Source: EdNC
Since July, following the approval of state funding to replace expiring federal child care support, North Carolina has seen a net loss of 69 licensed child care programs. This is nearly double the net loss from April to June.
The state Department of Health and Human Services (DHHS) recently distributed $67.5 million, covering about 75% of the previous federal funding. This funding was passed by legislators in late June, just before federal assistance ended on July 1. However, for over two months, child care programs had operated without stabilization funds, prompting concerns about closures, increased prices, and declining quality.
When EdNC inquired on Aug. 22 about the delay in distributing state funds, a DHHS spokesperson emphasized the importance of these funds for child care providers. The department is working with the Office of State Budget and Management to expedite distribution but stressed the need for additional funding to stabilize the industry, which is crucial for the state’s workforce.
A February survey by the North Carolina Child Care Resource & Referral (CCR&R) Council revealed that one in five providers anticipated closing within a year without external funding. The loss of 69 programs, as noted by Linda Blanton from Child Care Resources Inc., reflects a 1.4% reduction in licensed programs between July 1 and Sept. 19.
Jason Carrow, director of Care-O-World Early Learning Centers in Eastern North Carolina, shared that his program had depleted its savings over the past two months. He stressed the necessity of additional funding, explaining that the current situation— a 25% reduction in income—was unsustainable, especially given rising inflation.
State legislators are scheduled to meet twice more before the end of the year when state funding is set to expire. Gov. Roy Cooper has urged them to take action before more child care centers close, more early childhood educators leave, and the cost of care becomes unaffordable for families. Cooper emphasized the importance of child care for children’s development, parents’ ability to work, and businesses’ functioning.
While advocates had pushed for $300 million in stabilization funds, and Cooper’s budget proposed $200 million, the legislature only allocated $67.5 million to last through December. Legislators had indicated they would return later in the year to pass a budget, but in September, they passed a mini-budget without any additional child care funding. Legislative leaders, including House Speaker Tim Moore and Senate President Pro Tempore Phil Berger, had not responded to questions about further child care funding plans at the time of publication.
For Anna Mercer-McLean, director of the nonprofit Community School for People Under Six in Carrboro, the last two months have been tough. Her program survived but had to raise tuition in August to keep paying teachers. The state funding, while less than what they had previously received, arrived just in time to help meet payroll.
Running a child care program, she said, has always been a financial balancing act. Even before the loss of federal funding, programs struggled to offer competitive wages without making care unaffordable for families. Mercer-McLean noted that while they try to minimize the burden on families, the true cost of care is even higher than what parents are paying.
Carrow has also made sacrifices to keep his program afloat, including raising tuition, charging families a supply fee, and increasing teacher-to-staff ratios. But these changes come at a cost to quality, reducing one-on-one attention for children. Cutting wages, he said, is not an option, as staff could easily find higher-paying jobs elsewhere.
Some states have replaced the federal child care relief funds with state dollars or created permanent public funding streams. North Carolina, once considered a leader in early childhood policy, has seen stagnation in funding, according to advocates like Kristi Snuggs, president of Child Care Services Association. Snuggs believes a combination of federal, state, family, and business support is necessary to address these longstanding issues.
Carrow warned that without sustained funding, child care, particularly in rural areas, will become increasingly unsustainable. He predicts that within a few years, rural communities may face significant challenges in accessing child care.
