California budget battle continues over increasing the number of subsidized child care slots

Gov. Gavin Newsom and lawmakers are in the homestretch of hammering out a budget deal in which the fate of some 11,000 subsidized child care slots hangs in the balance.

In a tough budget year with the administration and lawmakers grappling with a $45 billion deficit, after years of increasing investments in child care for the Golden State’s low-wage earners, Newsom wants to hit pause for an indefinite period toward achieving an agreed-upon 200,000 subsidized child care slots by 2026.

The proposal would freeze the number of available slots at 119,000 and also claw back funding for some 11,000 additional slots already authorized, saving $1.4 billion over two years.

Lawmakers in their budget road map want to fund the slots for low-income families for which award letters have already been issued and instead are calling for a pause in authorizing the remainder of the new slots for two years.

The money is much needed to help parents who work long hours and whose schedules don’t coincide with child care centers and must turn to family providers for care, providers and union representatives contend.

“We want the Legislature and the governor to advocate for fair pay but also (to add) those slots because without those slots it’s very hard for workers to be paid,” said Yolanda Thomas, a child care provider in Contra Costa County and member of the Child Care Providers United negotiating team, the union representing 40,000 workers in child and family care.

The union ratified its first contract with the state in 2021.

“The budgets just keep on getting balanced on the backs of working families and if you look at it, providers are working families as well and we’re mirroring our parents,” said Thomas. “If we don’t get paid, we won’t be able to stay open, and in the end the parents are the ones that suffer.”

Dozens of California union representatives for child care providers and parents are expected to join lawmakers for a Tuesday evening candlelight vigil at the state Capitol to draw attention to fair pay for industry workers and to urge the Newsom administration and the Legislature to authorize additional subsidized child care slots.

Dueling arguments

Newsom noted during his budget revision presentation in May that “right now we don’t want to cut programs but we want to hold the line.”

The administration continues to work with the Legislature to reach an agreement regarding the continued expansion of state-subsidized child care slots, said H.D. Palmer, a Department of Finance spokesman on Monday.

Sen. Caroline Menjivar, D-San Fernando Valley, who is the chair of a budget subcommittee on health and human services among several other committee assignments, said the state made a commitment to reach 200,000 new subsidized child care slots.

“And in rejecting the indefinite pause we’re stating we are not going back on that promise,” the senator said in a statement. “Codifying the goal to 200,000 slots ensures no one can propose any future indefinite pauses.”

Tough decisions must be made as the state faces a serious deficit, she noted.

Still, “In this budget, it is imperative that we honor our commitment to fund the 11,038 child care slots we have already issued award letters for. Providers have already invested resources and committed to contracts in anticipation of the awarded money. Rescinding funding now impacts families, youth, and the system as a whole, including employers of child care agencies who are predominantly Black and brown women. Honoring award letters, that providers made infrastructure changes as a result of, is the just thing for us to do,” she said.

During his budget revision presentation, Newsom said he would say to families seeking child care slots that “we have more work to do” and that the state has been doing more.

“I mean, the idea that we had a 200,000 (goal), I remember we called it a stretch goal, a couple years ago. Then it was 100,000; then I said we’ll do (150,000) and then we went back, maybe we can achieve this 200,000,” Newsom said.

“So, I would tell them, our resolve remains firm but reality check” that the state would not take away the existing slots, the governor said. “We’re going to protect that.”

Child care deserts

Child care providers note that “all child care slots are not created equal” and some families find themselves in child care deserts, especially when in need of child care during non-traditional hours.

Subsidies vary by county with rates set at a percentage of what it costs a provider to give care. Families pay the difference for services if the subsidy does not fully cover what they get charged for care.

Providers like Thomas still take children if families cannot make up the difference. Five of her nine families currently receive a state subsidy for child care. The remaining four families are also in need and are on a waiting list, she said.

One such family with a special-needs child needs “wrap-around services” — more services than just child care — and the mom, a health-care worker, lost her job after the pandemic. The mom has found a job in another city where she is unable to find services for her child and relies on Thomas for long hours of child care.

“Every little bit helps,” Thomas said. “It’s a choice of not being able to work because you need child care or not working because you don’t have child care. It’s a double-edged sword.”

“This field is not glamorous,” Thomas added. “You have to take care of what really matters and for us as family home day care providers, we have to sustain financial deadlines (as well). We need the state to show up.”