Government budget deficit could delay new childcare funding

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Every weekday, Patricia Moran has up to a dozen children at her home daycare in San Jose, mostly from low-income families, and sometimes children are only 2 weeks old because their parents can’t afford more rest. From the job.

In between helping kids make soap bubbles, serving them food at a large table with little chairs, and teaching them “Twinkle Twinkle Little Star” in English and Spanish, Moran said she’s been answering phone calls from other parents – sometimes up to four a day. who are desperately trying to find care for their young children.

That’s why Moran was surprised when Democratic Gov. Gavin Newsom, who is just starting his second term, proposed deferring funding for 20,000 additional places for subsidized child care for low-income families to help balance the state budget.

Even more bewildering was the reason for Newsom’s delay: childcare places that had already been funded were not yet in use.

“They need (these vouchers) right now,” Moran said. “Parents, they have to go to work.”

It’s true that there’s a lot of demand for subsidized childcare, and it’s also true that much of the funding California has already allocated has not been used—a paradox that reflects the state’s roller coaster revenue and the odd funding decisions that are coming up.

For the past four years, the state has had so much money that it has not been able to spend it fast enough. With record surpluses fueled by billions of dollars in federal pandemic aid, Newsom and state lawmakers paid for 146,000 new childcare places for low-income families. That’s so many new places – more than double what was previously available – that government officials can’t fill them up fast enough.

Publicly funded childcare workers must be licensed by the state, a process that requires background checks and inspections to ensure daycare centers, some of which are home-based, are safe and secure. The entire process can take up to a year.

Once the administrative hurdles are cleared, family registration may take longer. Farooq Azhar, executive director of Sacramento’s BJ Jordan Child Care Program, said he has 4,700 families on his waiting list. When it comes time to enroll, some families don’t respond, some don’t follow the rules, and others just “take a long time to complete the necessary paperwork,” he said.

Now that the state’s revenues are falling due to a slowdown in the stock market, California’s deficit is estimated at $22.5 billion. Deciding not to dig into reserves, Newsom scoured the state’s vast bureaucracy for savings. Deferring funding for 20,000 new childcare locations would save $134 million.

Even though this is a relatively small amount, it can have a big impact. The delay puts Newsom and the newly formed childcare workers’ union at odds just months before their first contract expires. And that upset the Legislative Assembly’s women’s caucus, which, after winning the November election, now makes up almost half of the Legislative Assembly. Their support will be key to moving forward Newsom’s agenda during his second term.

“We want child care to (continue) to be a priority,” said Assemblywoman Cecilia Aguiar-Curry, Democrat of Winters, vice chairwoman of the California Legislature’s Women’s Caucus. “Women want to go back to work. We need them to support the economy.”

The California Department of the Treasury, the agency responsible for budgeting Newsom, said the administration “remains committed to expanding access to childcare in line with budget agreements,” according to agency spokesman H.D. Palmer.

The Office of the Legislative Analyst, a non-partisan agency that advises the Legislature on budget decisions, said Newsom’s plan “seems reasonable.”

“Overall, we do not expect access to childcare services to be significantly affected given the number of currently unoccupied places,” the LAO said in a statement.

Child care providers say the bigger problem is that there aren’t enough workers to fill the vacant positions. According to the California Public Policy Institute, California lost a third of child care jobs in the first two months of the pandemic, compared to the state’s overall job loss of 15%. While many of these jobs have returned, the childcare industry is still below pre-pandemic levels.

Subsidized places pay only about 75% of what childcare workers have to earn on the open market, making it difficult to recruit new workers, advocates say. Nearly all childcare workers in California are women, and most of them are people of color, says Lea Austin, executive director of the UC Berkeley Childcare Employment Research Center.

Many childcare workers say they are often paid less than the minimum wage after expenses are deducted.

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“People have other options,” Austin told lawmakers during a public hearing earlier this month. “When we look at wages…the pandemic has really been a kind of watershed for many.”

Moran said she sometimes takes home $3,000 every month after expenses that include supplies, two assistants, insurance, and utility bills. She has to keep the heater and air conditioner running more than in a typical home to keep the kids comfortable. She said her January gas bill was $600.

Many times Moran thought about closing the kindergarten, but never could do it. She has a bachelor’s degree in child development and sees her job as preparing these children for life, including teaching them to interact with others with empathy—something she says takes “all my heart.” my mind.”

But phone calls from her parents changed her mind.

“I’m like, ‘Oh my God, what happens if I close mine too?’ she asked.

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