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U.S. Sen. Tina Smith (D-Minn.) was in Luverne Tuesday morning to see the building that will be transformed into a day care center with help from $2.6 million in federal funds.
She met with city leaders about their plans to expand access to affordable child care by remodeling a 30,000-square-foot facility into a new child care center in the city.
“If there’s one thing I’ve learned about Luverne, it’s that you all are very entrepreneurial and figure-it-out kind of folks,” Smith said.
“There are child care projects all over the state. Every community is figuring out how to do it in its own way, but I think this is a real model for how to go about it, because it’s a public-private partnership.”
Mayor Pat Baustian explained that the city subsidizes the pool and fitness center as an amenity for residents, but the day care center isn’t an amenity; it’s a necessity that needs public subsidies until it can succeed on its own.
Once construction is complete, the city will turn over the facility to a non-profit for $1 per year, and the city will continue to subsidize its operation, maintenance, snow removal, lawn care and utilities.
Smith asked how the idea came about to do it that way.
Luverne Economic Development Authority Director Holly Sammons told Smith that after years of studying the issue and consulting experts, it became apparent that it would take a public-private effort.
“We realized we had to offer a building at a low rate for someone to operate a day care center,” Sammons said.
“No entrepreneur can buy a building — or acquire a building and remodel it — and afford the debt service. That model doesn’t work.”
The center will provide 186 new spots for working families. It will have capacity for 24 infants, 42 toddlers, 60 preschoolers and 60 school-age children.
Sammons said the community will always need in-home child care providers, but there are currently not enough of them to meet demand.
Current studies point to a day care shortage of more than 120 slots in Rock County, which makes it difficult for employers to find adequate labor when working parents must live and work elsewhere to find child care.
That shortage doesn’t account for the two major employers adding new jobs in Luverne’s industrial park this summer. Lineage Logistics cold storage warehouse and Premium Minnesota Pork’s new smoke house will each need roughly 80 employees, and many of those workers will need child care.
In order to support local business hiring, the city of Luverne purchased the former Tri-State Insurance building (most recently Total Card Inc.) for $515,000 and announced that it would subsidize a day care operation.
City Council member Dan Nath pointed out that the day care center will benefit the entire county.
“We’re going to have the ability to draw from other communities,” he said. “We have people who are driving 30 miles to bring their kids to day care and then drive 30 miles back to work. We’re really hoping we can become that hub.”
Mayor Baustian said day care will be another reason for working families to live in Luverne.
“We have our strong education system, health care, housing stock … the day care is that final piece,” he said.
The city purchased the building in March 2022 after more than six years of feasibility studies showed that rural family wages can’t support salaries of qualified child care center professionals.
In order for a day care business to succeed, it would need public support.
The recent federal funding was awarded through a process called “Congressionally Directed Spending,” which Sen. Smith was actively involved in securing after close coordination with local leaders.
The funds will help support the estimated $6.4 million renovation, construction, and furnishing of Luverne’s child care facility.
Construction is expected to begin this summer with a projected opening late in 2024 or early 2025.
Sen. Smith serves on the Senate Education Committee and recently joined over three dozen lawmakers to introduce new legislation called the Child Care for Every Community Act.
The bill would expand access to affordable child care to people across Minnesota and the country, offer high-quality education to children, and create jobs for early childhood educators.