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A New York grant meant to help child care providers is actually making their work more difficult

Christina McCarthy looks into the toddler room at Tri-Town Kids.
Amy Feiereisel
Christina McCarthy looks into the toddler room at Tri-Town Kids.

The state has used emergency pandemic funds for some initiatives, but it’s also now built them into the yearly budget. Gov. Kathy Hochul pushed for New York to invest $4 billion over four years, from 2023 to 2027, into improving the state's child care system.

Past and present grants, initiatives, and programs include CARES Act emergency funds, provider stabilization grants, workforce retention grants, an expanded child tax credit, and dramatically expanding eligibility in the statewide Child Care Assistance Program. A number of initiatives are designed to retain and build a new child care workforce.

One of those programs is the $100 million Child Care Deserts Grant for New Providers and Existing Providers.

Its goal is to build child care capacity in child care deserts by making grants to support new and existing child care providers as they open or expand child care centers, home-based daycares, and after-school programs.

New York's Office of Children and Family Services (OCFS) says more than 540 new and existing providers have received grants and opened programs through the Deserts Grant.

But the program has also drawn the ire of providers and child care professionals. They say the grant has been riddled with red tape, unreasonable expectations, and no one to turn to for help.

Opening day cares and centers in 'Child Care Deserts'

Brasher Falls is a town of just under 700 people, about halfway between Potsdam and Massena. The town and its surrounding area are the definition of a child care desert; a year ago, there were no child care providers within a 20-mile radius. Areas like this are exactly what the Deserts Grant focused on.

Nearly the entire North Country region is considered a 'child care desert', with less than 1 spot available in care for every 6 children.
Child Care Coordinating Council of the North Country
Nearly the entire North Country region is considered a 'child care desert', with less than 1 spot available in care for every 6 children.

This is where 38-year-old Christina McCarthy opened Tri-Town Kids, a child care center, on Nov. 28, 2022. It has the capacity for at least 44 children.

Outside the center is a huge, fenced-in play area that covers about a half acre. It's surrounded by fields of corn.

"So we sit on three acres of land," said McCarthy, "and we are surrounded by corn. The joke is 'knee high by the Fourth of July.' And we were pretty close to that."

They dug and planted a garden this spring, and have planters scattered around the yard. On the day I visited, they had a picnic outside. "And our pasta salad that we made had cherry tomatoes that our kids picked from what they planted," said McCarthy, all smiles.

The child care center itself is a big gray building, about 5,000 square feet. In previous lives, it was a bar and restaurant, a night club, storage units, and, finally, an auction hall.

McCarthy says turning it into a day care was a lot of work.

There are currently around 35 kids in care at the center. McCarthy said they expect over 40 children in care by the end of the year. In many ways, McCarthy should be the poster child of success for New York’s Child Care Deserts program.

Unrealistic timelines

McCarthy applied for a Deserts Grant to open this center, and she got it. But she’s not sure she’d do it over again. "I think the biggest thing with the state is that they rolled this grant out with good intentions," said McCarthy. "But it was too fast. So you were trying to operate before the information was there. But they were setting the deadlines saying you had to operate without the information there."

She said it was a struggle from the very beginning, when grantees were informed they had been pre-appoved for the grant over a month late.

"They told us mid-June, and we heard back in late July," said McCarthy. "And from that date, we had 120 days to open."

McCarthy and all the other grantees (whether they were home-based daycares or full-blown centers) had 120 days to open, or they’d forfeit the whole grant.

For a home day care, 120 days wasn't a herculean ask; they might have to make a few changes to their home to come up to code. But for centers, it was a totally different ball game.

Christina McCarthy, with her husband and son, inside the child care center she opened in Brasher Falls, NY, in late November of 2022.
Amy Feiereisel
Christina McCarthy, with her husband and son, inside the child care center she opened in Brasher Falls, NY, in late November of 2022.

In McCarthy's case, she had to buy and renovate her building, and then get it licensed and inspected, all in a four-month period. "So that was being completely licensed. That was your building completely inspected. Thirteen inspections, from fire to water to electrical ... your certificate of occupancy, state inspection from your licenser. There were so many!"

McCarthy said it was a terrifying and exhausting process. They were afraid they'd miss the deadline, which meant they would never see a cent of grant money. She didn't want to let herself or her community down, especially since the center received about $34,000 for a new HVAC system from Brasher Falls, appropriated from the town's American Rescue Plan Act funding.

McCarthy and her husband did manage to open in 118 days. But she says it only happened because they had friends and family who helped them, and local contractors who worked through the night. She said the 120-day limit was an unrealistic timeline to put on new providers like herself.

The state department that runs the program, the Office of Children and Family Services, defended the timeline, saying it was stated in the grant application. According to OCFS, 540 child care providers successfully opened programs. That includes McCarthy's center in Brasher Falls.

A catch-22 and 'challenging parameters'

Christina McCarthy acknowledged that she went into this brand new. It was her first time in child care, and her first time opening a center.

But several directors of Child Care Resource and Referral Agencies (CCR&Rs) also said the 120-day timeline was unrealistic. There are 43 of these agencies in New York, and they work at a county level, helping child care providers to open and operate.

Bruce Stewart directs the CCR&R in St. Lawrence County, the St. Lawrence County Child Care Council. He said the 120-day timeline was "definitely a stretch," as opening a center is "typically a six-month to one-year to two-year process."

Jamie Basiliere, from the North Country Child Care Coordinating Council which serves Clinton and Franklin counties, had stronger words about the timeline. "They were in a catch-22. There was no way to be successful," said Basiliere.

Basiliere helped 17 providers apply for the Desert Grant in her area. Nine providers got the grants, and seven were able to get licensed in time.

She said almost all of her providers struggled with the 120-day timeline, especially since there was no upfront grant money. She said the Deserts Grant parameters made it challenging for anyone to succeed "unless they never needed the money in the first place and had lots of money and cash flow."

Missed quarters...

Basiliere says that’s because of the initial 120-day timeline, but also because of the way the Deserts Grant program docked money from grant payments.

For example, the first of the eight Deserts Grant payments was scheduled for just two months after grantees were told they could get started. They were informed in late July and the first 'quarter' ended on Sept. 30.

If a day care or center wasn’t licensed within that first 60 days (which Basiliere said was a near impossibility unless the provider already had the ball rolling before they were informed) they forfeited their first payment, an eighth of the total awarded amount.

For Christina McCarthy, in Brasher Falls, that was a $50,000 dollar loss. She was approved for $400,000, but because she hadn’t bought, renovated, and opened her center in 60 days, her number dropped to $350,000.

That was a shock, and wasn't clearly communicated, said McCarthy. "I'm a business person," she said. "And I budgeted for the $400,000."

When asked why the first grant payment was denied to so many grantees, OCFS's response was that, "Requirements and deliverables are detailed in the RFA. The grant purpose was to increase a ready supply of child care slots. The question implies that providers should have been paid the grant even if they hadn’t actually created the additional supply. That was not the purpose of this particular grant."

...and docked payments

Jamie Basiliere worked with a home-based daycare provider who had a licensing infraction early on in the grant. She said the provider didn't transpose her timesheets onto a specific state form, and the state penalized her with two docked grant payments, a loss of $46,000.

Just talking about the situation nearly brought her to tears. "That's just wrong. I know about grant compliance, it's the story of my life," said Basiliere. This was something else. "There were records! You know, there were employment records on file. They just weren't on the right form. So we're gonna dock an entire payment?"

This gets at what every director and provider I spoke with said was the problem with the Deserts Grant: that it was extraordinarily restrictive, and even punitive, often to the financial detriment of providers.

Child care providers are largely low- or middle-income women. They work in an industry with paper-thin profit margins. But Basiliere said there was little grace in the Deserts Grant if a new provider made a mistake.

"This woman is an entrepreneur, she is a sole proprietor. She like did this on her own, this is like on her nickel," said Basiliere.

Inside one of the toddler rooms at Bright and Early Discoveries Child Care Center, which is run by Jennifer LaMaina.
Jennifer LaMaina
Inside one of the toddler rooms at Bright and Early Discoveries Child Care Center, which is run by Jennifer LaMaina.

Other grants versus the Desert Grant, a 'lack of trust'

It’s important to note that this is not the only child care grant or initiative being run by the state, but just one of over a dozen. They include CARES Act emergency funds, an expanded child tax credit, and seriously expanding eligibility in the statewide Child Care Assistance Program.

Jamie Basiliere and Bruce Stewart, the CCR&R directors, said other grants have been really successful, like the Child Care Stabilization grants. That gave one-time payments to providers to keep them afloat during the pandemic. They were relatively red tape-free, and trusted providers.

That’s what’s missing with the Deserts Grant, said Jennifer LaMaina, a child care provider in Long Island.

"It’s almost like they don't trust us to make business decisions," said LaMaina. "And we've already put so much on the line to open up a business and run a business. I feel like they're taking that part away from us."

LaMaina currently runs seven child care programs down in Long Island. She opened three new child care programs through the Deserts Grant program. She also said she's struggled with the Deserts Grant, and has lost money to docked payments.

Staffing to capacity instead of attendance

Both Christina McCarthy and Jennifer LaMaina have lost sleep over a specific Deserts Grant requirement, which they say was not communicated to them until after they opened.

Here’s what that means: if you have the capacity for 10 infants, but three babies are in the room, you still have to have enough staff for 10 infants. That's a scenario LaMaina found herself in. To be compliant, she'd have to pay five people to take care of three infants.

She said staffing to capacity would bankrupt her, that you can’t pay five people on three infants' tuition. It’s actually cheaper to forfeit part of her grant payment than to pay workers to do nothing. "It put a hardship on me because tuition wasn't enough to pay five people. I relied on that grant and I lost 25% of my payment," said LaMaina.

'Do they have providers sitting in those meetings?'

LaMaina wanted to know why the Deserts Grant rules were structured in ways that were inherently difficult for providers.

"My biggest qualms with that is do they have any providers sitting in those meetings when they're deciding on how we should utilize this funding?" said LaMaina.

I spent about a month trying to talk to someone from the state Office of Child and Family Services about the grant, and I submitted a number of written questions. Eventually I received written statements, which said that OCFS "worked closely with each program by providing technical assistance, extensive resources, and training materials to all providers who sought help."

That's directly contradictory to what every provider and CCR&R director I spoke with said about their experience.

Inside one of the rooms at Tri-Town Kids in Brasher Falls.
Amy Feiereisel
Inside one of the rooms at Tri-Town Kids in Brasher Falls.

The greatest loss

The Deserts Grants program has expanded capacity. It has reimbursed hundreds of providers for start-up costs.

But for many, including McCarthy and LaMaina, it’s been demoralizing and even a financial drain.

And then there’s the potential providers, the ones who were pre-approved for a Deserts Grant, and never made it across the finish line. I spoke with one from western New York, a mid-twenties woman who has worked in child care for years and who applied for a Deserts Grant to open a center in her area. She asked that her name not be published as she still works in child care.

She was pre-approved for a grant, but wasn't able to open within the 120-day timeline. She said that was largely because of how difficult it was to get basic information and questions answered by OCFS.

"Even when we were awarded, there were still so many unknowns, and there was no one to ask," she said. She'd try calling OCFS, "and the state would say, you need to email the Deserts [Grant] people. So you email and it sits in the inbox for weeks. So then you tried calling and there was no one to call, there was no number."

She said the lack of information made it impossible to meet the 120-day deadline. She didn’t open her center. That was heartbreaking, she said, and it got worse when the only nearby child care center closed earlier this year.

"Forty-five families just lost their childcare," she said, in the same area that her center was supposed to open. "And I had 73 kids ready to go. The need is there!"

She said if OFCS didn’t intend to support new providers through the process, they shouldn’t have offered the Deserts Grant to them. Why not structure it as just for existing programs that wanted to expand? Why include centers when the 120-day timeline would be so hard to fulfill?

"It was not what it was advertised to be," she said. "And this could have been a program that really helped our communities and it did not. And instead it brought on insane levels of stress to people [child care providers] who we already know have entirely too high of burnout levels."