A Leelanau County Startup Sets The Stage For Statewide Childcare Innovations

A groundbreaking effort is now underway in Leelanau County to create innovative, sustainable infant and toddler childcare for its working families. If the plan succeeds, it could mean reviving two now-dormant childcare facilities — with a twist! — and put Leelanau County at the epicenter of changing state regulations for childcare licensing.

Right now, the Michigan Department of Licensing and Regulatory Affairs (LARA) is considering a first-ever variance to the state’s current center-based childcare regulation in Leelanau County, shares Emily Laidlaw, director of LARA’s Child Care Licensing Bureau. Michigan law prohibits a family or group home childcare from operating outside of a personal residence, but this variance would allow individual childcare providers to legally operate a “home-based” childcare business at an approved site that is not their own home. Laidlaw explains, “We are working to think beyond the traditional division between childcare centers and family childcare homes to license, incubate, and promote systems of small group care in nonresidential locations.”

But why? Forty-four percent of Michigan families live in a childcare desert, says Laidlaw, due to “large upfront and ongoing staffing costs that limit the number and diversity of entrepreneurs who are willing to take the risk of starting a new childcare business.” And to fix that, she shares, “allowing for innovative locations and right-sizing administrative staff for extremely small businesses — sometimes called micro-businesses — have been the most impactful variance to regulation that we have considered.” 

What set this in motion in Leelanau County, Laidlaw says, was the innovation already in progress here with the new Infant & Toddler Childcare Startup (ITCS). 

The ITCS was born, says its co-chair Patricia Soutas-Little, out of grave concern over “drastically diminishing childcare options in the last few years” for “infants to early 3s” specifically. Seeded by a $318,000 grant from Lansing-based Early Childhood Investment Corporation (ECIC), the ITCS team of professionals and volunteers is able to provide eligible Leelanau County residents startup expenses required to establish their own quality home-based childcare business — covering anything from renovations, fingerprinting, business supplies, cribs or toys — plus personal coaching to help them navigate the startup.

ITCS is actively recruiting potential home-based care providers in the county. Soutas-Little explains that in-home care by an individual was the logical path forward to “make childcare more affordable for families and to provide a living wage for the provider themselves.” Standalone centers can be prohibitively costly to operate, let alone to staff to meet administrative needs and required ratios of staff-to-children, namely for those under the age of three.  

Casey Petz, superintendent of Suttons Bay Public Schools (SBPS) and director of its Early Childhood Program concurs, sharing that while SBPS has a classroom in its Lil' Norsemen Center licensed for care for ages 0 to 3, it does not offer care to this age group. “What we have found is that the LARA regulations and financial obligations on school employees currently in place for center-based providers make it exorbitantly expensive for the operator [in this case, SBPS] and for the families that would pay tuition to enroll in care with us,” he explains. “Simply put, there is no way to provide the high-quality care that children aged 0 to 3 require and also make that care affordable to families.”

But even with startup funding for home-based providers and business support in the wings, Soutas-Little says they keep hitting an unexpected snag in recruiting potential candidates: people not wanting to start the business in their own home.

She explains “one of the objectives of our grant is to expand hours of operation to include after hours and weekends when working families need childcare. But most people don’t want to provide childcare in their home after hours as their own families are home.” Others interested in providing childcare “feel their home is inadequate…other family members are home working, or renovating the space within their home to meet LARA regs is too expensive.” Others simply want to go to work in a different environment.

“We lose potentially good candidates for these and other reasons,” she says.

While “shining a flashlight from different sources” to find a workable solution, Soutas-Little says they had a serendipitous conversation with ECIC’s Child Care Innovation Fund director, Joan Blough, who “opened the door to the [LARA] Child Care Licensing Bureau.”

They’ve now entered a cooperative commitment with Laidlaw and her team to get the variance to operate a home-based program outside the home in place. What’s even better, says Soutas-Little, there are currently two unused childcare facilities in the county and excellent candidates to operate their home-based business from them.

One is — you guessed it — the 0-3 classroom in the Lil' Norsemen Center.

Petz tells the Leelanau Ticker once SBPS hears from LARA on the expected changes to current regulations, the school board would take action on approving a “use agreement” with a home-based provider. This partnership, he says, “allows us to solve some of the issues they face —proper facilities for this sort of care — while taking advantage of the lower cost/overhead model of the ‘home-based’ care business model.”

The other is the shuttered Leelanau Children’s Center in the village of Northport. The village owns the daycare facility property, and Northport Public School and the village have informally, but seriously, discussed the school being the landlord for this purpose. “The village has told me that a letter of intent is coming this week,” shares Superintendent Neil Wetherbee. He’ll next seek a Leelanau Township Community Foundation grant that could fund maintenance/operation costs for the building itself.

He says the school is willing to act as landlord because, “The center closing, particularly the way it closed, caused a lot of frustration and scrambling for Northport families. There weren’t any immediate ripple effects for the school, but the health of the school mirrors the health of the community. A community with vibrant childcare is healthier than one that has none…and families need to think twice about moving to a community with no childcare before kindergarten.”

LARA staff has been to the county for a pre-licensing site visit to each facility.

Soutas-Little says of the variance, “We are the only ones in the state being granted this on an innovation project trial balloon and this concept will be addressed in legislation yet this year if we are successful. Since we will be the first ‘test case’ and the basis for proposed change in childcare legislation, this potentially impacts other early childhood programs across our state and beyond.”  

Indeed, says Leelanau’s state representative Jack O’Malley, a champion of childcare with his own package of childcare bills now sitting with the senate committee, “This variance is a big deal. We need to allow childcare wherever it makes sense. Currently the law says in home care can only happen in a home, [but] the law is focusing more on the location than the style of care. If all the rules of a family day care are followed...why not allow it to be in a suitable building?”

He adds, “Once this variance is determined I will be introducing legislation to alter the law to reflect this logical change.”

Blough notes that Leelanau is a trailblazer in seeking equitable solutions for childcare, and that “a rural community experiences problems differently. This is a supply-building project so we can understand from the ground up how you build childcare supply when you have different resources to rely on. Something I have seen in Leelanau? Fewer formal resources but stronger community connections and the ability to build on community connections.”

She says she hopes that this collaboration sparks “more people across Leelanau County to see how they can be a part of a childcare solution, not only for the short term — for example, helping my employee go to work — but also for long-term economic stability.”

Petz levels with the Leelanau Ticker: “Quite frankly, this innovative approach is the only sustainable way that we can see affordable, accessible, high-quality care being available in our area.”

Equally crucial will be “keeping the business financially viable for new providers and working with those communities to embrace and support the provider,” says Soutas-Little.

“This was not in our original business plan but finding solutions is a key part of the story,” she says, adding “Who knew little Leelanau County would end up being the impetus for changing state regulations regarding childcare?”