."

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'We can't say we're meeting the needs of our community'

Iowa Falls calls itself the Scenic City — and with good reason.

The namesake Iowa River snakes through town, with downtown shops in walking distance of its stony bluffs. The Scenic City Empress docks here for summer and fall cruises.

Iowa Falls, like much of rural Iowa, has suffered through decades of population loss, as people leave for larger cities. But a steady exodus doesn't negate the need for basic services such as child care.

In fact, rural depopulation has exacerbated issues of access and supply, particularly in housing, as developers focus most of their attention on fast-growing metropolitan areas.

Previously: This map shows the stark reality of rural Iowa's population loss

Located at the juncture of U.S. highways 20 and 6, much vibrancy remains in Iowa Falls.

It's home to major institutions such as a hospital and community college. And boutiques, restaurants and professional offices fill most of the storefronts that line downtown's Washington Avenue.

But that doesn't solve the dilemma for parents such as Williamson, who now drives out of town before and after every shift for child care. She also pays $25 more each day than she did at the Iowa Falls center (not counting gas) — money she says is "well worth it" to find high-quality care for Gabriel.

Her situation was complicated by her use of state child care assistance and her son's age.

"I’ve looked," she said. "But with an infant, there's people who will either accept infants and won't accept state pay, or there's people who will accept state pay and won’t accept infants."

More: These maps show how which Des Moines neighborhood you're from can shape your future

On the same day that the Iowa Falls Times-Citizen published a story about the town's day care center closing, it also distributed news that the local Hanson Family Hospital would cease delivering babies after its only specialist leaves in November.

In an Oct. 17 editorial, the newspaper sounded the alarm on the community's future.

"How can we expect a business to choose our community if we can’t provide its employees with care for their children while they’re at work?" editors wrote. "As long as we fail to provide care that’s accessible and affordable for all families, we can’t say we’re meeting the needs of our community."

'You have to get businesses involved'

Other communities are turning to employers to help.

In Centerville, about 150 miles south of Iowa Falls, Lee Container has opened a new day care center that advocates believe could serve as a model to address day care shortages.

"You have to get businesses involved," said Oliver Wiand, with the women's foundation. "And businesses really need to see that this is impacting their bottom line."

Lee Container's plastic jug factory has grown exponentially since its 2008 debut in Centerville, population 5,400. But President Robert Varnedoe said the company has had retention problems since day one in its Iowa plant.

The current labor crunch isn't helping — Iowa's October unemployment rate of 2.4 percent was the second-lowest in the nation.

Varnedoe said he thought about increasing wages, but he said the company already paid a competitive rate.

"Our wage is what it is because it’s what our customers allow us to charge," he said.

With women comprising about 80 percent of the employee base at Lee, it became clear that a child care benefit could offer a competitive advantage in recruiting and retaining workers.

Varnedoe said helping with child care is "the right thing to do" for employees.

"It's not costing the company a whole lot of money," he said. "Sometimes you just do things in your heart even though you're in business to make a profit."

'There’s absolutely no way possible I could have done it'

Still, Varnedoe didn't want to be in the day care business, so he partnered with Michelle Brooke, who operated a one-room center out of a private school building.

They agreed to move her Curious Kids child care into the recently vacated Garfield Elementary School. Lee Container, which spent about $200,000 to purchase and improve the building, covers the maintenance and utility costs. It also subsidizes costs for employees who use the center. Brooke handles payroll and daily operations.

So far, only about 10 company families have utilized the program, but Lee Container plans to start advertising heavily with its staff.

While the day care is open to all community members, factory employees pay a fraction of the market rate.

How in-house child care helps retain employees UnityPoint Health has been providing child care for employees for 52 years and it has been a major factor in attracting and keeping quality employees.

Brooke has dramatically expanded her program, which she said would have been impossible on her own because of the high-cost of facilities. The partnership has also allowed her to raise staff pay — a chronic problem in a low-wage industry that wrestles with constant turnover.

While advocates point to this arrangement as a model of corporate citizenship, Varnedoe sees another benefit for Iowa's small towns: Rural communities continue to consolidate schools and school districts, leaving a host of facilities waiting to be repurposed.

Lee Container was able to reconfigure the school building relatively inexpensively.

"The reason we were able to put this together, in my opinion, was the fact that this school became available," Varnedoe said. "When all the stars aligned, it ended up just working really well."

'It's a dire situation for many of those families'

Not everyone in Iowa Falls agrees with the premise of a day care shortage.

"If we were all packed full every one of us and people had nowhere to go, then it might be an issue," said Renae Off, who runs Renae's Rockin Daycare in her Iowa Falls home.

While her business rarely has openings, she said some of the newer in-home providers do. She said parents can usually find day care by calling around.

"If they make one phone call to any of us, we’re usually pretty helpful," she said.

Still, many of those in-home providers, including Off, don't accept state reimbursement.

"So for those families, there's nowhere for them to go other than neighboring communities," said Brenda O'Halloran, community development specialist at Child Care Resource and Referral.

And it's those lower-income families who are most at risk of leaving the workforce because of the high cost of child care.

"It's a dire situation for many of those families who are living paycheck to paycheck," O'Halloran said.

Rene Leonard, who operates Exploration Acres in her home, said she gets at least one inquiry a week from parents searching for day care.

"I'm full, and I think most of them are," she said.

Her home is in Eldora, about 17 miles from Iowa Falls. Her clients drive as far as 20 miles each way to drop off and pick up their kids each day.

But Leonard has warned her families: She and her husband plan to move to New York to be closer to family. They'll open a day care there, but she wanted her customers to have plenty of time to search for a new provider.

That hasn't been easy.

One of her clients has three kids in her program. The mom hasn't been able to find any place with three openings.

"She said, 'You're going to have to kick me out on the last day,'" Leonard said.

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