Grants could add 2,400 openings at child care centers

Money from the federal government could soon help add about 2,400 openings for kids at new and expanding child care centers in South Dakota.

The money comes from the $1.9 trillion American Rescue Plan Act, which Congress passed and President Joe Biden signed into law in 2021. The legislation was a response to the economic and health effects of the COVID-19 pandemic.

The state Department of Social Services is making $17 million of remaining funding from the law available as startup and expansion grants for child care providers.

“I’m pleased to tell you that we’ve had a very strong response,” said Matt Althoff, secretary of the department. He gave an update Wednesday to the Legislature’s Interim Appropriations Committee at the Capitol in Pierre.

How South Dakotans are making child care affordable and available

The application period opened in February. Through the end of April, the department had received 63 qualified applications. They account for $13 million in requests and would create 2,400 additional openings for children in 37 communities.

Althoff said the department is not yet ready to announce grant awards but will be soon. The department’s deputy secretary, Brenda Tidball-Zeltinger, said the applications are from a range of small and large care settings in communities across the state. She referenced applications from Sioux Falls, Rapid City, Aberdeen, Baltic and Porcupine as examples of diversity in community sizes and locations.

“It was a good mix,” she said.

New and expanding providers can use the money for health and safety items needed to meet licensure requirements, equipment and supplies necessary to open or expand, payroll and benefits, and other operating expenses such as rent and utilities.

The $17 million grant program is part of a broader, $38 million pot of remaining money from the American Rescue Plan Act that the department is using to bolster child care in the state.

Here’s how the department is splitting up the rest of the money:

• $13 million to upgrade outdated technology used to manage child care licensing, and to modernize the technology that handles billings and payments for child care subsidies.
• $4 million to hire a contractor who will conduct a study of the child care workforce in the state, and to pilot the placement of digital fingerprint scanners at child care centers to streamline required background checks for workers.
• $2 million for an effort at South Dakota State University to develop a framework for rating the quality of child care providers.
• $2 million for a marketing campaign to recruit workers into the child care industry.