Active Economic Development Grants

Minnesota Child Care Cost-Sharing & Economic Grants

Minnesota offers Child Care Economic Development Grants (Active 2026) to support employer-led child care solutions. The new DCYF agency consolidates all child care oversight into one department.

2026
Program Year
Active
Program Status
45F
Federal Credit Available
All
Employers Eligible
⚖️ How the Cost Split Works
🏢
Employer Pays
~33%
of total tuition
🏛️
Minnesota Pays
~33%
state match
👨‍👩‍👧
Parent Pays
~33%
of total tuition
📊 The Minnesota Savings Stack

Stack available Minnesota programs with the Federal 45F Tax Credit for maximum employer savings.

Benefit LayerSmall Business (<$32M)Large Business
State Program BenefitVaries by programVaries by program
Federal 45F Credit (2026)50% Tax Credit40% Tax Credit
Net Employer CostSignificantly ReducedSignificantly Reduced
💰 Real-World Employer Savings
Cost ComponentWithout ProgramWith State + 45F Stack
Annual child care cost (per employee)$12,000$12,000
State Program Benefit$0Varies
Employee Share$0Reduced
Employer Share$12,000Reduced
Federal 45F Credit (50% of employer share)$0Significant savings
Net Employer Cost$12,000Significantly Lower
📋 All Available Programs
Federal 45F Tax Credit
Federal Tax Credit
Up to $600,000/year
All U.S. employers
Duo-Share Program
Employer-Employee Split
Flexible cost sharing
All employers — no state required
📍 Geographic Coverage
Major Cities Served
Minneapolis St. Paul Rochester Duluth Bloomington Brooklyn Park Plymouth St. Cloud Eagan Woodbury Maple Grove Eden Prairie Coon Rapids Burnsville Blaine Lakeville Minnetonka Apple Valley Edina St. Louis Park
County Coverage
All 87 Minnesota counties are eligible for the $13M DEED employer grants and the new DCYF agency programs. Contact MNCPD for enrollment.
Frequently Asked Questions
Currently, Minnesota's main incentive for employers is through the Child Care Economic Development Grant rather than a direct state tax credit. However, all Minnesota businesses qualify for the expanded Federal 45F Credit (up to $600k).
Launched fully in 2025/2026, the Minnesota Department of Children, Youth, and Families is the new one-stop shop for child care licensing, subsidies, and the Great Start compensation program.
Managed by DEED, these grants provide funding for direct subsidies or incentives to retain employees. The current $13 million round had applications due March 17, 2026.
Minnesota now has a permanent, noncompetitive program that issues monthly payments to providers to increase teacher wages. This Public contribution helps stabilize the market for Duo-Share models.
In 2026, First Children's Finance is the primary technical partner for Minnesota businesses. They help employers utilize the Facility Revitalization Grants and Economic Development Grants to design sustainable Duo-Share models.
Yes. A Minnesota business can apply for Economic Development Grants (up to $300k per project) and also claim the 50% Federal 45F credit on their contributions.
Since Minnesota's Public partner contributes through Economic Development Grants and Provider Wage Support, a Duo-Share is the perfect fit. The state's workforce stabilization payments help reach a near-zero net cost.
📋 Available Programs & Incentives
Minnesota DEED Employer Grants ($13M)
State Grant
Competitive grants for employer-sponsored child care
Eligibility: Minnesota employers in participating communities
Minnesota Child Care Assistance Program (CCAP)
State Subsidy
Sliding-scale co-pay based on income
Eligibility: Families at or below 67% SMI
Federal Section 45F Credit
Federal Tax Credit
Up to 50% of employer costs (max $600K/yr)
Eligibility: All U.S. employers with qualifying child care expenses
Minnesota DCYF Programs
State Program
Comprehensive early childhood programs
Eligibility: Minnesota families with children birth to age 5
Duo-Share (Employer + Employee)
Employer Benefit
Flexible split — employer covers 25–75%
Eligibility: Any Minnesota employer, no state program required
Frequently Asked Questions
The $13M Minnesota DEED (Department of Employment and Economic Development) employer grants provide competitive funding for Minnesota employers who want to create or expand child care benefits. Contact DEED for current grant availability.
Minnesota created the Department of Children, Youth, and Families (DCYF) in 2024 to consolidate early childhood programs, child care assistance, and family support services under one agency.
Yes — all Minnesota employers can claim the Federal Section 45F Credit regardless of state program participation. This covers up to 50% of employer child care contributions, up to $600,000 per year.
Minneapolis, St. Paul, Rochester, and Duluth have the highest employer participation rates. DEED grants are available statewide.
Minnesota does not have a formal Tri-Share program. However, DEED grants and DCYF programs create a strong foundation. We recommend a Duo-Share model — contact us for a free consultation.
Minnesota's Child Care Assistance Program (CCAP) serves families at or below 67% of the State Median Income (SMI). Contact DCYF for current income thresholds.
Contact the Minnesota Department of Employment and Economic Development at mn.gov/deed or your local workforce development board for grant application information.