The new year will not be a happy one for Teri Hendrix.
On Jan. 2, the Lexington single mother of two will lose the child care subsidy that has paid most of her child care costs for the past two years.
Hendrix, a payroll specialist for a fast food company, doesn't make enough to pay the $180 a week for child care for her two children.
"That's half my pay check," said Hendrix, who makes $10 an hour. Hendrix is one of thousands of parents in Kentucky who now make too much money to qualify for a subsidy for child care after stiffer income guidelines went into effect on July 1.
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Six months after the cuts took effect, approximately 13,674 low-income children have been cut from the program, according to data provided by the Cabinet for Health and Family Services, which oversees child care assistance. From April 1 to Nov. 27, 208 child care centers that accepted child care subsidies closed, according to the state.
Child advocates caution that those numbers will continue to climb as more kids are dropped from the program.
"Those devastating cuts have been bad for kids and families; bad for local economies; and, beginning to bad for the state budget," said Terry Brooks, executive director of Kentucky Youth Advocates, a Louisville nonprofit. "Hard working moms and dads have had to quit jobs to look after their children; kids have lost the opportunities that come from quality child care environments; local economies have lost jobs and discretionary spending; and the collateral costs to the state are beginning to take hold."
That is why 2014 is pivotal, Brooks said. Child care centers and early childhood education advocates want Gov. Steve Beshear and the state legislature to restore funding to child care subsidies and a program that provides a $300 subsidy to family members raising children who have been removed from their homes, called kinship care. The legislature is set to tackle the two-year budget beginning in January. But child care assistance is one of dozens of programs that have been slashed in recent years. The list of programs that need additional funding is long, Beshear's staff said.
"The commonwealth has sustained $1.6 billion in budget cuts over the past five years," said Kerri Richardson, a spokeswoman for Beshear. "Clearly, these difficult decisions were made after exhausting all available options, and some of those cuts have had real and damaging impact."
Richardson said that restoring the cuts to child care assistance programs is being considered by Beshear "but all budget items are still in flux at this time."
Feeling penalized for working
Cuts to the child care subsidy program were announced in January as a way to make up a projected $86 million shortfall at the cabinet. In April, no new low-income children were accepted into the program. In July, the maximum allowed income dropped from $33,075 for a family of four to $22,050 for a family of four. The cuts are continuing. Parents were notified at the time of their annual certification. The cuts will continue into 2014 as people are re-certified.
Hendrix was told at her annual review in December that her $400 a week job paid too much. She will be dropped from the program.
Hendrix is scrambling to find a higher-paying job before Jan. 2 so she can continue to work and her children can stay in the Community Action Center child care programs. But jobs aren't easy to find. She's worried that she will have to quit her job and go on welfare. That will hurt her pocketbook and her kids, ages 2 and 8.
"My two-year-old knows her alphabet," she said. "She can count to 10 in English and Spanish."
Hendrix doesn't want to go on public assistance.
"I feel like I'm being penalized for working," she said.
Christina Stopher of Louisville is in a similar situation. Stopher will lose her child care subsidy in January. Stopher, who has a 5-year-old and a 3-year-old, will have to spend 95 percent of her paycheck on childcare. Her kids go to Southside Christian Childcare in Louisville where she is an assistant director. Stopher is concerned that she will have to quit working to care for her kids.
"I'm trying to better myself and my kid's lives," Stopher said. "I can't exactly do that if I'm not working."
Carmen Woods, of Newport, had to quit her job as a deputy clerk in August after she was told that she made $40 too much to qualify for child care assistance under the new income guidelines.
Woods got custody of her two grandchildren in 2012. The childcare subsidy made it possible for her to take care of her grandchildren and keep them out of foster care. She never received the $300 per child monthly subsidy to family members who have custody of children removed from their homes. She doesn't know why she never received the subsidy.
"I have been employed for the past 20 years," she said. "If they would have even given me the kinship care money, I may have been able to keep working."
Woods was denied unemployment. She has tried unsuccessfully to find other jobs. If Woods was a foster parent, she said she would receive $1,700 a month to take care of her grandchildren. She tried to apply to be a foster parent. She can't be a foster parent to her own grandchildren, she was told.
Woods said she worries that cuts to both child care assistance and kinship care is making it more difficult for grandparents and family members to take custody of relatives.
Her only option is public assistance. But it's not much money.
"It's tough to live off of $225 a month," Woods said.
Seeing the losses
Woods' story is not unique. Child care providers say they have heard similar stories over the past six months as parents were cut from the program.
Approximately 208 centers that accepted the child care assistance subsidy have closed since the moratorium on new applicants and cuts to the program went into effect in April. State officials, however, caution that there is no way to know if the child care assistance cuts caused the centers to close. Child care centers close frequently for a variety of reasons, state officials said.
While some child care centers have closed, others are struggling.
Dan Lowe, owner of Big Blue Bird on Eastern Parkway in Lexington, has lost 40 kids due to the cuts in the child care subsidy. Approximately 78 percent of the kids at his center qualify for a free or reduced lunch, he said.
"I've seen people that I couldn't believe lose their subsidy," Lowe said. "How could they be making too much working in fast food?"
Lowe said most are single mothers.
"I had one woman who begged her boss not to give her a raise because she would lose her childcare benefits," Lowe said.
Lowe has not had to lay off any staff because of the drop in enrollment, but he will not receive a paycheck for December. He has one family that owes him more than $3,000 in back child care payments.
Community Action of Central Kentucky has had to close two of its child care centers over the past year because of a combination of state and federal cuts.
"Last year, we had 245 children that were served through the (child care subsidy)," said Malcolm Ratchford, executive director of the Community Action Council. "We now have about 161 students."
The number of children affected by the cuts changes daily, Ratchford said. Many parents have tried to pay for child care without the subsidy. Sometimes they can afford to pay it. Others can't and have to remove their kids. Many have to go on public assistance and stay home with their kids. That's costing the state a lot of money too, Ratchford said. "It's just a different pot of money."
"I think you'll see the economic impact much later in terms of children who are not in regulated child care," he said. "Then you have the hidden costs of people not being in the workforce, of not having these job skills."
Adrienne S. Bush, executive director of Hazard Perry County Community Ministries, Inc. said the center has lost about a dozen children to the child care assistance cuts. Ten to 15 children might not seem like a lot, Bush said, but the cuts make it very hard "to plan ahead and make sure we are doing our jobs getting these children ready for kindergarten, educating them, providing the best early childhood education that we can."
Bush said that they have had to put off some expenses so they can continue to keep the center going.
Diane Zwick, president of the board of the Ashland Child Development Center, has loaned the child development center money in recent months to keep the center going. The center moved into a new building recently so it could serve more children. Instead, it's enrollment has dropped by more than 20 kids since July because of the cuts to the child care assistance program.
That's a financial loss of between $9,000 and $12,000 a month. Staff hours have also been reduced, Zwick said. Four centers in counties close to the Ashland Childhood Development Center have closed in the past year, Zwick said.
The cuts are hurting centers. But it's hurting the kids that need early learning experiences the most, Zwick said. "A lot of our children that go on the subsidy program do not have as much opportunity to get a preschool education," Zwick said, who has a doctorate in education. "We see a huge differences in children who have had preschool education and those that don't. They don't know how to talk, they don't know how to make friends. They don't know how to answer a teacher's question."
Many child advocates say they were baffled that the program was cut when Beshear has championed early childhood education in Kentucky. The state recently received a $44 million Race to the Top federal grant to beef up preschool and early childhood education in Kentucky.
Brooks, of Kentucky Youth Advocates, said he was ecstatic about the federal grant money. But cautioned that it would not help if the child care and kinship care cuts are not restored.
"The cuts to child care and kinship care supports have to be the priority in the 2014 budget session before any new programs are added," Brooks said. "Without that kind of support, our race to the top for young children and families will become a sprint to the bottom."
Richardson said that Beshear is aware of the concerns about the cuts to the program.
"For those who have deep concerns about the challenges we face as a result of repeated cuts, it's time to help identify potential new revenue sources."
But even if money is returned to the program, it may be too late for people like Woods.
"I can't get my job back," Woods said.
Woods said she was trying to do the right thing by providing a stable home for her grandchildren. She feels like she's being punished for that decision.
"I don't know if I will ever vote again," Woods said. "I live within 500 feet of a polling place. Everyone wants to put their signs in my yard. That will never happen again."
To make up for an $86 million shortfall, the state implemented cost containment measures in the child care assistance program that effected only low-income kids. On April 1, no new applicants were allowed into the program. On July 1, income requirements were lowered to a maximum income of $33,075 for a family of four to $22,050, the lowest eligibility in the country.
The Kentucky child care assistance program provides subsidized child care to the following groups:
■ Children of low-income parents
■ Children who need child care due to a child protection issue
■ Children whose parents have to work as a condition of receiving welfare benefits
■ Children with special needs
Number of children cut from the child care assistance program
In 2012, the child care assistance program served a monthly average of 44,000 children. Of those served, approximately 34,600 qualified for the program based on income.
In Nov. 2013, the child care assistance program served a monthly average of 29,773 children. Of those served, 20,936 of those children were low-income.
The program has cut approximately 13,644 low-income children from the program
Source: Cabinet for Health and Family Services
Drop in Child Care Centers in Kentucky
As of April 1, 2013, there were 2,494 child care centers that received child care assistance subsidies.
As of Nov. 27, 2013, there were 2,286 child care centers that received child care assistance subsidies.
208 child care centers have closed since the freeze and cuts in assistance took effect. It's not possible to know if the centers closed because of the cuts or for other reasons.
There are 465 fewer child care centers in Kentucky in Sept. 2013 then in Sept. 2012
In Sept. 2012, there were 3,548 child care centers
In Sept. 2013, there were 3,083 child care centers
Source: Cabinet for Health and Family Services
*Not all child care centers in Kentucky accept child care subsidies.