New rules in Ohio could close some child care businesses

Operators have 2020 deadline for meeting state’s tougher standards.

More than two-thirds of the providers in southwest Ohio who serve families with publicly funded child care are at risk of losing the ability to accept state funds when new rules go into effect in 18 months, a Dayton Daily News investigation found.

The new rules and rating system were aimed at exposing more children to enrichment programs and educational offerings, with an eye toward improving kindergarten readiness. On a five-star rating scale, providers will be required to earn at least one star by July 2020 to receive per-child funding from the state, and three stars by 2025.

The Ohio Department of Job and Family Services last year released a study that found “there is evidence that sites with higher star ratings (3-star or higher) are associated with better child outcomes.”

But the rules could have a host of unintended consequences, the Daily News investigation found.

The newspaper interviewed providers with decades of experience who are considering changing careers, citing the difficulty of meeting the requirements.

Parents of thousands of children could be forced to find new providers — and fight to get one of the available slots in rated centers, experts say.

And some parents could be forced to drop out of the workforce entirely if they can’t afford to pay for child care out of pocket.

“We’re hitting a crisis point,” said Lisa Babb, strategic operations director of 4C for Children, which is tasked by the state with helping the region’s publicly funded child care centers meet the new requirement.

The new rules go into effect on July 1, 2020. At that point, any child care agency that does not have a star rating under Ohio’s Step Up to Quality program will no longer be able to bill the state.

This could impact thousands of children across the region. Of the 1,513 centers receiving subsidized child care across southwest Ohio, more than 1,000 are unrated, and thus do not meet the 2020 requirement.

The number of children in those programs — 18,303 — is more than half the children in publicly funded child care in the region.

Big hurdles

Ohio allocates more than $630 million per year to subsidized child care ($400 million of it federal pass-through money), which helps fund centers that serve more than 100,000 Ohio children. The voucher system subsidizes care based on a sliding scale, with higher-income families paying a greater share of the cost.

Child care industry advocates have been pushing for the state to raise its reimbursement rate, saying it does not cover the true cost of providing care. That, coupled with the burden of meeting the new requirements, could force more operators out of the business.

“We know there are going to be centers that have contracts that have no intention to get rated because they have one or two children … and it’s just not worth it for them,” Babb said. “They don’t want to jump through the hoops.”

Small, home-based centers that serve only a handful of kids have the biggest hurdles to climb. Of Montgomery County’s 82 Type B centers — those serving no more than six children – just 12 currently meet the rating requirement, or 15 percent, according to the Daily News investigation. Only 24 percent of Butler County Type B homes are rated, and 17 percent of those in Clark County.

Montgomery County has 274 child care centers accepting kids under publicly funded child care. This includes churches and centers like YMCA programs, as well as in-home daycare businesses. Only 108, or 39 percent, are rated. Unrated programs serve 3,585 children.

In Butler County 1,229 children are currently in unrated programs. In Clark County, the number is 379.

Small counties face a particular challenge. Of the 12 centers in Champaign County, only two are rated. Of 15 in Miami County, only three are rated.

“And they are are so spread out … if a couple centers close or programs close, the impact it’s going to have on those families, and on the workforce out there is huge,” Babb said.

‘I expect to change careers’

Some operators told the Daily News they will close down over the rule change. Melissa Boswell has been running a small daycare out of her Springfield home for 28 years. But she doesn’t have a high school diploma, she said, which is one of the requirements under the new standards.

“I expect to change careers,” she said. “I have a hard time going back to school to do something I’ve been doing for 28 years. if I’m going to have to go back to school, maybe it’ll be for something different.”

Boswell currently has five children in her care, most of whom are on vouchers.

She said she knows of several other women exiting the program for the same reason. She believes the educational standards should apply to new employees, but professionals like her should be grandfathered in.

“We’ve got years of experience,” she said. “A high school diploma at this point is not going to change anything for us.”

The biggest obstacle for operators is meeting the rating system’s requirement that administrators and a percentage of teachers have post-secondary certifications such as a Child Development Associate, Babb said.

“The person that needs to go through these steps (the facility administrator) … they’re in the infant room one day, then they’re driving a bus the next day, and they’re being stretched so many different directions,” Babb said.

Some administrators held off on meeting the certification requirements, hoping state lawmakers would amend or eliminate the requirement, according to Babb. But that doesn’t appear likely. Governor-elect Mike DeWine campaigned on expanding eligibility to the program, but leaders of his incoming administration say they are not looking to change the rating system and instead will work to make sure providers meet the deadlines and stay open.

Tiffany Spicer, administrator of Hickory Dickory Tots, in West Chester Twp., said only about 19 percent of her center’s 200 children are on state-funded vouchers. Although she is not sure it is worth the extra administrative work to go for more stars by 2025, she said she would go through the process “just to keep those children.

“They deserve anything and everything a private-pay family will get,” she said.

Seeking better outcomes

The rating system has existed since 2012, when lawmakers tied it to a major education reform bill, Senate Bill 314.

Concerned some operators were doing little more than babysitting, lawmakers sought to ensure that children were being exposed to enrichment programs.

“It makes sense that if we’re going to be giving this much of our tax dollars, we should have some sort of a requirement that the children are not going to be put in front of a TV,” Babb said.

The state also wanted to address a problem that continues to trouble educators: getting enough kids ready for kindergarten.

Data assembled by University of Dayton Professor Richard Stock shows only about 38 percent of Montgomery County children are fully ready for kindergarten when they start.

“(The rating system) takes child care beyond basic health and safety licensing requirements, where it used to be, and puts the emphasis into things that we know build a strong educational program — like the education requirements of the teacher, and the curriculum, and assessments and communication with parents,” said Robyn Lightcap, executive director of Preschool Promise, which works to improve early childhood education in Montgomery County.

But Lightcap said the rating system is based on establishing quality processes and not on children’s actual outcomes, such as readiness for kindergarten or future school success. As more centers are forced to meet the state’s requirements for providing care under the state program, advocates and others will be looking to see if the changes have moved the needle on those outcomes, Lightcap said.

‘Show me proof’

Many child care centers do a terrific job putting kids on a successful path. On a recent morning, children at Good Shepherd Academy Child Care in Miamisburg were engaged in a range of educational endeavors under the supervision of center manager Eartha DeWalt.

Four children took turns writing math problems and each other’s names on a marker board. Younger children played with blocks in one room or sang songs as they moved between classrooms. The activity room was noticeably quiet as children were at work on supervised activities.

Good Shepherd serves 39 children from infant-age to school-age, with a mix of private-pay families and those on publicly funded child care subsidies. It is rated with two stars.

Director Palmer Jason said much of the star-rating process is not purely “how good is your center,” but rather, “did you do the work to document your procedures?” He said it took six to eight months of preparation for the assessment and inspection, adding that the 4C for Children agency was a huge help in that process.

Jason said he had to document the frequency of informal conferences with parents, save copies of newsletters and family reports sent home, file copies of text message exchanges with parents and more.

“All of those are things that we were already doing to communicate, but then the state comes in and says, show me proof,” said Jason. “It’s a huge commitment in terms of time and resources.”

Jason said he has never had parents ask about Good Shepherd’s rating status.

“When we hung our 2-star banner, our parents said, ‘Oh that’s great,’” he said. “But every parent has their own definition of quality, and if their personal definition is being met, they’re happy.”

State: Goal within reach

The Ohio Department of Job and Family Services, which administers the Step Up To Quality program, downplayed concerns of a crisis, saying 52 percent of the state’s children in state-funded child care centers are in rated programs now.

“In other words, statewide statistics show that providers are well on their way toward reaching the 2020 goal with more than a year and a half to go,” ODJFS spokesman Bret Crowe said.

ODJFS is hosting Step Up To Quality fairs around the state, shifting child care licensing staff to helping programs get rated, committing $2 million in scholarships for child care teaching staff, and providing wage supplements to reward workers for getting training.

They are also contracting with regional agencies such as 4C for Children, which offers classes, coaching and other services free of charge. In addition, Babb is urging parents to get involved.

“We’re encouraging parents to ask your child care provider: ‘Do you have a one-star? Are you working toward becoming a quality-rated center so you can continue to care for my child who’s on a voucher?’” she said.

Babb said she is concerned about the impact on local families if too many operators fail to meet the standards set by the state.

“In 2020, if we have 300 centers or programs that shut down, where are those children going to go?” she said. “Unless they find some other program that has open spots for the ages of their children, they probably — with the level of income they’re at — they’re probably not going to be able to afford to private-pay and go to another child care center.”

Sliding scale

Ohio subsidizes child care for families based on a sliding scale. Here’s how it works:

A family of four that earns less than 100 percent of the federal poverty level, or $25,100, qualifies for free care for children from infancy to school age if the adult is working or going to school.

Families whose incomes are above that threshold can start the program if they earn up to 130 percent of the federal level — and stay in it up to 300 percent of the level — but the care won’t be fully subsidized.

Copays range from $35 per month for those just about the 100 percent threshold to $391 for those at the very top.

Five-star system

Step Up to Quality ranks centers from one to five stars. To continue receiving state funds, centers will have to earn at least one star by July 2020 and three stars by 2025. Currently, more than two-thirds of the providers in southwest Ohio that have at least one child receiving state-subsidized child care are unrated.

One-, two- and three-star programs must meet all standards at the lower levels before advancing to the next. Four- and five-star programs are awarded points based on their ability to earn additional points based on criteria that includes staff-to-child ratios, advanced training and family engagement.

A one-star rating means the center has a wage structure for employees, professional development plans, staff members who are certified Child Development Associates, an adopted curriculum and has met other requirements, such as providing assessments and resources for families. Documentation is required at each level.

Source: Ohio Department of Job and Family Services