NJ child care center costs spike due to COVID-19, study says

NEW BRUNSWICK — The added expense of COVID-19 protocols have brought New Jersey child care providers to a near breaking point, according to research out of Rutgers University.

A report by the Infant and Toddler Policy Research Center at the National Institute for Early Education Research, estimates that current COVID-19 safety measures and class size limits have increased child care provider costs by up to $69 a week per toddler and $37 a week per preschooler.

“Many child care providers were already struggling to turn a profit before the pandemic, so it shouldn’t surprise anyone if some are now forced to raise rates, turn children away, or close their doors,” according to Karin Garver, NIEER early childhood education policy specialist and the report’s author.

According to the report, a number of child care providers statewide remained open through the summertime peak of the pandemic in order to serve families of essential workers.

Expensive personal protective equipment, air circulation upgrades, more frequent cleaning and other procedural changes are among the greater expenses for centers since the spring in addition to more restrictive group sizes and child/staff ratios, Garver said.

With unchanged tuition rates, the new standards quickly push many child care providers from an already tight financial situation into one that cannot be sustained, according to the study.

The New Jersey Child Care Subsidy Program pays centers up to $241 a week for infants, $201 a week for toddlers and $167 a week for preschoolers.

With higher costs due to the pandemic, childcare programs are likely to lose money across all ages, the study found.

Among the study's findings is a recommendation that per child subsidy rates will need to increase by up to $40 per week for infants and $63 per week for preschoolers, the "breakeven rates" estimated in the study.

Garver did note that the state’s recent easing of pandemic capacity limits from 10 to 15 children per classroom at some older child care levels has provided some relief to providers.

As announced by Gov. Phil Murphy in late August, New Jersey has been providing supplemental payments of $75 a month per subsidy-eligible child from September through Dec. 30. The supplemental payments include infants, toddlers and school-age children.

State officials recently announced stabilization grants have been made available to the nearly 6,000 child care providers in New Jersey to support COVID-19-related costs such as purchasing PPE and other supplies and materials, cleaning and sanitation.

In a written statement released alongside the child care report, state Sen. M. Teresa Ruiz, D-Essex, said “current reimbursement rates fail to meet the cost per child, leaving providers with two choices, either raise the rates on parents who are not eligible for the subsidy or close their facility all together – both of which would be detrimental to the communities they serve."