The Dunedin Kindergarten Association has taken over the lease of the former Edwards Bay Kidsown Early Learning Centre and will run it under the name of Portobello Kindergarten.
The Kidsown centre was closed on July 5 when operator Delysia Jamieson told parents she could no longer afford to pay the teachers and run the centre, which had 14 children enrolled.
Mrs Jamieson blamed the Government's 20-hours free daycare for the centre's failure, as the subsidy system left a financial shortfall.
Teacher Paula Duffy told the Otago Daily Times she was owed for four weeks' pay.
Mrs Jamieson said the teachers would be paid, but this would take four to six weeks as she waited for the subsidy payment to come through.
Dunedin Kindergarten Association general manager Christine Gale said the centre would open on Monday. It would be licensed for up to 21 children and enrolments were being taken, she said.
The association was not for profit and daycare would cost $2.50 an hour after the four free hours a day paid by the Government.
Mrs Gale said her predecessor had dealt with the changeover ''maturely'' and there had never been a question over the quality of teaching at the centre.
However, she said the financial situation had worsened over time.
She would look to run the centre with one teacher to every 10 children, with opening hours of 8.30am-2.30pm.
