How North Dakota compares on childcare regulations

According to an index published earlier this year by the Archbridge Institute, North Dakota has the country’s 14th most burdensome childcare regulations. Among its neighbors, North Dakota outperformed Minnesota (10), but is more stringent than Montana (21) and South Dakota (32). This suggests that the Peace Garden State has room for improvement.

Figure 1: Child Care Regulations Index

Indeed, while licensed child care centers in South Dakota can have up to 5 infants per staff member, North Dakota centers are limited to 4, as is the case in Minnesota. North Dakota allows up to 10 infants per group (or classroom) — slightly higher than Minnesota’s limit of 8. But Montana and South Dakota allow up to 12 and 20 infants per group, respectively.

North Dakota rules are especially strict for toddlers.

While North Dakota centers are limited to 5 children per staff member for 2-year-olds, centers in Minnesota can have up to 7, and those in Montana can have up to 8. For 3-year-olds, North Dakota centers can have up to 7 children per staff member, compared to 10 in South Dakota and Minnesota, and 8 in Montana.

These differences have real consequences for North Dakota families.

According to data from Child Care Aware, while North Dakota is a relatively more affordable state nationwide, childcare costs still constitute a significant portion of family incomes. Moreover, North Dakota lags behind its sister state, South Dakota, in affordability.

In 2024, center-based infant care cost $12,300 in North Dakota, approximately 12 percent of the state’s median family income. Among the 50 states, North Dakota ranked as the ninth most affordable state, beating Montana and Minnesota. However, costs were 35 percent higher than in South Dakota.

Figure 2: Center-Based Infant Care as a Percent of Median Family Income, 2024

Among its three neighbors, Minnesota remains the least affordable and the most stringently regulated state. South Dakota is the most affordable and least restrictive state, indicating a strong link between regulatory stringency and childcare costs.

Indeed, a 2022 analysis by researchers at the Federal Reserve Bank of St. Louis found that “there is a negative relationship between childcare affordability and the average child-staff ratio in each state.” That is, states that allow a higher number of children per caregiver, meaning that operating costs are spread over more children, on average, see lower prices.

Published academic research confirms this finding and estimates that states could lower costs for center-based infant care by up to $1,890 by allowing an additional child per caregiver. Repealing rules that require a high school diploma for applicants could reduce costs by up to $4,350 per infant.

North Dakota has room to improve

Certainly, North Dakota families are not feeling the same financial squeeze as their counterparts in high-cost states, such as Minnesota. But the state has room to match more affordable states, like South Dakota. Stringent rules are the only obstacle standing in the way.