Legislators return next week for their last session before state child care stabilization funds run out at the end of December, and advocates are requesting a one-time allocation of $100 million to avoid closures and price hikes for parents.

Rep. Donny Lambeth, R-Forsyth, said in June that he expected legislators to allocate more child care funding before the end of the year. But Lambeth said Tuesday that he now does not expect the legislature to provide any new funding until next year’s long session.

“It is unlikely the GA will deal with any new appropriations until the 2025 GA convenes next year,” Lambeth wrote in an email. “This is being looked at closely with staff but we need to evaluate alternates to just adding more funds. We have been evaluating those options and talking to colleagues in other states to see what they do.”

Advocates are asking for the one-time funding to sustain families and child care programs until legislators convene next year to craft a budget.

“We know that folks can’t afford to wait until next June for there to be an answer to this crisis,” said Chanelle Croxton, director of state strategies and organizing for the National Domestic Workers Alliance.

‘Already a big problem’

In the coming months, a lack of state action would leave programs without extra funding they have been using to maintain teachers’ wages and keep tuition rates from increasing. A survey in February found that the end of stabilization funding would lead to the closure of about 20% of the state’s child care facilities within a year.

The funding had been scheduled to end at the start of July 2024, and advocates asked for $200 million in one-time funding over the summer. The legislature in June allocated $67.5 million to send to licensed child care centers and family child care homes, replacing 75% of what programs had been receiving through federal dollars from the American Rescue Plan Act since 2021.

Before the new funding reached programs, the state experienced a net loss of 69 programs from July to mid-September, a 1.4% decrease in the number of licensed programs.

An October report from advocacy nonprofit NC Child and the state Department of Commerce found that one in five employers cited child care issues as a barrier to hiring. It also found there were 100,000 fewer working-age parents with young children participating in the labor force in 2023 than in 2019.

Neil Harrington, NC Child’s research director, said the exhaustion of the state funds at the end of December will likely exacerbate these economic consequences.

“You’ll see more parents not be able to access child care, which might impact their ability to work, and our reports from this year show that’s already a big problem,” Harrington said.

He mentioned another report, released in June by NC Child and the state and national Chamber of Commerce Foundations, which found that 25% of working parents had experienced a job disruption in the past year because of child care issues.

“Without that stabilization grant funding, and as we approach that cliff, if we go over it and more providers close, you’ll see that number increase even more,” Harrington said.

‘Some of the most important work that there is’

A lot has changed since programs started receiving federal stabilization funding in 2021, said Lynquay Harrison, owner and operator of Open Arms Child Care of NC, a family child care home in Wendell.

“It doesn’t add up,” Harrison said. “The mortgage went up because the property value went up. My taxes went up, water went up, electricity went up, food went up. With subsidized care, you only want me to charge a parent about $195 a week, really? I mean, that’s one week of groceries.”

The child care industry is described by experts as a market failure, meaning that it’s impossible for child care businesses to produce the desired product, high-quality care, at a rate that is affordable to most parents. That leaves care unaffordable for many while child care teachers make some of the lowest wages of any industry.

Most programs have used the stabilization funds, first from the federal government and then from the state, to boost teacher compensation.

Harrison also used the funding to cover fees for parents getting child care through the state’s subsidy program.

“The funds helped me to help parents who are in those type of situations,” Harrison said.

One of those parents is Johnetta Rembert, a single mother of two who works as an insurance specialist. Rembert’s 3-year-old son, JoMori Gause, has been attending Harrison’s program since he was 4 months old.

Rembert said she remembers crying when she first dropped JoMori off. She hadn’t used child care with her older son. But her circumstances had changed.

“You’ve got to work,” she said.

Three years later, Rembert is considering pulling JoMori out of the program as the stabilization funds end. She is heartbroken, she said.

“I can’t afford it,” Rembert said. “The parent fee is just high, especially when you’re a single mother trying to make things happen. It’s a lot.

“I can’t imagine him not being here until he goes to kindergarten. The fund did help while it was here a whole lot, because it took a lot of stress off me as a parent… I always tell people, if something happened to me, I want him to go with Ms. Lynn. I want her to take him in. That’s how much I trust her.”

Croxton said the advocacy community is trying to elevate stories like Rembert’s.

“It feels really abstract to decision makers, but when you’re in a place where you have actually made those connections with someone who is taking care of your child, who is educating your child, and you found a really great environment, the thought of losing that, it matters a lot,” Croxton said. “… We always want to emphasize that this is some of the most important work that there is in our state. We can’t continue to (use) piecemeal solutions. This is an essential function of every community, and it should be treated as such, and it never has.”

Hopes for the long session

Lambeth and others have pointed to next year’s long session as an opportunity for the state to find long-term solutions to child care challenges.

No one has laid out what those solutions will be, but legislators have piloted a cost-sharing program for the last two years that splits the cost of child care between businesses, parents, and the state government.

The pilot program, called Tri-Share, is being implemented in three regions covering 14 counties. The model was originally created in Michigan as a retention tool for businesses struggling to keep parents of young children on their payroll.

Local Smart Start partnerships are facilitating the program. Some advocates say they think legislators will be open to expanding this kind of public-private partnership to help cover the cost of care. The program is open to only a small section of the workforce, and participation is voluntary.

Advocates also are calling for state funding to distribute subsidy assistance more evenly across the state, expand education-based wage supplements for child care teachers through the WAGE$ program, strengthen NC Pre-K and Smart Start, provide free child care for the children of early childhood teachers, and improve educational pathways to early childhood careers.

“It’s just something that has rippling effects for everyone, because it is such a foundation for our community and for our economy,” she said. “We know this to be true because we’ve seen it happen. We’re seeing it happen. And if they don’t do anything right now, we will continue to see those centers close at probably more escalated rates.”