To provide the urgently-needed financial support to the child care sector, the U.S. House Committee on Appropriations has recently passed the Child Care is Essential Act, which is providing a $50 billion Child Care Stabilization Fund to support the child care sector and enable providers to safely reopen and operate.

In this post, we will shed light on the following topics:

  • What is the Child Care is Essential Act?
  • What is the Child Care Stabilization Fund?
  • Are you eligible for funding?
  • How to apply?

What is the Child Care is Essential Act?

For parents to return to work and help stabilize the economy, families need a place for their children to go while parents are working. The COVID-19 pandemic has made it challenging for childcare providers to continue operating. Razor-thin margins, reduced capacity, lower teacher/student ratios, new safety procedures  mean that providers will likely find it even more challenging to survive as the pandemic continues.

To help providers get through the crisis, the House has passed the Child Care is Essential Act. This has created a $50 billion Child Care Stabilization Fund. The fund will help childcare operators with funding to help support them during these trying times.

What is the Child Care Stabilization Fund?

Within the already-established Child Care and Development Block Grant, a new $50 billion Child Care Stabilization Fund has been created, which will remain available until September 30, 2021.

What Does the Fund Cover?

Funding can be used to support the following operating costs:

  • Personnel costs, including premium pay, employee benefits, and employee salaries.
  • Sanitization and cleaning, personal protective equipment, and other necessary equipment.
  • Training and professional development related to health and safety practices.
  • Fixed costs, including mortgage obligations, rent, utilities, and insurance.
  • Mental health supports for children and employees.
  • Modifications to childcare services as a result of the COVID-19 pandemic.
  • Other goods and services necessary to maintain or resume operation of the childcare program, or to maintain the viability of the child care provider.

Calculating Funding

How much funding you will receive is determined by the state’s lead agency and will be based on a number of factors:

  • Your average operating expenses in the 6 months preceding March 1, 2020
  • Increased costs such as employee benefits and compensation, sanitization, group size limits and social distancing will also be factored in.
  • Funds will be adjusted for payments or reimbursements made to carry out the Child Care and Development Block Grant Act of 1990 or the Head Start Act, as well as the Paycheck Protection Program.

Are You Eligible for Funding?

Eligible Types of Child Care Providers

Grants are being provided to providers in the United States that are:

  • Childcare centers
  • Home-based childcare providers
  • Family childcare homes

Businesses of these types must also:

  • Have been providing childcare services on or before March 1, 2020.
  • Be either open and available to provide child care services, or closed due to COVID-19.

Priority will be given to businesses who prior to or on March 1, 2020, met any of the following:

  • Provided childcare during non-traditional hours.
  • Served dual language learners, children with disabilities, homeless children, children in foster care, children from low-income families, or infants and toddlers.
  • Served a high proportion of children whose families received subsidies under the Child Care and Development Block Grant of 1990.
  • Operated in communities with a low supply of childcare.

Payroll Requirements

Providers are required to

  • keep their staff on payroll
  • provide the same compensation they were getting before COVID-19.

If a provider wishes, funding can be used to provide premium pay to staff to reflect the additional requirements being asked of them during these times.

Improved Safety

  • Open centers: Must meet health and safety guidance from the Center for Disease Control and Prevention, as well as state and local authorities.
  • Closed centers:Will implement guidance from the Center for Disease Control and Prevention, as well as state and local authorities, once they reopen.

Stabilization grant funds can be used to purchase equipment and make modifications necessary to meet the guidance listed above.

How to Apply

  • Funding is administered by each state’s lead agency.
  • Each lead agency will make applications available on their website within 30 days after they have received grant funds.
  • Check your local agency website regularly or contact them to see when they will be ready to accept applications so you can get funding as soon as possible!