After ARPA: Seeking New Revenue for Child Care

Early Childhood finance consultant and Exchange magazine author Karen Foster Jorgensen recently wrote to me: “With ARPA and other pandemic relief funding streams coming to an end, this is a crucial time for early childhood organizations to revisit their business models. During the pandemic, revenue, enrollment, and funding streams were interrupted from our normal ways of doing business with revenue at times very low and at other times very high, with funding to add new dimensions to programs and replenish furniture and supplies.”

The Hechinger Report notes as these funding sources are coming to an end, some states are looking for new revenue sources, including a constitutional amendment in New Mexico, and possible tax on sports betting in Tennessee, as well as proposed legislation to shift funds toward child care tax credits in Missouri and Minnesota.

Foster Jorgensen recommends programs develop their own rebuilding plans:

Now we head back into a period of financial management when cost analysis is key to rebuilding a financially sustainable business where revenue streams are in line to cover the costs to deliver quality for each program design and age-group of early care and education. While carefully planned and monitored expenses are crucial, building strong revenue streams may be our best action to strategically put our businesses into a place of financial strength moving forward.

The CAYL Institute is offering a free panel discussion on the topic at 4 pm ET on June 1: Leveraging Funding: Addressing the Fiscal Cliff

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