Commentary, COVID-19, NC Budget and Tax Center

NC early childcare system is left behind by inadequate COVID relief

As North Carolina parents juggle working, supervising remote learning and providing child care for their youngest kidssurvey data from August shows that our state’s childcare infrastructure needs more support. 

Early childhood educators have provided crucial supports for essential workers during the COVID-19 pandemic. As more people return to work, we’ll need a strong childcare system for a successful economic recovery.  

While many programs are re-opening, those that are currently operating reported serving about 30% fewer children than before the pandemic. Persistent low enrollment threatens the long-term viability of our childcare system. 

Family childcare homes are now serving about 85% of the children who were attending before the pandemic, and enrollment has been fairly steady since May. Childcare centers had steep declines in enrollment, but attendance in open centers has increased since May and now stands at 59%  

 

Early childhood educators depend on parent fees to cover the costs of running a program, which in turn enables them to earn a living and support their own families. This is why declines in enrollment are such a problem. 

For family childcare homes, even relatively small declines in enrollment make it hard to stay open, as they tend to run on razor-thin margins. Even before the pandemic, early childhood educators made less than $11 per hour on average in North Carolina, frequently with no benefits. Low wages make it challenging for program directors to retain staff, an issue that is heightened by the pandemic.  

At a virtual town hall hosted in August by the North Carolina chapter of the National Domestic Workers Alliance and Moms Rising, early childhood educators spoke passionately about their commitment to the youngest North Carolinians and their struggles to stay afloat during COVID-19. 

In the words of Darlene Brannon, a childcare center director with 15 years of experience:  

It was a real honor to come into this field  [but] we’re are not getting paid to do all that we’re doing. A lot of our parents have not been able to come back to the childcare center, because they’re not working yet  Even the parents that are still coming, that are essential workers  they’re not making enough money to pay the parent fee as well as pay for food for their children. 

Darlene’s experience shines a light on the need to build a childcare system that works for parents and educators. Instead, chronic underinvestment coupled with a lack of meaningful COVID response creates false choices between directing assistance to parents of young children or to educators.  

HB 1105, the Coronavirus Relief Act 3.0 passed by the NC General Assembly on Sept. 4, didn’t go nearly far enough to sustain and strengthen our childcare system. The bill provided $35 million for operating grants to early childcare programs, and while this funding is desperately needed, it is a one-time investment unlikely to cover more than one to two months of bonus and retention payments.  

The bill offers $8 million in additional childcare assistance payments for parents, but this is far below what is needed. The money would serve only about 1,300 kids for one year, leaving too many behind.

According to the NC Early Education Coalition, at least 14,000 eligible families are on the waitlist for childcare support The NC Division of Child Development and Early Education had been covering co-pays for parents receiving childcare subsidies during the pandemic, but without any additional funds, that support has now ended.  

In addition, the funding is is limited to support for remote learning opportunities, which creates unnecessary hurdles for families seeking assistance. 

Instead of providing more support to low-income families, HB 1105 allocated $440 million to the poorly designed Extra Credit Grant Program, providing one-time direct cash payments of up to just $335 to North Carolina parents.

These grants are not targeted to the parents who need them most. Because the grants will rely primarily on tax filings to distribute paymentsthey may even exclude many of the state’s lowest-income families who do not earn enough to file taxes but who do contribute through sales and other taxes. 

Furthermore, our current childcare subsidy system does not cover the actual cost of providing quality care. Our state needs to adjust reimbursement rates for the programs that provide care to families receiving subsidies in order to ensure they are adequate, equitable, and offer early childcare educators a living wage. 

North Carolina needs long-term public investment in early childcare. It is necessary to support our recovery from COVID-19, to ensure that programs are open as parents return to work, and to continue for a stronger state.

Childcare providers see the value of their work every day, and comprehensive public funding would show that North Carolina recognizes their value as well, and the value of the children in their care and the families that rely on them. As Stephanie Shell, a family childcare home provider, said at last month’s town hall: 

I ask that our legislators think aboutthe studies that show the first five years of a child’s life are the most critical of their development, and that we are the people helping with those first five years. We would like to see that reflected in theirdecisionmaking in terms of funding and support for us through this crisis.

 

Logan Harris is a Senior Policy Analyst with the Budget & Tax Center, a project of the NC Justice Center.

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