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Without New Federal Money, California Child Care Providers Brace For Pay Cuts

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California home-based child care providers – who already often make less than minimum wage – are bracing for lower reimbursement from the state.

In normal times, low-income families in California paid for child care through a combination of state subsidies and an out-of-pocket rate called a family fee, which is based on their income relative to the size of their family.

When the pandemic hit, the state waived these fees for families – both those who needed in-person child care and those who chose to keep their kids home or lost their jobs – and continued to pay providers the fee.

Starting Oct. 1, if kids aren’t coming to child care in person, the state will no longer reimburse the family fee for providers unless there’s additional federal funding. (All the nitty gritty details are in Senate Bill 820, which you can read in full here.) The providers will only receive the state subsidy -- which is not enough, they say, to cover rising operating costs.

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Los Angeles provider Sylvia Almaraz, who unlike many providers never closed during the pandemic, estimates she’ll be losing about $900 a month without the fees from families who still haven’t returned to her daycare.

She’s paying more for hard-to-find cleaning supplies, she’s had to upgrade her internet to accommodate distance learning, and she’s now caring for more school-age children, which require more food and other supplies.

“We need to work, We need to pay our bills. So we do it,” Alamaraz said. “We don't know how we do it, but we do it.”

Almaraz could take on more kids -- her license allows her to care for up to 12 at a time -- but she says it doesn’t make financial sense right now.

“If I have more kids, I need more helpers,” Almaraz said. “I need more cleaning stuff. I need more food. It's gonna be more water, more electricity and more supplies.”

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Child Care Providers United is holding rallies throughout California today asking state leaders to increase the funding for child care. The union estimates more than 800 home providers in Los Angeles have closed during the coronavirus pandemic.

The state agency that licenses child care said in an email that 1,547 child providers, including centers, closed permanently between March and August 31 this year.

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