Like child care centers nationwide, St. Stephens Loving Daycare Center in Rocky Mount used the tens of thousands of dollars of federal COVID-19 relief funding it received during the pandemic for far more than cleaning supplies and face masks.
Director Carolyn Slade said first she used the quarterly relief checks to cover the tuition of families who struggled to pay during the pandemic. Then she put the funding toward playground upgrades, necessary building renovations, and pay raises for staff.
鈥淚 was able to give my staff a raise all the way across the board,鈥� Slade said. 鈥淎nd we were able to retain all 28 of our employees.鈥�
Many North Carolina child care centers used the federally-funded 鈥渟tabilization grants鈥� to raise pay to retain staff in a tight labor market. The state鈥檚 Division of Child Development and Early Education encouraged child care providers to use the funds to raise pay for teachers.
Slade gave her employees a $2 an hour raise over their pre-pandemic pay.
鈥淲hat we told them was as long as we have funding from the stabilization program, we would be able to keep them at that rate,鈥� Slade said.
Now that the federal relief ended in June, Slade dreads having to cut her employees鈥� pay and worries about the long term effects.
鈥淲e've been able to stay open, thank God, and not close like some facilities that had to close their doors 鈥� but we've been able to stay open because of the funding,鈥� Slade said.
The child care funding cliff is here, but it may be more of a 鈥渟lope鈥�
Advocates for early childhood education have long warned of a looming funding cliff as federal COVID-19 relief to the child care industry expired in June. Without any aid, experts predicted up to a third of North Carolina childcare providers could close, based on a .
Child care providers and advocates hoped state lawmakers would make up for the lost funds in their next budget to help child care centers maintain their payroll. Groups like the North Carolina Early Education Coalition pushed for $300 million in state funding to support child care providers in the transition away from federal relief.
The House and Senate鈥檚 opposing budget bills were in near agreement on how much funding to provide the child care industry, with the $135 million and the $136.5 million. But with many other budget fights still on the table, state lawmakers adjourned in late June without passing a state budget.
Instead, lawmakers stop gap child care funding until they return this fall to finish the budget. Before state lawmakers put their budget session on pause, they passed $67.5 million in emergency funding to the child care industry.
That funding provides less financial support than providers had received with COVID-19 relief, but it alleviates the full effects of a funding cliff, according to Angela Burch-Octetree, interim executive director of the North Carolina Early Education Coalition.
鈥淚nstead of a cliff, it'll be more like a slope. Now, it's still going downhill. It's still not great, but it's something to keep them going,鈥� said Burch-Octetree.
The short-term funding represents a portion of the proposed funding that House and Senate lawmakers had in their respective budgets.
鈥淭hey realized that they needed to make a quick decision, and that this was an actual emergency that they needed to pay attention to,鈥� said Angela Burch-Octetree. 鈥淚t's a little encouraging, but encouragement doesn't help your bottom line.鈥�
Child care providers will receive payments that are 75% of the amount they received in quarterly payments during the last several years. That means many providers will have to raise tuition or cut staff pay.
鈥淚t is still a cut, but it's better than nothing,鈥� said Carolyn Slade of St. Stephens Loving Daycare. 鈥淚鈥檓 deeply concerned if it鈥檚 not long term.鈥�
DHHS warns child care center closures could still be ahead
The North Carolina Department of Health and Human Services has administered the stabilization grants to child care providers. Since that system is already in place, the new funding will likely be in the hands of child care providers in a matter of weeks.
The Department issued a statement thanking the legislature for the stop gap funding:
鈥淲e appreciate the General Assembly recognizing that access to quality and affordable child care is critical to the growth and development of North Carolina鈥檚 children and our economic prosperity. This funding will provide some immediate relief with the looming child care funding cliff,鈥� NCDHHS spokeswoman Kandice Scarberry said in a statement.
However, the statement also warned of what might happen if the legislature doesn鈥檛 return this fall with more funding. An estimated 5%of child care centers in North Carolina closed during the pandemic.
鈥淲ithout further investments there will likely be more child care closures in the future,鈥� Scarberry wrote.
Burch-Octetree said advocates hope lawmakers will put child care at the top of their priority list for the state budget when they reconvene later this fall 鈥� and again when they begin negotiating the next state budget in January.
