Already precarious before the pandemic, child care in Salem is becoming less available and more expensive

Meghan Casto, 33, is expecting her first child in October and planning to return to work in early 2021. A day care spot she thought was secure before the pandemic may not materialize, forcing the family to consider a much more expensive nanny (Amanda Loman/Salem Reporter)

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Meghan Casto had already staked a spot on a Salem day care waitlist by the time she was eight weeks pregnant.

The 33-year-old is expecting her first child in October and planned to take a few months off from her job as a medical physicist before returning to work in January or February.

Coordinators at the Salem Child Development Center told her to call monthly to check her spot on the list. Casto said everything was lining up until the pandemic emerged in Salem. Suddenly, no one could tell her if or when her daughter might have child care as she had been expecting for months.

“I got kind of uncertain updates during that stage when everything was closing down,” she said. “Then it became negative updates.”

When she called in June, workers told her it might be a year before they’d have space. The fact that she and her husband are both health care workers who can’t stay home didn’t matter – the center was full.

“It was pretty disappointing and a little bit scary,” she said. The couple is now considering hiring a nanny until a day care spot opens up – an expense they hadn’t planned for.

As more Salem parents return to in-person work or seek care for kids who would normally be in school, they’re facing a child care industry that’s been upended.

Some providers have closed their doors since March restrictions hit, unable to make ends meet after state regulations limited the number of children they could care for.

Others are raising prices to offset the financial turmoil of the past five months.

Oregon was already known as a “child care desert” before the pandemic because low vacancy rates and long waitlists had become the norm across the state.

Now, providers say a mix of reduced capacity, stricter health regulations, uncertainty, and day cares and preschools closing their doors will make care less accessible and less affordable.

“More children need care now than ever and I’m worried that we’re not going to have the ample supply,” said Lisa Harnisch, executive director of Marion Polk Early Learning Hub.

In March, Gov. Kate Brown said child care providers must get state authorization to provide emergency care to essential workers or close. Hundreds of facilities around Oregon shut down and have yet to reopen.

Those that stayed open had to keep children in groups of 10 or fewer, slashing revenue for many as staffing costs stayed the same, and the cost of cleaning supplies and gloves rose.

“We had to reduce our enrollment by more than half,” said Carolin VanOrden, executive director of Salem Child Development Center, one of the largest child care providers in Salem.

The center was on more stable financial footing than many providers before the pandemic hit, VanOrden said, and they’ve been able to use expanded unemployment programs and other aid to cover losses.

Still, the nonprofit organization relies on tuition for nearly all its revenue, and operated at a significant loss from June through August, VanOrden said.

“It is really thin margins. Paying an employee in child care a living wage but at the same time keeping child care affordable for families is always a balance. None of us want to out price our families,” she said.

With most students absent during the COVID-19 pandemic, children get extra outdoor time at the Oregon Child Development Coalition’s North Lancaster preschool on March 20, 2020 (Rachel Alexander/Salem Reporter)

The center is among the providers raising prices slightly, a trend VanOrden said she’s seen across the industry. As of Sept. 1, one month of care for a child under 2 runs $826 at Salem Child Development Center.

In Oregon, families could expect to pay on average $1,000 for a month of full-time care for an infant in a home day care, up to $1,211 for care in a center according to a 2018 study from Oregon State University’s Child Care Research Partnership. Oregon’s Department of Human Services offers subsidies for working low-income families, but child care affordability remains a significant concern for both parents and providers.

Last August, Oregon had about 3,800 licensed child care providers, ranging from in-home operations with five children to large centers run by nonprofit organizations.

Now, there are just 2,800 operating under emergency licenses, Early Learning Division spokeswoman Melanie Mesaros said. She said the division doesn’t have data on how many lost spots in child care that represents, but vacancy rates for care are low, especially for infants and toddlers.

Currently, more than 97% of infant day care spots are full in both Marion and Polk counties, according to the division’s data. Just 88 spots are available in all of Marion County, and 24 in Polk. With significant variation in location, type of care, schedule and cost, there’s no guarantee that a family seeking care will find a good match among a few dozen available.

Some 3,600 child care providers are still licensed statewide, Mesaros said, so it’s difficult to know how many have closed permanently.

The division has given out $13 million to child care providers over two rounds of grants this summer, with another $25 million to be distributed by the end of the year, Mesaros said.

Those grants gave small in-home day cares $2,880 and larger in-home providers $5,400. Centers like Salem Child Development Center could receive up to $6,000 per classroom for up to three rooms.

The state also helped providers get personal protective equipment when items like sanitizer were in short supply.

Miriam Calderon, the early learning division director, said that money falls far short of the lost revenue, which OSU researchers estimated at about $80 million for two months statewide.

“This emergency has exposed what we knew before – the child care system can’t survive based only on what parents can afford to pay. As resources become available, we are committed to putting them in the hands of child care businesses. Given the uncertainty of how long this emergency will last, we must also think about a longer-term strategy to ensure our state has a durable and sustainable solution for child care,” Calderon said in an email.

Providers said while the state aid they received was helpful, it wasn’t enough to cover shortfalls over the summer.

Lena Perez, who owns day care and preschool Priceless Treasures in Salem, said child care has received little help from policymakers aside from quickly-spent grant funds.

“The parents and the providers are the ones having to pick up these pieces,” she said.

They also found themselves competing with free child care suddenly offered in local schools and community centers – a short-term effort that helped parents, but made it harder for small day care centers operating at a loss to earn badly-needed revenue.

“How can we compete with that? Because they can do it for a lot less,” said Rachael Lamet, a registered child care provider who operates a day care out of her Salem home.

Erin Banuelos, director of Kid Central in Monmouth, said they business closed in March, expecting coronavirus shutdowns to be short-lived. The center is a non-profit and Banuelos looked for aid programs to help cover overhead expenses while they were closed.

“I started applying to everything,” Banuelos said.

She missed an initial deadline for a federal paycheck protection loan, but was eventually approved. That money was intended to cover two months of payroll costs, but Banuelos said it’s based on an average of costs that didn’t take into account Kid Central’s growth before the pandemic. The money paid about a month of payroll.

When it became clear schools wouldn’t be reopening for months, they sought an emergency license to re-open, and began taking families back July 1, operating three classrooms instead of the usual four. Come September, she said they’ll be back at full capacity.

Kid Central survived in part because they operate in a church and don’t have to pay rent. Banuelos said she other care providers haven’t been so lucky.

“If we had been a center that had to pay rent, we wouldn’t have survived,” she said.

Lamet, who usually has six to 10 children in her care, said the emergency closure in March shuttered her business overnight as she and families figured out what the rules meant.

“Literally that day my enrollment went to zero,” she said.

Before the pandemic, the business brought in about $4,000 per month, she said. After self-employment taxes, it’s enough to pay the mortgage and one part-time employee, but not a significant source of income for her family.

It took about four months for her to recruit families back in after the closure, in part because she was competing with free care at schools.

Lament said a $2,000 grant from the state helped a bit, she said, but was far less than she would have earned operating normally.

Now, Lamet said she’s worried about new state guidelines that go into effect Sept. 1. They allow some providers to have up to 20 kids in care, though she only has space for 10 in her home.

But they also require more regular cleaning and disinfecting, rules she said goes beyond what’s necessary to ensure safety for kids.

In March, state guidelines for emergency child care required more cleaning and sanitizing than normal, including disinfecting frequently touched surfaces “throughout the day” and sanitizing all toys at the end of each day.

Available data suggests those guidelines have been effective – of nearly 3,000 facilities operating over the summer, only three child care facilities had Covid outbreaks of five or more cases, according to data published by Oregon Health Authority.

Fifty-nine voluntarily reported at least one Covid case to the Early Learning Division – about 2% of facilities.

Lament said the latest guidelines are too onerous for small providers like her. One rule mandates a new, clean outer layer of clothing every time a worker feeds an infant. Another requires disinfecting sinks each time they’re used.

“I’m getting up at 5 o’clock in the morning and working until 9 o’clock at night just cleaning,” she said. “It’s almost to the point where it’s not worth it.”

Harnisch, the Early Learning Hub director, said she appreciated the new guidelines allowing more children in groups and is hopeful that will make the business more viable for some smaller providers.

She said she’s hearing more discussion in economic recovery conversations about the importance of child care.

“It’s highlighted from a workforce and from a wage point of view how fragile this system is. Often child care’s not regarded highly as a profession and I think people are getting it,” she said.

But uncertainty remains for parents and providers alike. Perez said with the increased group size, Priceless Treasures can return to near regular capacity of about 58 kids starting in September.

But its waitlist has grown significantly.

“We’re getting tons of calls. We have tons of people on our list. We just don’t have room for them,” she said.

Casto, meantime, is searching for a spot that would be available before next summer.

“I’m really hopeful that things will get better,” Casto said. “It’s just such uncertain times.”

Contact reporter Rachel Alexander: [email protected] or 503-575-1241.

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