Johnson County child care initiatives look to a future after pandemic aid runs out

IOWA CITY — In an effort to get more parents back in the workforce after the height of the COVID-19 pandemic passed, government officials and community partners across Johnson County began collaborating to increase access to child care.

The results of their efforts were a child care assistance incentive program, infant and toddler scholarships and a wage enhancement program for child care workers, which all launched in 2023. The programs, funded largely by federal pandemic relief funds, aimed to provide access for lower-income families and increase the number of child care spots available.

However, most of the programs have guaranteed funding only through June 30, 2026. County officials and other community partners now are looking for ways to financially sustain the projects and for other ways to increase child care access throughout Johnson County.

The child care solutions group, which already was meeting prior to the pandemic struck, now includes staff from Johnson County, Iowa City, North Liberty, the University of Iowa, the Iowa City Community School District, United Way of Johnson and Washington counties, 4Cs of Johnson County, Community Foundation of Johnson County and Better Together 2030.

The group created and helped to implement various child care solutions across the county using a mix of pandemic relief funds that were granted to Iowa City and the county. Each of the American Rescue Plan Act-funded initiatives required that participating child care providers must serve ages up to 5 and participate in the state’s optional quality rating scale, or maintain accreditation from the National Association for the Education of Young Children.

The programs require that each center accept up to 20 percent of its children using child care assistance, a state program supplemented with the local help. Additionally, no more than half those using child care assistance can be the center’s own staff.

Each center doesn’t need to have the full 20 percent of children enrolled through child care assistance if there are not enough applicants. But if they don’t, they have to prove their enrollment process still is equitable.

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Child care assistance incentive programs

Child care assistance is a state-run program that provides access to child care for low-income families and offers reimbursement for providers at a fixed rate across Iowa. However, at most providers in Johnson County, the program doesn’t cover typical tuition rates — meaning some providers take a loss when accepting child care assistance.

The Johnson County child care assistance program offers an additional up to $300 a month per child to qualifying child care providers to help make up the gap between what the state provides and their tuition rates. The maximum incentive was raised from $200 to $300 after the program launched to encourage more participation.

The budget for the program is $405,000 from July 1, 2023 to June 30, 2026. A little over $80,000 of that has been spent and the rest of it is set aside in contracts with providers.

Through March 31, the program has served 121 children and increased the number of centers accepting up to 20 percent of child care assistance by four.

Currently, the program has no guaranteed funding beyond June 30, 2026.

“We're trying to work with the state on looking at maybe regional reimbursement rates or some other type of reimbursement rate … because in some parts of Iowa, the state reimbursement covers the full cost of tuition, and that is absolutely not the case here,” said Laurie Nash, Johnson County youth and family services manager, a Board of Supervisors meeting last month.

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Infant and toddler scholarships

The infant and toddler scholarship program serves families between 160 to 250 percent of the federal poverty level by providing up to 80 percent of private pay tuition costs primarily for children up to age 3.

“This is primarily for infants who are toddlers, (whose families) are over income for child care assistance, so over that 160 percent of the federal poverty level. But still, families that are working and not able to access (child care),” Nash said.

Scholarships are awarded through an application process and require applicants to work at least 28 hours a week. The program has a budget of $750,000 through June 30, 2026, and about $450,000 of that has been spent. County staff report the program is continuing to receive applications as new children are born.

To date, the program has served 24 children, some for multiple years, and a total of 14 child care providers have participated in the scholarship program in Johnson County. The program does not have guaranteed funding past June 2026.

Wage enhancement program

The wage enhancement program increases the wage of eligible child care workers by $2 per hour, and is funded in part by federal pandemic aid granted by Iowa City and the county.

The program already is planning for a future after the pandemic aid runs out.

Greater Iowa City Inc., made up of business and public sector leaders, has hired a full-time employee to lead efforts on a campaign to provide continuous funding for the program through engaging local businesses and other community stakeholders.

Michael Chen, Greater Iowa City’s community program development manager, was hired in fall 2024. By the end of December, the campaign already had secured $66,000 in funding and another $104,000 in pledged funding from 14 businesses across the county including the University of Iowa, Hills Bank, GreenState Credit Union and small businesses.

“My job is to make sure that something like this is sustainable, and I'm able to build the value of what we're doing to the local businesses around here and have them also contribute to the fund so that we can keep this going,” Chen previously told The Gazette.

The funds are being collected through the Community Foundation of Johnson County and qualify for tax deductions.

To support the size of the current program in Johnson County, which includes 120 full-time teachers across 10 centers, the program will need about $500,000 annually.

Initial funding for the wage enhancement program came from $1.5 million in combined pandemic relief funds from Johnson County and Iowa City. Of the participating centers, six are in Iowa City and four are elsewhere in the county. That funding is set to run out before June 2026.

Participating centers had an hourly wage of between $11.56 and $15 before the $2 per hour was added. The program also pays for payroll taxes for the participating centers.

To date, there have been 214 child care providers who have participated in the program.

Child care center leadership participating in the program previously told The Gazette that the wage enhancement program has decreased staff turnover, improved morale, attracted more qualified candidates and limited the need for tuition increases.

Additionally, there is a study being conducted by the UI National Resource Center for Family-Centered Practice about retention rates and job satisfaction comparing child care providers participating in the wage enhancement program with those that are not. That study will be presented later this month to the Johnson County Board of Supervisors.

Comments: megan.woolard@thegazette.com

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