Overbrook Little Learners CEO Rasheda Allen was ecstatic when she learned she had received a forgivable loan for her business.
Overbrook Little Learners is one of 54 child care centers in the Philadelphia area to receive financial support from the Pennsylvania 30 Day Fund, a nonprofit founded by Jeff Brown, Jeff Bartos, Richard Phillips and Roger Braunfeld in response to economic hardship caused by the coronavirus pandemic and civil unrest.
“We are immensely grateful to PA 30 Day Fund for the financial support during this time. Many other centers have been forced to close due to significant loss of private tuition, enrollment and healthy staffing; however, because of this forgivable loan, we don’t have to,” Allen said.
PA 30 Day Fund, which announced its child care support initiative on Nov. 24, aims to provide 1,000 forgivable loans, each in the amount of $3,000, to small businesses across Pennsylvania by Dec. 31.
Brown and Bartos, who are Jewish, said the fund has distributed 670 forgivable loans to businesses in nearly every Pennsylvania county. The additional 54 child care loans, which totaled $162,000, bring the number to 724.
Brown and Bartos decided to focus on supporting child care centers — specifically women and minority-owned child care centers — after learning about changes to state funding policies that would have a significant impact on these businesses. They reached out to Donna Cooper, executive director of Public Citizens for Children and Youth, for help in identifying child care centers with the greatest need.
“From March to Sept. 1, the state continued to pay child care centers as if kids were still enrolling at the full scale. And then as of Sept. 1, the state shifted it’s policy and started to only pay for the actual number of children attending, and once that happened, child care providers saw their revenues drop by 40 to 50%. And that means they’re letting go of staff and it also means they may need to close because the margins are too narrow to be able to support that,” said Cooper, who is Jewish.
Child care providers already faced several obstacles before these policy changes.
Mark Ornstein, president and CEO of Federation Early Learning Services, said these businesses are dealing with a great deal of risk during the pandemic.
“Managing that risk while also balancing the quality of care that our families expect from Federation Early Learning Services is a difficult yet necessary endeavor. Myself and each member of FELS’ staff understands the important role we play in helping families, particularly essential workers battling the pandemic, to get back to work by caring for their young children,” he said in an email statement.
The fund founders knew that child care centers are crucial to essential worker parents, as well as parents hoping to return to work when the pandemic ends.
“There’s a vaccine on the horizon, and people are going to, at some point, get the vaccine and want to go back to work,” Brown said. “How are they going to go back to work if all the early childhood organizations are not in business?”
Cooper said PCCY had already partnered with Reinvestment Fund to provide financial advising and grants to child care programs. The two organizations had infrastructure in place to identify high-quality early childhood programs in Philadelphia that needed temporary financial support.
The organization uses a ratings system developed by the commonwealth of Pennsylvania, which assigns value to child care centers based on the quality of curriculum and staff, and PA 30 Day Fund used the information when evaluating applications.
Allen said that the money would help cover the costs of increased safety precautions and reduced enrollment.
“A lot of parents who are not working no longer qualify for subsidized child care. And because they do not qualify, those funds are no longer available for them. So our business went from a fully enrolled program to maybe 25% of its enrollment,” she said.
The cost of providing masks for children and parents, signs to indicate social distancing and safety precautions — as well as personal protective equipment like goggles, gloves and hand sanitizers for staff — adds up for small businesses operating on reduced budgets. Allen also reported that she had seen a lot of price gouging while buying supplies.
Bartos said he was amazed at the resilience of child care center owners in the face of the challenges, and noted that almost all of the loan recipients were women.
“These women business owners are just so full of joy and hope and commitment to what they do, and they pour everything they have into their work,” he said.
Cooper and her colleagues hope that the state will find a way to continue to compensate for depressed demand.
“It’s taken us 20 years to build up a robust supply of early childhood programs, and we can’t lose them,” she said.