CITY CHILD CARE SYSTEM FACING GRAVE FISCAL RISKS DUE TO OUTSTANDING PAYMENTS OWED

WORKFORCE, SERVICES, CHILDREN AND FAMILIES NEGATIVELY IMPACTED

In June 2022 advocates, providers, and parents stood with Mayor Adams to applaud a multi-year $2 billion child care plan.

At the plan’s release Mayor Adams rightly noted its profound implications as child care services are not only essential to children’s social emotional growth and school readiness but also to parents’ peace of mind and their ability to connect and remain connected to employment. Critically, the Mayor also acknowledged that the sector relies heavily on a workforce of women of color across this city and that that workforce is valued.

Sadly, today the plan’s success and the fiscal stability of the entire sector is at grave risk. A full nine months into the Adams administration child care contracts may finally be registered but the City’s obligation to pay providers in a timely manner for services rendered remains a dire problem.

Center based child care providers are owed millions of dollars in reimbursements for services rendered during city fiscal year 2022 (July 1, 2021 – June 30, 2022).

Some providers are owed so many months reimbursement that they are now leveraging loans or credit lines to keep their programs operating, while others have not only missed employee payrolls, but health insurance coverage of their workers is now at risk, and others are contemplating returning their contracts to the city altogether and closing centers.

Without immediate action –the City’s child care plan will not only be left unrealized but more importantly, the early care and education sector, its workforce and the children and families that depend upon it, will be irreparably harmed.

The advocates, parents and service providers who stood with the Mayor and his team in June, are committed to a continued partnership. To ensure the City’s child care plan becomes reality and the City of New York can reach greater numbers of children with sorely needed high quality care, we urge the following immediate actions:

• Pay ALL providers their contract value for FY’22 by October 15, 2022
• Migrate invoicing and payment processes from DOE (Department of Education) PreK system to MOCS (Mayor s Office of Contract Services) Passport system
• Pay FY’23 invoices promptly assuring the ability for providers to bill for more than one month at time and that the lag between invoicing and reimbursement never exceeds 30 days
• Hold providers harmless from enrollment penalties as long as DOE controls enrollment.