Delay in federal child care subsidy concerns Springfield child care providers

Kimberly Shinn-Brown: Funding delay raises concerns for child care providers.

Jennifer Crouch: Private child care centers may be in danger of closing.

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Missouri education officials notified child providers Tuesday that federal child care subsidy payments for December will soon be released.

The delay, prompted by scrutiny over spending in other states, created headaches and uncertainty for Springfield area child care providers.

Carly Walton, owner of Peapod Learning Center LLC, was owed $15,000 in funding from a child care subsidy program for December. She said without the funding, it would have been difficult to keep paying staff and serving families.

“For a small business, that is a huge amount,” said Walton, who has 11 employees. “Most of our overhead is employee pay so I am trying to figure out where I am going to pull that money from so I can continue to keep people on staff.”

Half of the 36 children enrolled in the center at 2115 S. Brentwood Blvd. qualify for a federal subsidy program that reimburses child care providers who serve foster and low-income children.

“We want to be able to help families that are low-income,” she said. “But we also want to make sure that we can keep our doors open.”

Missouri child care providers have been in limbo waiting for the federal government to release $25.7 million in subsidy payments for December.

Missouri Department of Elementary and Secondary Education, which showed 36,876 children were approved for the assistance, notified providers that funds should be released by Jan. 16.

Providers who are not paid by Jan. 20 are asked to notify DESE.

Walton said ongoing instability in the subsidy payment process may eventually limit options for families that rely on help.

“This is really going to blindside a lot of families because there are going to be (providers) who cannot afford to keep those kids without getting paid,” Walton said. “It is going to absolutely flood the market with families that are looking for care and probably won’t be able to find it.”

A total of 1,743 Missouri child care providers, or 53%, were impacted by the delay in federal payment, according to DESE.

“Our priority is to ensure Missouri families and children continue to have access to safe and quality child care,” said Commissioner of Education Karla Eslinger, in a news release.

The U.S. Department of Health and Human Services froze access to certain federal childcare and family assistance funds Jan. 6 for five states: California, Colorado, Illinois, Minnesota, and New York. The freeze was ordered shortly after allegations of fraud were leveled by YouTuber Nick Shirley against child care centers in Minnesota.

The Office of Childhood, part of DESE, has not been able to access federal funding to pay providers. Other states have reported the same problem.

The federal government asked Missouri to provide detailed justification for the pending child care subsidy payment. DESE reported that it submitted that documentation Jan. 9.

To qualify for a subsidy in Missouri, families must be at or below 150% of the federal poverty level, which is $48,225 for a four-person household in 2026, and need child care to work, attend school or participate in job training.

Jennifer Crouch, director of the early childhood education center at Ozarks Technical Community College, said the subsidy helps “some of our state’s most vulnerable children,” including those in foster care.

She said half of the children enrolled in the center are eligible, and the December subsidy payment was expected to be $41,800: “That is for services already rendered.”

Crouch said the Ozarks Tech center can withstand short-term funding delays because the college provides a financial cushion.

She said without reliable payments, small and private providers may “go out of business.”

“For a small business, it is whether or not they make payroll, whether or not they can purchase food to feed the children,” Crouch said. “They’re operating on very thin margins.”

This delay was not the first hiccup in the state’s child care subsidy program. Much of the past year was devoted to resolving a prior software program the resulted in inconsistent and incomplete payments.

The Ozarks Area Community Action Corporation serves 434 children in Head Start and 232 children in Early Head Start in a 10-county region including Barry, Dade, Dallas, Christian, Greene, Lawrence, Polk, Stone, Taney and Webster.

Kimberly Shinn-Brown, director of the program for OACAC, said the nonprofit agency receives about $2 million annually from the child care subsidy program.

“It’s definitely an important part of our budget and it helps offset the hours of care we provide for full-day, full-year kids,” she said.

She said the availability of other funding allows the program to operate without interruption for a period.

Shinn-Brown said if the delays in the subsidy payments “continues to be a pattern, then we may have to look at what our options are.”

She said the funding delay raises concerns for the “landscape of child care as a whole.”

“Child care operates on such a tight margin, and for programs to not get paid when they’re being paid retrospectively, instead of prospectively, they can’t carry the costs and make payroll and cover all of their other bills when there is a delay,” she said.