DHS is moving in the right direction, but daycare licensing rules still need further reform

It takes at least 18 months of combined education and work experience for a high school graduate to become a daycare teacher in Minnesota. Across the border in Wisconsin, it takes just seven months.

As a result, daycare centers in Wisconsin find it much easier to hire teachers than those in Minnesota. Additionally, due to these strict rules, Minnesota is among the most expensive states for daycare in the country.

Under an ongoing Childcare Regulation Modernization Project, the Department of Human Services (DHS) has proposed relaxing Minnesota’s stringent hiring requirements. But while commendable, DHS’s proposals do not go far enough. Moreover, for Center Directors, DHS is tightening, not loosening, hiring requirements, which would likely hurt the childcare industry, negating other suggested positive changes.

American Experiment is urging further reform as the Childcare Regulation Modernization Project continues.

What is the Childcare Regulation Modernization project?

Legislators signed the Childcare Regulation Modernization Project into law in 2021. Among other things, the project tasked the DHS with analyzing current statutes to propose updates to Minnesota’s childcare licensing standards.

After contracting with the National Association of Regulatory Administration (NARA), DHS released the first draft of updated standards in April last year. American Experiment noted at the time that the new standards were a step in the right direction. However, more reform was necessary.

This year, DHS released a second draft and is currently seeking public feedback until July 11. After the public comment period is over, DHS will create a third (and final) draft, which will be sent to the legislature. Lawmakers could adopt the proposed standards into law in the 2026 legislative session.

Some welcome changes, but deeper reform is necessary

The second draft maintains much-needed reforms from the first draft that ease rigid hiring requirements.

The good

For instance, under the proposed new standards,

• The list of acceptable topics for post-secondary education has been expanded. This would also likely widen the pool of available applicants.
• Centers can accept applicants who have work experience outside of daycare centers. This includes work experience in family childcare, tribally licensed childcare programs, public schools, and license-exempt childcare centers.
• The required education and work experience for teachers or assistant teachers have been reduced. The following table is a look at current vs. DHS’s new teacher hiring requirements under a few (of the several) options available to applicants.

	Current requirements	DHS proposal
Route 1	16 semester post-secondary credits, plus 4,160 hours of experience as an assistant teacher.	12 semester post-secondary credits, plus 4,160 hours of experience.
Route 2	A Child Development Associate (CDA) credential, plus 1,560 hours of experience as an assistant teacher, aide, or intern.	a Child Development Associate (CDA) credential, plus 1,080 hours of experience.
Route 3	Bachelor’s degree from an accredited college or University in any field, plus 1,080 hours of experience as an assistant teacher, aide, or intern.	Bachelor’s degree from an accredited post-secondary institution, plus 520 hours of experience.

• To qualify as experienced aides — who can care for children without direct supervision — applicants need 2,080 hours of work experience, down from 4,160 hours. This would likely abate worker shortages.
• Family childcare providers could transition to teaching at licensed daycare centers, provided they meet certain requirements.
• All childcare staff will undergo a standardized orientation program, yet to be developed by DHS, called Child Care Basics training.

Room for improvement

In a 2022 report, American Experiment highlighted that Minnesota ranks among the states with the most burdensome regulations for licensed daycare centers—a finding confirmed by other research, including a recent report from the Knee Regulatory Research Center at West Virginia University. Proposals loosening hiring requirements for teachers and assistant teachers are, therefore, a step in the right direction.

However, there’s still room for DHS to ease the regulatory strain on daycare centers. That’s why American Experiment is calling on DHS to go further in its third draft and consider the following key changes.

Hiring requirements

DHS should

• Further relax hiring requirements for teachers and assistant teachers. In Wisconsin, for example, teachers need only 240 hours of work experience and 4 credits of post-secondary education in early childhood education. Given that Minnesota already requires training in early childhood education under certain pathways, such as CDAs, hours of experience could be reduced further without jeopardizing childcare.
• Relax, not tighten, hiring requirements for center directors. It takes 90 hours or 6 semester credits of education, plus 1,040 hours of work experience, to qualify as a director in Minnesota. Raising the required education hours to 120, as DHS proposes, would lengthen training time and likely worsen worker shortages for daycare centers.
• Loosen the 20-year age requirement for experienced aides. To qualify as an experienced aide, an applicant must be 20 years old and have a year of childcare work experience. However, inexperienced aides start working with children at 16. This means that they already have a year’s worth of work experience at 17, but would have to wait three more years to become experienced aides. On the other hand, someone who starts out working as an aide at 16 can obtain the necessary credentials and become an assistant teacher likely before they turn 20.
• Reduce in-service training hours for staff working more than 20 hours a week. Currently, Minnesota requires 24 hours of ongoing training each year for center staff working over 20 hours a week, compared to 12 hours for those working less than 20 hours. This arbitrary distinction for people who do similar jobs adds an unnecessary burden to full-time staff workers.
• Allow staff to use the proposed Child Care Basics training to meet some of the education requirements.

Staff-to-Child ratios, group size limits, and staff distribution

DHS should:

• Loosen staff-to-child ratios for infants. Several states allow between 5 and 6 infants per staff member. Minnesota allows only 4 infants per staff member.
• Reduce the upper age cap for infants to 12 months. Current statutes define infants as children between 6 weeks and 16 months. Infants are subject to the strictest staff-to-child ratio of 1:4. Lowering the cutoff age for infants to 12 months would reclassify children aged 12 to 16 months as toddlers, who fall under a more lenient 1:7 ratio, likely reducing costs and saving parents money. Alternatively, DHS could create a new category for children between 12 and 24 months with a staff-to-child ratio that falls between those for infants and toddlers.
• Loosen staff-to-child ratios and group size limits for older children. In numerous states, including North Dakota, Wisconsin, and Illinois, centers can have between 18 and 20 children per staff member for kids over 5. The Minnesota staff-to-child ratio for kids in that age group is 1:15. Allowing more kids per staff and group would likely reduce costs per child and save parents money.

Slashing red tape is key to improving affordability

According to 2023 data from Childcare Aware, parents spent 24 percent of the state’s median household income on infant center-based care, making Minnesota the fourth least affordable state in the country. Minnesota also ranked fourth least affordable for 4-year-olds.

Figure 1: Average annual cost of infant center-based care as a percent of median household income, 2023

Stringent licensing rules significantly contribute to making daycare unaffordable in Minnesota compared to other states. To tackle these high costs, the legislature must confront and reform these overly burdensome regulations. The ongoing modernization project presents a rare opportunity to implement these much-needed changes.