Angie Newsome/Carolina Public Press

DHHS: Continuing subsidies a ‘county-by-county decision’

The October federal government shutdown was very close to impacting a program that offers lower-income working parents assistance in paying for child care. As parents faced an increase in child-care costs, many area child-care centers also faced big changes. With many area centers enrolling a high ratio of families using the subsidized child-care program, the loss of those subsidies could have forced some to close.

If a family meets the eligibility criteria, the government pays a portion of the cost of child care, based on family income and size. Funding for subsidized child care comes from three sources: the federal Child Care Development Fund, the federal Temporary Assistance for Needy Families fund and some state funding.

In the 18 counties of Western North Carolina, 6,165 children currently receive subsidized child-care services.

Julie Henry, a spokeswoman for the N.C. Department of Health and Human Services, said that when it became apparent that, in addition losing federal funds, the state would exhaust its funds for subsidized childcare by the end of the month, letters were mailed statewide on Oct. 14 notifying county commissioners of the situation.

“With no additional federal funds coming in, we made the decision to make a priority of funding child care for children whose parents are on welfare and who are in child protective services through December,” Henry said, referring to the federal shutdown that lasted from Oct. 1 to Oct. 17.

States are reimbursed after services are provided, Henry explained. Every county is given an allocation each month, based on reports provided to each county’s department of social services.

Continued operation of child-care and early education programs is a county-by-county decision, Henry said. If no more money had been available from the state, each county board of commissioners would have to determine if there are any local funds available to help keep the centers open.

Shutdown an eye opener

Just days before the shutdown got a temporary reprieve, 36 North Carolina counties notified the Department of Health and Human Services of plans to suspend subsidized child-care services. Seven of those counties indeed suspended services, including Swain County.

But before any more centers closed, Congress passed the Continuing Appropriations Act, 2014, ending the government shutdown, funding the government through Jan. 15 and raising the national debt limit until Feb. 7, 2014. Read how North Carolina’s delegation voted on the measure here.

“DHHS had notified counties of the total amount of state funding remaining for subsidies for this fiscal year 2013-14. With the end of the federal shutdown, we sent counties their fully restored annual allocations on Oct. 17 and we anticipate that subsidy payments to counties will be restored to a mix of federal and state funding,” said Kirsti Clifford, a Department of Health and Human Services press assistant.

The two-week shutdown was an eye opener for area child-care leaders.

When Sheila Hoyle, executive director of the Southwestern Child Development Commission, realized that McDowell County child-care centers were running out of federal funds, she notified parents that as of Oct. 17 they would have to pay the amount that had been subsidized or take their child out of the program.

“We hope this will be a very temporary circumstance. In the event that the federal shutdown is ended, you will receive another notice … when funds are available again. At that time your services can be restored with your child-care center. In the meantime, you should discuss with your child-care center other payment options or discuss arrangements for holding your child’s space at this center, if you want your child to return to child care when funding is reinstated. We recognize that this situation is a tragic loss of service for young families who need child-care services,” Hoyle wrote.

McDowell County commissioners intervened, voting unanimously to cover daycare voucher funding with county funds. That would have totaled about $130,000 a month to pay for the 432 children in daycare whose parents qualify for the subsidies.

But, had the shutdown continued, other programs may not have been as fortunate, said Vickie Ansley, deputy director of programs for the Southwestern Child Development Commission.

Some centers in Swain County, for example, were already losing some children from their care when parents could not afford to pay the subsidy amount themselves.

“If parents can’t pay the full fee and county commissioners or other agencies can’t step up to make up the difference, the worst case scenario would be those children would be removed from the programs and mothers would have to give up their jobs to take care of their children,” Ansley said.

North Carolina has one of the highest rates of working mothers with young children, compared to the national average, according to the N.C. Division of Child Development and Early Education, a division of the N.C. Department of Health and Human Services.

And child care wasn’t the only issue. So was food for the centers.

In addition to the loss of federal subsidies, many child-care facilities receive free or donated food, which was impacted as well because of the temporary closure of the federal Child and Adult Care Food Program. That program not only provides meals and snacks to children in child-care centers and after-school programs, but also provides meals for men and women in in Adult Day Care programs.

Derick and Krystal Pendergrass, of Franklin, have five children. Two receive subsidies for their child care. Both parents have jobs to be able to support their large family, but Krystal said she would have had no choice but to give up her job.

“I could not pay the full amount for child care for two,” she said. “It would be over $1,000 a month.”

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Peggy Manning is a contributing reporter for Carolina Public Press. Contact her at

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