Second Round of Payments to Child Care Providers to Come in Early 2022

State school officials said they are planning to release another round of American Rescue Plan funding to child care providers early next year.

Child care providers have received $158 million in direct payments from ARPA funds and the Maryland State Department of Education is holding, but has not yet disbursed, $138 million of direct payments to child care providers.

Justin Dayhoff, assistant superintendent of financial planning operations and strategy for MSDE, told the Joint Committee on Children, Youth and Families on Thursday that MSDE plans to release grants for the second round of direct payments early next year.

“Our goal overall is to…get this into the hands of providers as soon as possible,” Dayhoff said. He added that MSDE has been reviewing feedback from child care providers to make the grant application process easier.

Including the grant application and processing time, child care providers will most likely receive that direct payment from MSDE next spring, said Christina Peusch, executive director of Maryland State Childcare Association.

It is critical for child care providers — many of whom have struggled to stay open during the work disruptions and uncertainties of the COVID-19 pandemic — to know how much they could be eligible for and when they would receive the grant from this second round of ARPA funding, Peusch said.

“If people know what they’re going to get and when they’re going to get it, they might think they can stay open a little longer,” she said. “They are called rescue stabilization funds for a reason.”

MSDE distributed the first round of payments to child care providers in the fall, but their advocates took issue with the slow distribution. Child care providers were told that they would receive their funds by Sept. 30, but were told only two days before that they would not receive funds by that date, according to Peusch.

Out of 7,200 child care providers in the state, 5,757 providers applied for ARPA funds and 90% of applicants received funding, according to MSDE.

MSDE said in a statement that they respect the child care community and expedited the grant application and approval process, highlighting that Maryland was one of the first states to distribute funds.

Scholarship fund confusion

In a November committee hearing, child care advocates told of confusion about and payment delays from the state’s Child Care Scholarship Program — which provides low-income families with financial assistance. Parents and child care providers who have called the program office have had a hard time reaching a person to help them with the application, they said.

Only thirty percent of parents who applied to the scholarship programs in September got that financial aid, according to Steven Hicks, MSDE’s assistant state superintendent for early childhood. Among the most common reasons for denying an application was missing documents, such as proof of identity and income, he said.

Through focus groups and webinars, MSDE will look into why parents are having trouble with their applications and why some parents are being denied, Hicks said. Starting in February, parents will be able to interact directly with someone at Maryland’s regional Child Care Resource Centers for assistance with their application, he said.

Child care providers are supposed to get payments from the child care scholarship program within 7-10 business days, but Del. Jared Solomon (D-Montgomery) said, from what he has heard from providers about how these payments are processed, there is a “disconnect” between what providers reported and how MSDE has said the payments are processed.

Hicks said MSDE is going to better analyze the data to figure out why some providers are not receiving payments in a timely manner. The goal is to get more providers to accept child care scholarships so that more families have access to childcare, he said.

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