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The Daycare Drought 

Thanks to a broken state government, the state of Humboldt County child care is getting worse and worse

It's the Saturday after Thanksgiving, and the shopping rush is on. Amid the shopping chaos, the checkout line at Michaels, a crafts store in the Eureka Mall, stretches from the front to the back. Carissa Bowser-Smith is working a register, and is happy to do so.

"Are you kidding?" she says. "To be where you only have to take care of one thing? It's like vacation."

Bowser-Smith, 29, works 14 hours a week at Michaels. It's a second job. For much of the summer and fall it was a 32-hour-a-week lifeboat that kept her full-time child care business in Eureka afloat -- barely -- when the state stopped paying its child care subsidy bills during a 100-day budget stalemate.

Over four months with only a single day off, she averaged 87 hours of work a week. She pink-slipped an aide, watched her enrollment drop on some days from 13 to three, and worried about making the house payment and paying for supplies such as infant formula, diapers and crayons.

Meanwhile, the state legislature vacationed and, depending on your point of view, negotiated, bickered or played chicken with other people's lives.

"I'm drowning," Bowser-Smith said back in September. "I could lose my home, and they don't care."

Humboldt County has 220 formally licensed child care facilities. Seventy-one percent of them run out of private family homes like Bowser-Smith's; the rest -- childcare "centers" -- are for-profit, nonprofit or public entities. Many -- the Arcata and Rooney-McKinleyville Children's Centers, Head Start and Early Head Start, for example -- contract with the state or federal government to provide free or low-cost slots to eligible parents and have a strong educational component. Others are reimbursed through vouchers from Changing Tides Family Services, which links low-income parents to the child care system.

State dollars have been disrupted before -- "yearly terrorism" is how family home provider Susan Smith termed it -- but Gov. Arnold Schwarzenegger proposed in May to make it permanent. He sought to eliminate $1.2 billion in subsidized child care for low-income families and terminate California's $1.6 billion welfare-to-work program, CalWORKS.

When the budget standoff ended Oct. 8 -- the longest on record -- subsidy money flowed again, but it came from a budget that is far from balanced.

An emergency session of the legislature failed this month to come to terms with a projected $25 to $28 billion deficit, leaving Bowser-Smith certain of one thing: she can't go through it again. This not the kind of life she envisioned after earning a two-year degree in early childhood education from College of the Redwoods so she could work at home and spend time with her two children.

"We're going to be right back in the same boat five months from now," Bowser-Smith said. "I'll wait it out the next couple of months, but if it gets to the point when I'm not getting paid anymore, I won't do child care. I'm already looking at what we can do about getting out of our house."

She and her husband, an apprentice electrician working on the CR administration building, bought at the high end of the market. Now they're underwater. Community Care Licensing Division, which oversees both day care and residential facilities for children and adults in California, isn't processing new applications. Thirty-two people are on the Changing Tides waiting list for the next orientation, whenever that may be, and site changes have been delayed in light of staff departures, hiring freezes and budget cuts.

"This has been the worst period for child care and the profession that I have seen since I came back to Humboldt County in 1989," said Mary Ann Hansen, a lecturer at Humboldt State University and consultant to First 5 Humboldt, in late October. "It's a disaster. When you don't have child care, parents lose their jobs and it's a domino effect for the whole economy."

Low pay, budget cuts, increasing costs, a recession and a reluctance by Californians to raise taxes to pay for services many say they want is creating what First 5 Humboldt Executive director Wendy Rowan calls "a perfect storm" in Humboldt County child care.

"My instinct is that the village does not understand what is happening to this fragile system," she said in early December. "It's a much more untenable situation for child care programs than before, and it is paving the way for a debate about whether we should have subsidized child care. Given the times we are in, a lot of parents need to work. How do we make that possible for them and good for the kids?"


California has long supported subsidized child care to help parents work and to provide early education and development for young minds.

The California Work Opportunity and Responsibility to Kids program -- CalWORKS -- is a $1.6 billion effort to provide cash and subsidies to parents who study and work toward self-sufficiency. It impacts 1.4 million people, 1.1 million of them children.

According to Changing Tides' Centralized Eligibility List, an additional 761 Humboldt County children qualify for low-income child care subsidies unrelated to CalWORKS. But the state funding for non-CalWORKS subsidies -- $1.2 billion -- is too little to serve the hundreds of thousands of eligible families.

The California Budget Project reports that the CalWORKS program is 40 percent smaller today than in the mid 1990s because hundreds of thousands of parents have made the transition from welfare to work.

But before signing this year's budget, the governor used his blue pencil to slash Stage 3 from the CalWORKS program to save $256 million. CalWORKS' "Stage 3" is for those have successfully moved off cash assistance for 24 months and into the workforce, but whose incomes remain low enough to qualify for a child care subsidy.

"It came out of the blue," said Carol Hill, executive director of Changing Tides Family Services. "It was outrageous. They are the families we expect to be the success stories in a complicated system that helps them work and live independently."

Since there is not enough money for child care to go around, Stage 3 funds are set aside specifically for those CalWORKS families making the last step from welfare to work.

"Without a child care subsidy, many of these families go back to public assistance, which is far more costly," Hill said.

A lawsuit followed. Those impacted got a stay when a legal settlement preserved services through Dec. 31.

Some of the other damage from the budget delay wasn't so easy to fix or forget.

The Winzler Children's Center closed for a month in July after 44 years of service. It re-opened as a part-time program, losing 33 of the 50 preschoolers it used to serve.

The Arcata and Rooney-McKinleyville Children's Centers avoided Sept. 1 closure only because First 5 Humboldt and the Headwaters Fund jumped in with a $150,000 bridge loan after two community banks refused to step up. Those two centers serve 80 children of people working for 61 different employers in the county, as well as eight self-employed entrepreneurs and eight Humboldt State students.

"We sold stock, asked for donations from families, tapped out our line of credit -- we used every resource we had," said Diana Herrera, the site director at Arcata. "We offered our property for collateral on a $150,000 loan, but the banks felt it was too risky to give a loan and then have to foreclose on a child center. That's not good for business."

At least seven family child care homes in Humboldt County shut their doors in May. Another five went in June.

Then there are the 58 families with 111 children served by 65 providers who learned from Changing Tides that their child care funding ended with Stage 3.

Many of the state's First 5 commissions provided local funding to extend Stage 3 services through year's end as the lawsuit settlement included no additional funding. They hope AB 1, introduced Dec. 6, will restore Stage 3 funding, but Judi Andersen of the Local Child Care Planning Council is not optimistic.

"I don't see it coming back," she said at a Dec. 2 media briefing about the state of child care in Humboldt County. "I expect child care to be hit even further as other programs are shaved, cut or squeezed."

Changing Tides, via a lottery last week, was able to place 82 children in 42 Stage 3 families with existing providers through June as long as they remain eligible. The other 29 children in 16 families were lost to other options, family moves and attrition. They didn't enter the lottery.

"It was a fluke to seamlessly transfer those children and families," said Hill. "That didn't happen in urban areas and we wouldn't have had the capacity here if not for our decision to hold off enrolling new people in programs when we didn't know the budget."

With damage to Stage 3 programs averted for now, Hill has time to take a breath and assess the damage.

"It looks like we were on target to lose about $550,000 worth or programs and services -- and $400,000 of it is child care payments this fiscal year," she said. "But there are still so many unknowns. Parents are unhappy. Providers are unhappy. This will be a rallying point for the critical economic importance of quality, affordable child care."


The National Network for Child Care traces the origin of daycare to Boston nurseries in the 1840s. For social and charitable reasons, daycare was meant for immigrant and working-class children of impoverished and sometimes widowed mothers who had to work and had no other family to turn to.

According to Elizabeth Rose in A Mother's Job: The History of Daycare, 1890-1960, charitable organizations "would not accept children of mothers who worked for any reason but dire financial necessity."

Even the Association of Day Nurseries, which dissolved in 1931, said "day nurseries should be a last resort."

The federal government's first foray into subsidized child care came when it sought to employ out-of-work adults during the Great Depression.

When World War II arrived, so did the need to put mothers to work in the production of war materials. The feds sponsored child care for 400,000 preschoolers during the war, and Henry Kaiser served another 3,811 children when he built the world's two largest daycare centers at the entrance to each of his Portland, Ore., shipyards in 1943. Designed with children in mind, they were open 24 hours a day and staffed with a nurse. Mothers and the company shared the cost.

Funding for both programs ended with the war. The government advised women to return home to take care of their offspring, but not everyone did. The ranks of women working have steadily increased since World War II -- and not without debate.

"No one ever entrusts her child to someone else," wrote Maria Montessori in her 1949 book, The Absorbent Mind.

"The child who needs daycare has a family problem," advised the Children's Bureau in 1963.

The very next year, though, the Economic Opportunities Act of 1964 funded Head Start programs. The first Kindercare followed in 1969. According to Humboldt State's Mary Ann Hansen, preschool came to be viewed as vital to developing healthy adults, and child care presented opportunities for more than babysitting.

"A 2-year-old has twice as many synaptic connections as an adult does," Hansen said. "That's the time to make connections and build foundations. Preschool helps elementary school achievement and it helps develop good attachment relationships, which seem to be the No. 1 indicator of optimal development."

Continuity of care is important for young children, Rowan said. Separation can traumatize children when their daycare program closes, or when aides, lead teachers or caregivers depart, or when parents who can no longer pay their share of cost withdraw them from people and friends they love.

"We now know that age 0 to 5 is a critical time for what the successes of children will be," Rowan said. "By the time a child is 5, brain structures have been formed."

That knowledge has fueled discussion about starting public school sooner. It also made it easier for working parents to feel they were doing right by their children to place them in good preschool programs.

Martha Johnson was a working parent. After 10 years of marriage ended in divorce, she had a 3-year-old and an 8-year-old to care for, $125 in child support and a good job at Humboldt State University. She relied on 30 months of subsidized child care to enroll her daughter at the Arcata Children's Center.

Her son enrolled in an after-school program.

"I knew if I had help in paying for child care that I could work at that job and create a life for us," she said. "I wouldn't have been able to work without that subsidy. It was the only program I relied on and it enabled me to go to work knowing that my children got good care. My life, and my children's lives, would have been very different without it."

Today, Johnson is the program manager for the Health Insurance Counseling and Advocacy Program at Area 1 Agency on Aging. Her daughter is a 30-year-old single mom with a 6-year-old son; her son a 35-year-old husband and father of two.

"They've had their daycare dilemmas: losing a job and giving up a slot in daycare that you may not get back once you get another job," she said. "It's tougher on young people now. Subsidies are more important now than ever."


In January, President Obama told a White House Middle Class Task Force that child care is a critical investment needed to support working parents, about 15,000 of which live in Humboldt County, according to a June 2010 report from Humboldt County's Child Care Planning Council. Those 15,000 parents potentially need care for some of the county's estimated 17,021 to 21,749 children.

"The No. 1 reason people seek child care is to work or seek employment," said Dawn Elsbree, Headwaters Fund coordinator, a couple of weeks ago. "It's clear to me: If people are not able to access child care, they are not able to go to work. Think of the ripple effect that will have on our economy."

Daycare is not cheap. Bowser-Smith charges $32 per day; Susan Smith $29. At 10 hours of full-time care, it's around three dollars an hour, but they still hear complaints about a monthly tab of $638 to $704.

"Everyone says child care is so overpriced and why do you charge so much?" Bowser-Smith said. "Sometimes, I get offended."

"Six hundred a month times 12 sounds like a lot, until you take out payroll, supplies and everything else," said Smith, a 53-year-old provider who works out of a home she bought 24 years ago.

"I have no retirement, no health insurance, and a high stress job. And now they want you to have a B.A. degree. You can get one from HSU and then get paid $10.50 an hour. Prison guards have more. So do prisoners. They get health care."

Bowser-Smith's family lives in a two-bedroom home on West Carson. The living room is the daycare playroom; the family's living space is in the converted single car garage. Her work hours are extended because the parents of her daycare children aren't finding jobs that let them work normal business hours.

"Everybody's hurting," she said of a county with 10.4 percent unemployment in October. "I'd love to have more private pay people, but parents have lost jobs, gone part-time and are juggling schedules."

The National Association of Child Care Resource and Referral Agencies reports full-time employment among families with children 12 and under has declined since 2008, while part-time employment has increased. Bowser-Smith got a call from a private payer who needed afternoon coverage from five to 15 hours a week for her baby, but she turned it down in favor of a full-time person. With a waiting list, she can be choosey.

Bowser-Smith's 14 children are subsidized by the state. The maximum family care home subsidy is $540 for full-time care of 2- to 5-year-olds and $605.93 for CalWORKS children under 2. It's significantly higher in centers, at $1,014 for a full-time infant and $681.34 for full-time 2- to 5-year-olds.

Susan Smith has only one subsidized child -- and intends to keep it that way.

"I lost five customers when the state stopped paying and had to figure out how to make up $3,000 in income," she said. She, too, eliminated an assistant in the summer and restored the spot this fall.

Need and income determine eligibility and a sliding scale of co-payments. Parents must cover the gap or remove children from care when the state fails to pay its bill or providers charge more than the maximum state subsidy.

A working family of four with two children and a gross income of $35,000 a year qualifies for subsidized care; the same family grossing $50,300 per year does not. Enrolling the subsidized family's potty-trained 3-year-old in the Arcata Children's Center means a parental co-pay of $3.45 for part-time or $6.90 for a full-time day of 6.5 to 9.75 hours -- around $150 per month for full-time care. That family could gross up to $4,188 a month and still qualify for a state subsidy that has not been increased since 2005. Their contribution at the top end: $19.20 a day for the first child, nothing for every child after that.

"If both work and one gets a raise, that could put them over the income limit," Hill said. "We heard of one parent pleading with an employer not to give a raise because it would mean losing child care, which is really a sad state of affairs."

One year of full-time family child care for one costs an unsubsidized family more than three semesters of resident fees at Humboldt State University. Nicole Morrow and her husband, Jason, couldn't afford full-time child care for their two children. They have college degrees and work full-time: She's an economic development specialist for the county; he's in team sales at Sport & Cycle. They relied on her mother to keep paid child care to three days a week, and then, once her oldest started kindergarten, every afternoon.

"It would have been $60 a day," she said. "You'd have to make well above minimum wage after taxes just to break even."

The Morrows live where they grew up. That's become less common as mobility as the end of the agrarian age separated families. She wonders what happens to the children of those without money, or without family that can help.

"The scariest scenario is if they are home alone," she said. "People have to work."

In its August 2010 report, the National Association of Child Care Resource and Referral Agencies says over the last decade the cost of child care has increased twice as fast as the median income of families with children. In every region in the U.S., center-based fees for an infant exceeded the average annual amount families spent on food.

"There's a wish for the idealized past, to go back to the Leave it to Beaver days where someone stays home with the children," Hansen said. "That can't be done, yet there seems to be a debate about do we even [need to] have child care at all? Families don't have resources, and we need child care if we want families to be self-sufficient."

According to the county's June 2010 Child Care Needs Assessment, the cost of full-time care for an unsubsidized infant in a child care center is 19 percent of the $32,984 median income for an average Humboldt County family.

"That may be the single most telling statistic in that needs assessment," Hill said.

It's the one that shows the steep price of child care. It may not be affordable, for the family or the state, but neither is the alternative.

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