Low-income child care vulnerable after no new revenue used to fix 2015 state deficit

Kevin Mathew, Copy Chief

Gov. Bruce Rauner signed a bill Thursday to fix the 2015 funding deficit, which had disproportionally hurt low-income child care centers.

The new law allocates $293 million for early childhood education by taking funding from other services and by cutting government functions 2.25 percent across the board. However, critics say child care centers for low-income families will still face instability until new methods of revenue are proposed.

Centers for low-income children tend to offer mainly state-subsidized programs through the Child Care Assistance Program fund, and when that fund faces sudden changes, low-income centers often do not have the reserve revenue to survive tough times. Sessy Nyman, vice president for policy and strategic partnerships at the child care advocacy group Illinois Action for Children, said centers most easily diversified their revenue sources by doing the same services they are trained for, while transitioning to a more private approach.

“(Centers) might minimize the percentage of low income kids that they take to the percentage of full fee paying kids,” Nyman said. “That then provides them the stability that they would need from a business perspective to say, well if something happens to the Child Care Assistance Program … I still have 65 percent of my monthly income coming in on a regular basis because those are private fee families.”

While Illinois sought a solution to the funding difficulties, centers relied on their own revenues and on the federal half of the CCAP after the state stopped paying its share. Nyman said low-income centers almost entirely relied on the CCAP and generally only pay off their debts month to month.

Because centers cannot cut services below a minimum level for each child, cuts can only happen by reducing the number of children who receive care, Nyman said. The state did not budget enough money for the CCAP at the beginning of the fiscal year, and the unexpected increase in services used this year made the existing burden even worse, she said.

“There’s no way that they can do justice by those kids and have any money at the end of the month,” she said. “So the state never shut down the Child Care Assistance Program, but individual programs have stopped receiving subsidy kids because they have no sense for if and when they would get paid for the care that they provided for the kids.”

Child care can “push liability,” meaning if costs fluctuate too high for a month, funds can be pulled from the next month for a temporary fix. This helps some of the inherent instability of day-to-day operations, but when centers rely on one source of funding, which then changes in an already uncertain environment, crises become too much for low-income centers, Nyman said.

State Sen. Daniel Biss (D-Evanston) voted against the new law. Biss said in an online statement this fix was not sustainable and did not address the state’s deep fiscal instability.

“I voted against these bills even though I appreciate that they were the outcome of a sincere bipartisan negotiation, and even though I recognize that it was essential to address our child care crisis,” he said in the statement. “I will push for budgets that truly demand shared sacrifice, instead of relying on sacrifices from poor and working families and our state’s most vulnerable.”

Childcare Network of Evanston executive director Andrea Densham said it should not be forgotten that these cuts were achieved with cuts to services. She said although CNE did not shut its doors while lawmakers debated how to fix the funding issues, most of that is because of the hard effort of CNE staff and community activism in Evanston.

Densham said the economic impact of child care on current and future generations cannot be ignored, and that the businesses and residents who came together for political activism in response to the funding issues made it clear to representatives that child care is an important issue for the northern suburbs.

“While I’m very relieved that we’ll be able to ensure continuity of services for our children and families in the northern suburbs, we have to attend to a thoughtful revenue-balanced budget moving forward,” she said. “I think advocacy work is always a challenge. I think what’s most important is that we talk about the issues and that it’s not seen as a campaign but seen as a long-term discourse about what matters in our community.”