Sept. 30 may represent child care cliff as emergency federal funding runs dry

Child care has long been unaffordable and inaccessible for many Americans, costing parents over $10,000 a year on average while more than half of the population lives in "child care deserts" with insufficient supply.

Industry advocates warn that the situation could grow even worse in the months to come.

States are expected to face a steep decline in federal child care investment starting Sept. 30, the expiration date for pandemic-era funding that has helped stabilize the sector over the past two years. The funding cutoff could result in the loss of 70,000 programs and more than 3 million child care spots, according to The Century Foundation, a progressive public policy think tank.

“This money has been a lifeline,” said Julie Kashen, senior fellow and director for women’s economic justice at The Century Foundation. “It has allowed providers to keep their doors open, to enroll more children. It has really allowed parents to be able to go to work knowing that their kids are being cared for.”

PiggyToes owner/operator Trish Watts encourages children to play with blocks at the day care's new location in Grovetown, April 22, 2022.
PiggyToes owner/operator Trish Watts encourages children to play with blocks at the day care's new location in Grovetown, April 22, 2022.

'When the math no longer adds up ... I won't do it again. We'll close.'

The $24 billion Child Care Stabilization Program, passed through the American Rescue Plan of 2021, allocated funding to more than 220,000 child care programs and covered as many as 9.6 million children, according to the U.S. Department of Health and Human Services.

Assistance was awarded to more than 80% of licensed child care centers across the country, which used the money to cover expenses like personnel costs, rent and utilities, and personal protective equipment.

The American Rescue Plan also provided $15 billion to expand the Child Care and Development Block Grant, which helps low-income families pay for child care. That funding is set to expire at the end of September 2024.

Melissa Colagrosso, CEO and senior director of A Place To Grow Children's Center in West Virginia, said the additional funding meant the child care center could staff up by offering bonuses and make "much needed" infrastructure improvements, including updating lighting and replacing outdated HVAC systems.

Colagrosso has been running the center since 1995, but she’s not sure she’ll be able to keep the business afloat once the additional money runs dry.

“We spent many, many years borrowing to make payroll because the math doesn't add up in this industry,” she told USA TODAY. “When the math no longer adds up and I go back to borrowing money to sustain this business, I won't do it again. I won't do it again. We’ll close.”

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