Tennessee families could lose their childcare or be forced to pay more following expiration of federal funding

The emergency funding provided was part of the American Rescue Plan Act.
A childcare crisis in Tennessee is looming after the expiration expiration of federal emergency money.
Published: Oct. 2, 2023 at 4:57 PM CDT
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NASHVILLE, Tenn. (WSMV) - Federal childcare funds allocated during the pandemic expired at the end of September, and many Tennessee families may soon feel the financial hit.

The emergency funding was part of the American Rescue Plan Act that gave on average $193,800 to 2,550 Tennessee childcare centers, according to the U.S. Department of Health and Human Services.

Childcare for preschool parents like Laura Hamann is essential.

“Daycare, to us, is extremely important because we both have jobs,” said Hamann. Both she and her husband work, so their 4-year-old son, Paul, has been enrolled at Nashville’s Glen Leven Day School since he was an infant.

The school just raised tuition this past August by 8% to meet costs, but that number is about to take an even bigger jump of 12% to 15% because their federal pandemic emergency funds just expired.

For an infant at Glen Leven, that 15% increase translates to an additional $234 dollars a month.

“It really does break my heart because I don’t know if our parents can afford it, and these kids need care,” said Glen Leven Preschool Director Debbie Ferguson.

“I think it’s very possible that a lot of centers are going to have to close their doors and/or are going to have to turn those fees and charge parents to be able to make up for the money that’s been lost from these funds,” explained Ferguson.

Ferguson said they used funds to raise wages and offer bonuses, pay for higher quality training, make some security improvements and help pay for a much-needed new roof.

“Sometimes they’re with their teachers more than they are with us as parents. So, to have teachers that care about our kids that love on them like we do, it’s just so important to us as parents,” said Hamann.

Parents across the board agree that quality care for their most precious little blessings is critical, but will they still be able to pay for it?

Both Hamann and Ferguson said reality is about to hit many families.

“If you aren’t prepared and you can’t afford the increase, you need to start looking for childcare now because when that time comes, there’s not going to be anywhere else for you to go because there is a shortage in childcare,” said Hamann.

Ferguson explained it will be a wakeup call for many parents.

“You’re looking at parents who are going to have to make hard decisions about staying home with their children because childcare is not affordable, or there’s no childcare,” said Ferguson.

WSMV4 asked Tennessee Childcare and Community Services Assistant Commissioner Jude White what parents need to be doing now and how they can access resources to get help if their childcare center is affected by the expiration of federal funding.

Here is the commissioner’s response:

“Parents can ask their providers what strategies they have for financial sustainability. Parents can offer to connect providers with private businesses that may be interested in partnering to make child care available to their workers or who may want to sponsor some of the operational costs of the child care program like classroom or playground materials. DHS makes Small Business Academies available to providers at no cost. Small Business Academies promote best practices and offer strategies to strengthen business operations for child care agencies. Parents can ask providers if they know about this resource and if they have participated in this opportunity Child Care Incentives, Grants and Supports (tn.gov). They can also ask if the providers know about the resources like enhancement grants and the WAGE$ program, which are available to programs licensed by DHS. Parents looking for other child care options can use our online tool Find Child Care (tn.gov).”