MISSOULA — The childcare industry has been held afloat through The American Rescue Plan Act money for the last three years, but as that funding comes to an end, the future of childcare businesses in Montana is held in the balance.
The United States government allocated $24 billion nationwide to stabilize childcare centers during the pandemic. While over $61 million of those funds were given to providers in Montana, the sum served merely as a bandaid fix to a larger problem.
"Even though the crisis of COVID has largely passed, the crisis for childcare was here before COVID and is still here going forward," Zero To Five strategic collaboration coordinator Grace Decker says.
Childcare has historically been an underpaid field, with current average wages reaching $12 per hour, which is not a livable wage in a city like Missoula.
“It's hard to retain the staff if I don't have the wages to pay for them. And, you know, the money that came from the grants really helped supplement that and helped us keep the wages up," Marmot Snetsinger, co-director of Little Twigs Child Care in Missoula says. "But as rents go up, as food goes up, you know, it becomes tighter and tighter and tighter. So without some additional assistance, it's really not a money-making business at all."
With inflation raising the cost of food, gas and materials, paying staff adequate wages becomes more and more difficult.
“Childcare providers are thrifty and they are creative, and they are used to doing a lot with a little,” Decker says. “Folks have already cut corners as far as they really can. And now, they're in a situation where they would have to cut corners on things that you just really can't, like rent or food or staff”
But as much as providers are struggling to stay afloat, so are parents.
The average cost of child care in Montana is $7,900 annually per child, and that cost can be even higher for infants. According to the Montana Department of Labor and Industry, 88% of Montana families can’t afford childcare.
The Best Beginnings Scholarship is a state-funded grant in Montana that helps low-income families afford childcare. The scholarship was signed into law during the 2023 Montana legislative session, and therefore will not be affected by the expiration of ARPA funding.
“Unfortunately, the Best Beginning Scholarship in Montana already didn't meet the true cost of providing care,” Decker says. “So child care providers were already operating with less resources than they needed to to pay their staff and run their programs. So it's great that the scholarship has been expanded, but it does not, it doesn't really solve the problem on the provider side.”
Caryn Ahlin has a three-year-old in childcare and pays $540 a month for three days a week. With another kid on the way, she’ll be forced to work at home with her baby rather than try to afford two kids in daycare.
“So I am nervous now to have another one and be at home with them too, but that's just what we have to do to be money-conscious,” she says.
With the pandemic relief funds, providers were able to pay their staff livable wages while keeping rates low for families.
BriAnne Moline runs the at-home child care center, Wild Wonders, and was able to secure $10,000 every three months from ARPA funding. She used the funds to incentivize staff with higher wages, paid time off and even holiday bonuses.
With her last check arriving in January, Moline is no longer able to provide the same benefits to her staff and has since lost all three employees.
She now runs Wild Wonders by herself and is doing everything she can to stay open, including taking on four part-time jobs to supplement her income.
After losing her staff, Moline reduced her capacity from 12 full-time children to four and ultimately had to raise rates for families.
“As educators, we are here to build a community for these families and to support them,” she says. “We acutely feel their financial distress, particularly in home-based settings such as this early child care facility. We become an extension of each other's families, so it is incredibly difficult to raise rates, knowing what a hardship that's going to be on essentially your family.”
Ahlin’s son, Noxon, attends Moline’s daycare. While she and her husband struggle to pay the monthly rates, Ahlin says she understands Moline's situation.
“I mean, I don't blame childcare. It's something that they have to adjust to and we as parents have to adjust to it as well,” she says. “It's nothing that I take personally because I know how it is with what's going on right now.”
Moline is not alone in her hesitation to raise rates. The struggle to stay open without putting financial stress on families exists in larger centers as well.
Marmot Snetsinger opened Little Twigs Child Care at 1806 South Avenue in January of 2020. She currently employs 22 staff members and cares for 60 children ages 0-to-6. Through ARPA, she received $60,000 every three months.
“The money that came from the grants really… helped us keep the wages up, and also helped keep the tuition down for parents,” Snetsinger says. “I want to be able to maintain paying my staff a livable wage, and I can only charge so much from the parents because they can't afford it either.”
Snetsinger hires mostly refugee and immigrant women to give them a stable career as they move into Missoula. She pays them $12 to $20 per hour.
“I do everything in my capability to keep the wages as high as I can for the childcare providers,” she says. “If you pay your staff well, then they're going to stay. And for children, it's really important that their caregivers stay consistent.”
September 30, 2023, marks the official expiration date for the pandemic relief funds, but Montana providers have long since known this day was coming. As media attention grew, centers hoped more permanent funding was in the works, according to Decker.
“So while the loss of federal funding may not be a surprise to folks, it is not the case that they've been able to prepare for this time to come,” she says. “Childcare as a business is not a business that has a lot of margin. The costs that people are experiencing have risen so extremely, while the regular income is not enough to match those increased costs. And there hasn't been a way for childcare providers to save against this day. So even though they've known that it's coming, I think there's been a sense of like, we'll figure it out when we get there. And here we are.”
As the funding disappears, Moline isn’t the only provider to reduce their services. She says she already knows of a few centers in Missoula closing their doors, while others have lost enough staff that their capacity has declined immensely.
The decreasing availability of child care in the wake of less funding, adds fire to an already dire situation. In Montana, the total licensed capacity meets only 44% of the estimated number of children in need of childcare, and that number is even lower for infants.
This number highlights licensed capacity numbers, so the real availability is even scarcer. For example, Fort Courage Child Care in Missoula is licensed for 106 children, but as of July, only held about 90 in order to stay compliant with staff-to-child ratios and prevent burnout.
“What's going to happen to these children when they don't have caring loving, high-quality environments to go into?” Moline asks. “What's going to happen to those families when they can't go to work because they don't have a stable childcare environment for their children? What's going to happen to those businesses? It is a trickle-down effect.”
Without legislative assistance, child care centers in Missoula are looking at other options for funding. Moline often writes applications for grants and scholarships. Snetsinger is looking to turn Little Twigs into a non-profit.
“What it costs to run a school is not something that you want to be charging to the families, it's way too high,” Kasey Davis, executive director at Missoula Community School, says. “So there's this gap between what families are paying and what we are paying out, so that's where my concern is moving forward is where we're going to find the money to fill that gap.”
Davis says Missoula Community School will look at public fundraising to maintain the quality learning environment that they have. She employs 21 staff members, who are paid a salary of $27,000-to-29,000 over 10 months.
“Hiring and being able to pay the wages that the people deserve and also that they can live off of in Missoula has been a real struggle,” she says.
Missoula Community School received a little over $173,000 total and used it to increase wages and reduce tuition for families.
The end of this funding has presented a “child care cliff,” as the last few years of federal stabilization ends abruptly, and providers are left on their own again.
Decker says while there may not be an immediate influx of center closures, the next few years will be crucial to finding long-term funding.
“I think we're at an inflection point where there are two pathways we could go down. One is that we continue to ignore what a problem it is, and we don't actually do anything about it. And in that instance, yes, more and more people will leave the childcare field, fewer and fewer people will see it as a viable way to make a living,” she says.
“But the other pathway is that businesses and government at all levels local, state and federal folks will actually begin to make those kinds of long-term and transformative investments that will recognize that the childcare, the Early Care and Education sector is critical for children and for families," Decker continued.
The solution for long-term childcare funding is not clear, but for Snetsinger and Moline, both whom have degrees in child development, greater respect and appreciation for their careers is a great start.
“People often perceive childcare workers as babysitters,” Snetsinger says. “But I have two master's degrees, and it challenges me every day. So this job of being a childcare provider is a critical job, it's a hard job, and it really deserves a lot of respect, and it deserves help from outside sources.”
The ARPA funding for child care in Montana was more than just the $61 million in stabilization grants for providers. In total, $110 million was allocated to the childcare sector. Other grants included $5.5 million to fund childcare for parents in the medical field, grants for family and friend child care and 30 grants for infrastructure improvement projects.
