Bills targeting Montana’s child care challenges maintaining steam

With the 2025 legislative session shifting into its final weeks, early childhood care and education advocates throughout the state are closely watching a string of policy proposals still alive in the Montana Legislature to address ongoing challenges in the child care sector.

Workforce shortages have continued to drive much of the debate over those measures. According to a state health department report from 2023, employee turnover was the top contributor to open positions in the child care industry that year, and Montana Advocates for Children coordinator Grace Decker estimates that 1 in 3 child care workers leaves the profession annually. Low pay remains the most commonly cited reason for such departures, with the Montana Department of Labor and Industry reporting the average child care worker wage in 2022 at $12.73 an hour.

House Bill 456 emerged early on as an effort to address the financial strain for child care workers with children of their own by making them automatically eligible for state child care assistance. Sponsored by Rep. Jonathan Karlen, D-Missoula, the proposal is estimated to help cover tuition costs for as many as 400 children of child care workers who don’t currently qualify for Montana’s Best Beginnings scholarship, at a total cost of $5.4 million. HB 456 cleared the House with strong bipartisan support in early April and is slated for its first Senate committee hearing in the coming days.

Michelle Parks, executive director at the Missoula-based nonprofit Child Care Resources, told Montana Free Press in an interview that Karlen’s proposal would help to stabilize the state’s child care workforce. Her organization has long administered the Best Beginnings program for families in the Missoula area. But after a series of adjustments to contracted child care support services by the state health department last year, Child Care Resources is now in the process of building out a new coverage area that encompasses 26 Montana counties. 

Parks said that while HB 456 will further increase her organization’s workload in those counties, the end result will “help a lot of people,” particularly child care workers in dual-income households who are earning just enough to fall above eligibility. She added it will also alleviate financial issues for providers who are currently offering child care slots to their employees free of charge. 

“We’re hoping that a lot of providers that are comping their workforce right now will be able to fill those slots with scholarships and keep those workers,” Parks said.

Another proposal carried by Karlen, which sought to increase the income eligibility threshold for Best Beginnings scholarships for all families in the state, was voted down in the House in late March.

Several more bills that aim to make child care more affordable and accessible for an even broader swath of Montana parents have so far gained bipartisan steam in the Legislature. Senate Bill 321 — sponsored by Sen. Josh Kassmier, R-Fort Benton — would establish a three-pronged income tax credit for families, child care workers and businesses that offer direct child care assistance to their employees. Lawmakers cut the bill’s proposed per-child credit in half from an initial request of $1,200 down to $600, with actual amounts scaled down based on household income, but have to date preserved credit totals of $1,600 for eligible child care workers and $5,000 for qualifying businesses. Fiscal analysts project the total cost of the credits at $44 million. 

SB 321 passed the Senate in early April and is scheduled for a House committee hearing in the coming days. But it’s not the only measure still alive in the Legislature to establish a per-child tax credit. Rep. Mary Caferro, D-Helena, has so far successfully ushered a separate proposal — House Bill 220 — to create a $1,200 credit for children under the age of 5. The bill cleared the House this month with strong bipartisan support.

The discussion over significant state investments in child care continued April 14 as Sen. Laura Smith, D-Helena, rattled off a series of statistics before the House Human Services Committee while introducing one of the session’s most ambitious child care proposals. Citing a 2020 state labor report, Smith noted that 40% of Montana businesses reported difficulty hiring and retaining employees due to local child care shortages, and that 62% of parents reported missing work for similar reasons.

“I won’t belabor the point, but child care is a top issue for Montana’s working families,” Smith said. “I heard about it on the doors [while campaigning], and we’ve heard it frequently throughout the session.”

To address the issue, Smith proposed a “historic investment” in the state’s child care system of $150 million, a one-time appropriation to establish an endowment fund as seed money for state grants supporting workforce development, technical assistance, quality and affordability initiatives and emergency assistance for Montana’s child care sector. Senate Bill 565 passed the Senate on April 5 just ahead of its transmittal deadline, garnering support from a mix of Democrats and Republicans on a 26-20 vote. During this week’s committee hearing in the House, child care providers and advocates including Decker spoke to the bill’s potential long-term contribution to stabilizing the personal, professional and financial lives of Montana families, a point echoed in supporting testimony from the Montana Chamber of Commerce. The hearing had no opponent testimony.

Proponents note the broad range of prospective grant opportunities offered under SB 565’s trust fund — which would be overseen by a seven-member board appointed by the governor — would support enhancements not only in the child care system but in Montana’s broader structure of early childhood services.

“We recognize child care is a big part of the early childhood system, but there are other services and supports that families access day-in day-out that are also really critical,” Caitlin Jensen, executive director of the nonprofit Zero to Five Montana, told MTFP in a recent interview. “That includes early intervention, before- and after-school care, home visiting, early learning, early literacy. [SB 321] really helps to put everything in a larger framework and identifies different ways that this fund could help to support critical infrastructure for the child care and early childhood system in Montana.”

The fate of Smith’s bill will likely be intertwined with a complex trust bill being advanced by House Appropriations Chair Llew Jones, R-Conrad, which would bundle it and several other bills into a single trust that would invest a portion of the state’s current budget surplus and route interest revenues to a list of programs including child care efforts.

That combined trust measure, House Bill 924, would seed its Montana Growth and Opportunity Trust with hundreds of millions of dollars and deposit further money in high-revenue years going forward, eventually building an endowment that directs as much as $15 million a year toward the sort of child care support envisioned by SB 321. The combined trust proposal would also support pensions and affordable housing loans and route funding to property tax assistance, local bridge maintenance, water projects and efforts to prepare for natural disasters.

HB 924 passed the House with mixed support within both the chamber’s Democratic and Republican caucuses and is currently under consideration by the Senate Finance and Claims Committee.

Some Republican lawmakers have balked at the price tags associated with child care policies. During the Senate’s April 3 floor debate on SB 321, Sen. Greg Hertz, R-Polson, cautioned fellow legislators they were at a point in the session where they needed to start “watching the money.” Hertz lamented the size of the bill’s fiscal note even after the significant reduction to Kassmier’s proposed per-child tax credit — a reduction Sen. Daniel Emrich, R-Great Falls, later maligned as prioritizing child care workers over Montana parents.

“We don’t have a huge shortage of child care workers, so this makes no sense,” Emrich argued. “There’s no recognition of parents in here. I mean, $600? This is ridiculous. We’re going to just brush over all the moms in this state in favor of child care workers who are already earning a living wage?”

The analysis of the state’s child care shortage by the Montana Department of Labor and Industry last year estimated that licensed child care capacity statewide met less than half of the demand for services, and reported the median annual wage for child care workers at $26,720. In a Montana Free Press-Eagleton Poll conducted early this year, 71% of Montanans surveyed said they were concerned about the cost of child care, and roughly 64% indicated concern about the availability of child care in their community.

Decker told MTFP that lawmakers debating these policies have routinely acknowledged child care as a priority in the 2025 Legislature, a development she added is “encouraging” to advocates who have been working for years to raise awareness and spur action. That encouragement manifested early on this year, she continued, as legislators lamenting the session’s slow starting pace repeatedly listed child care as one of the issues constituents had elected them to address.

“That continues to be really encouraging,” Decker said, “because even as we get down to the wire, child care is still on the agenda and still appears to be a priority because there are still efforts in motion to do something.”