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Advocates warn childcare industry headed for collapse 

Advocates warn childcare industry headed for collapse 

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With roughly half of childcare providers still closed from the coronavirus pandemic and advocates warning the industry is headed for financial collapse, members of the state's Congressional delegation are backing a $50 billion bailout that would help providers stay afloat. 

The U.S. House voted last week to pass the Child Care is Essential Act, introduced by Congresswoman Rosa DeLauro, D-Conn., which would create a $50 billion “Child Care Stabilization Fund” through which providers could receive grants to cover operating costs, pay staff, and comply with virus mitigation guidelines.

The legislation would also provide some tuition and copayment relief for working families. Republican lawmakers unveiled a stimulus package last month that would provide a total of $15 billion to industry.  

“This is a crisis,” DeLauro said during her testimony on the House floor. “More than half of child care programs could close if we do not act quickly. And if we cannot make families feel that their kids are going to be safe and secure in their child care setting, we are not going to get our economy on track.” 

DeLauro’s district includes Wallingford and North Haven. 

The bill, which now heads to the Republican-controlled Senate, passed 249-163, with 18 Republicans and all Democrats voting in favor.

Republicans proposed a stimulus package last month that would provide $15 billion to the child care industry.

The political news website The Hill reported last week that while Republicans said they agreed access to child care is important, they criticized the bill as partisan.

“This is no more than a copy-paste of various Democratic child-care proposals, superficially edited to link to the pandemic,” Rep. Tom Reed, R-New York, told the website. 


The pandemic led droves of providers throughout the country and state to close, with an April survey by the Bipartisan Policy Center showing 60 percent of licensed providers nationally closed and stopped serving children entirely. In some cases, centers were forced to close because they couldn’t survive financially, while other centers voluntarily closed due to concerns about the virus.  

Unlike many other states, Connecticut allowed daycare providers to remain open during the pandemic, but with enhanced safety precautions. Many centers that closed and are now reopening say they’ve been squeezed by lower enrollment numbers and, in some cases, are having difficulty bringing staff back. 

Roughly 50 percent of child care providers in Connecticut are currently open, according to the state Office of Early Childhood, a significant improvement from a month or so ago, when around 16 percent of providers were open. 

“In good times, these are small businesses that operate on razor-thin margins,” DeLauro said. “And now, with the pandemic, they are facing financial ruin.”

Approximately 40 percent of providers say they are certain they will close permanently without any government intervention, according to a recent survey of more than 5,000 providers by the National Association for the Education of Young Children. 

Beth Bye, commissioner of the Connecticut Office of Early Childhood, previously estimated that Connecticut could lose 45,000 childcare spaces without government intervention, citing projections from the Center for American Progress.

“Those numbers are chilling,” U.S. Sen. Richard Blumenthal, D-Conn., said during a recent “Child Care in Crisis” press conference. “To think that 45,000 spaces may be lost in Connecticut alone, that 40 percent of our child care facilities around the country in the next few months may close is just a national disgrace and shameful.”

“In good times, these are small businesses that operate on razor-thin margins. And now, with the pandemic, they are facing financial ruin."

-U.S. Rep. Rosa DeLauro

Carly Adames is the executive director of Children’s Day School in Greenwich, a nonprofit that serves 200 children and families in the Greenwich and Stamford area. The school, which relies on tuition fees, has lost $670,000 in revenue since the pandemic began, DeLauro said during a recent virtual video conference call with DeLauro and other providers. 

“I don’t know where we go from here. In order for us to maintain a viable program and a break-even budget, we need to maintain 95 percent enrollment of our capacity,” Adames said. “With limited group size restrictions and reduced enrollment, continuing down this road is undeniably unsustainable.”

Adames also pointed out that early childhood educators don’t have the same security blanket as K-12 teachers. 

“The driving force for K-12 teachers in determining whether or not to return to in-person instruction is health and safety, that’s it,” she said.  “Whenever in-person instruction resumes, the school will be there, the funding will be there, and operations will resume. On the contrary, many early childhood providers are being partially motivated by financial stability … We don’t have the luxury of knowing that whenever we return operations will resume.” 

 In some cases, families financially hit by the pandemic can no longer afford child care. Other families worry whether it’s safe to send their child back or have opted to take care of their child while working from home. The NAEYC survey found 86 percent of respondents are serving fewer children now than they were before the pandemic, with enrollment down 67 percent on average. 

John Benigni, CEO of the Meriden-Berlin-New Britain YMCA, said none of the Y’s nine child care centers in Meriden or five in Berlin and New Britain have had to shut down. But nonetheless, the Y has seen tighter financial margins due to state-mandated restrictions on the number of children per classroom. The limit started at 10 but was raised to 14 about a month ago. 

“The business of childcare is definitely more challenging than ever before,” Benigni said. “... At one point we had 20 kids per classroom, now we’re down to 14. But our staffing levels remain the same.”

The decline in revenue is also compounded by increased costs for cleaning supplies, personal protective equipment, and necessary facility changes. A total of 91 percent of respondents on the NAEYC survey indicated they are incurring additional costs for cleaning supplies, while 76 percent are spending for personal protective equipment. 

Prior to the pandemic, the state was already losing daycare slots because so many providers operated on tight budgets, according to Bye. 

"So before this (pandemic), we were losing programs. Now we're saying to programs that were barely making it, you can take half as many kids," Bye said during a video news conference in May. "The usual demand is down and we've cut their supply in half. There's no way they can make it. So this is why the federal funds are critical." 

The proposed $50 billion bailout bill would allot $330 million to Connecticut, which experts say represents about six months of revenue for the industry. 

Katie Wojtunik, coordinator at the Meriden YMCA Infant and Toddler Learning Center, cleans toys at the center. Toys and rooms are wiped clean throughout the day. | Aaron Flaum, Record-Journal

Chris Lyddy, chief operating officer for the state Office of Early Childhood, said the funding would not only help the child care system survive the pandemic  but help “set a stage for looking down the road and being able to envision an industry that is much more stable than it is currently is.” 

“This is an industry that’s been underfunded forever,” Lyddy said. “This has already been a very fragile industry to begin with, an industry that is predominantly balanced on the backs of black and brown women.”

Blumenthal argues stabilizing the child care industry will be essential to economic restoration. 

“Even if you care nothing for children … think about the economic impact. We cannot reopen our economy, we cannot return, we cannot return to full employment … unless we provide more child care,” Blumenthal said. 

‘Slim pickings’

Benigni said the Y’s daycares were operating at full capacity a month ago until the state increased group size limits from 10 to 14. The Y is now in the process of filling those additional slots, and Benigni is worried the number of slots won’t be enough to meet the demand.

“I would imagine in the next month or so we’ll be filled to (capacity). If they don’t raise (class sizes up from 14), I’ll be forced to turn people away,” Benigni said. “The demand is definitely growing, and as the economy opens up and more people have to go back to work, if the amount of child care slots isn’t increased, it’s going to be slim pickings and difficult to get your children in.” 

Benigni said he knows of parents that are paying for child care they’re not currently using to ensure they have a slot when they return to work.  Even before the pandemic, finding affordable, high-quality providers was a struggle for many families.

“It’s becoming more and more competitive for those additional child care spaces for people that maybe were at a childcare center previously that shut down or is no longer taking anyone else,” he said. The Y, he added, has recently seen an influx of families they’ve never served before who are “taking the place of people we have served for a long time.”  

“It’s creating a situation where I don’t know if I’m going to have a slot for (long-time families) later on,” he said. 

Associated Press reports were used in this story 


Twitter: @MatthewZabierek

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