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Child care could take a hit in government shutdown

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Child care shutdown
Gretchen Raymer supervises the playground at Creative Kids Academy, where she is the director. Subsidies to child care facilities like this one would be suspended, should a government shutdown ensue.
MPR Photo/ Sasha Aslanian

Some 26,000 Minnesota families received letters from the state earlier this month warning that their child care subsidies would be suspended in the event of a government shutdown. 

Child care advocates are challenging that decision in court today, arguing that child care subsidies are essential so low-wage parents can keep their jobs. 

Tiffany Woeste of Blaine, a single mother of two preschoolers, has been informed the state subsidy that pays for the boys' child care will stop if there's a shutdown. She doesn't have a backup plan. She said her only option is to try to come up with the money herself. 

"$560 is what I make every two weeks. My entire paycheck will go to daycare," Woeste said. 

Woeste works as a receptionist at a construction company. She just started her job in February so she doesn't have any paid vacation. Woeste said she doesn't have any family members or friends that could step in as a temporary fix. 

Her sons attend Creative Kids Academy, a privately-owned child care center in the Twin Cities suburb of Lexington.  

More than a third of the 72 children at the center are subsidized while their parents try to find  better paying jobs.  

Most of them have told center director Gretchen Raymer that they're going to have to pull their kids out of child care if they lose their subsidies. The daycare stands to lose $4000 a week, and they'd have to cut staff as the number of enrolled children drops.  

"We had to have some very hard conversations with these staff today. It's been a hard day," Raymer said. 

Raymer notified two full-time and two part-time employees  at the center that she has to let them go if there's a government shutdown.

Child care shutdown
Tiffany Woeste of Blaine is a single mother of two preschoolers, Evan, 4, left, and Austin, 3. The state subsidy that pays for the boys' child care will stop if there's a government shutdown. She doesn't have a backup plan and would have to come up with the money herself. "My entire paycheck will go to daycare," Woeste said.
MPR Photo/ Sasha Aslanian

Child care providers are already having a difficult time making ends meet in a down economy, with reimbursements that haven't kept pace with rising costs. 

Ann McCully, executive director of the non-profit Minnesota Childcare Resource and Referral Network, said losing the child care subsidies during a shutdown would further destabilize the low-wage field.

"No one is flush with cash, certainly not to make it through something like this if it continues very long at all," McCully said. 

She said that child care centers runs on a less than 1 percent profit margin, with the average hourly wage for family child care centers  averaging $4, according to a study several years ago. 

  McCully's group signed on to an amicus brief presented in Ramsey County Court today, arguing that child care subsidies are essential in order for parents to meet their work requirements for the Minnesota Family Investment Program, the state's welfare-to-work program. 

Another ripple from a shutdown could be the impact of state workers removing their kids from child care to save money while they are without paychecks.  

Allison Thrash, who works for the Minnesota Department of Health, called it a "no brainer" to try to save on daycare costs for her preschool son.

"We pay about $270 week for daycare," Thrash said. "So you know, if we're shutdown for two weeks, that's about half of my check right there that we could save." 

Arguments are likely to continue tomorrow in the  first court hearing on a shutdown that would start July 1. Child care advocates are just one of the many interest groups arguing to keep their funding flowing.