Heidi McDonald, owner of Heidi’s House Child Care Center in Scarborough, has been in business for 32 years. But even though she reopened June 1 after shuttering in March at the start of the coronavirus pandemic, her financial problems continue to mount.

Costs to operate Heidi’s House have increased to comply with COVID-19 safety protocols, McDonald is dealing with a workforce shortage and the center is running at 60 percent capacity.

“Financially, it’s a killer,” said McDonald, whose day care center at full capacity serves 125 children. “If we make it, we will make it with $250,000 in debt.”

McDonald is far from alone. A survey completed by 656 of the 1,656 licensed child care programs in Maine released on Thursday paints a dire financial outlook for the industry.

“This is a scary time for this industry,” said Tara Williams, executive director of the Maine Association for the Education of Young Children advocacy group, which conducted the survey. “We were already talking about a child care crisis in Maine before COVID-19.”

Four out of five child cares in Maine have reopened, according to the Maine Department of Health and Human Services. But child cares are on average operating at 65 percent capacity, according to the survey, cutting into revenue. Reduced capacity and continued closures also worsen a shortage of child care in Maine, especially for infants, that existed before the pandemic.

Two-thirds of programs surveyed have lost money despite loans, stipends and grants from the federal and state governments.

Thirty percent of Maine child cares, according to the survey, have received a federal forgivable loan from the Paycheck Protection Program, a $660 billion federal effort that distributed loans to businesses representing many sectors of the economy.

McDonald said she received a PPP loan, and while she appreciates the funds, it was a temporary help, while COVID-19 is going to be an issue for at least several more months.

She said her losses are $20,000 monthly, whereas before the pandemic Heidi’s House turned a modest profit.

“We need federal support,” McDonald said.

Williams said a few trends are going the wrong way for the industry. Some parents have not returned to work and don’t need child care right now. Others have taken on alternative child care, such as nannies or extended family.

Some parents are trying to take care of children at home while working full time because they don’t believe the child cares are safe enough to prevent the spread of the coronavirus, even with enhanced safety precautions, such as more spacing between children at nap time, parents picking up children outside the building, and increased sanitation efforts.

McDonald said the COVID-19 guidelines – which are needed – nevertheless cost money. For instance, she needs more staff because they have to keep children separated into smaller groups rather than sometimes combining groups of children later in the day like she did before the pandemic. Also, temperature checks, screening questions and more cleanings add to the operating costs, she said.

The survey estimates that an average child care center needs $20,600 per month in government subsidies, while a home-based family child care needs $3,200 per month. Overall, the need in Maine is $18 million per month, “just to get us to spring,” Williams said.

“This is the need just for survival in the industry,” she said.

Williams said Maine’s need for child care money would be addressed in a $50 billion bill – the Child Care is Essential Act – pending in Congress. The bill is co-sponsored by U.S. Rep. Chellie Pingree, D-1st District.

“In order for parents to go back to work, they need to know their children will be safe,” Pingree said in a statement. “Congress must provide additional resources, like those included in the Child Care is Essential Act, so that our child care providers can safely navigate this public emergency and our children are protected.”

U.S. Rep. Jared Golden, D-2nd District, said in an email Friday that he supports additional child care funding but is still reviewing the the Child Care is Essential Act.

U.S. Sens. Susan Collins, a Republican, and Angus King, an independent, have not weighed in on the Child Care is Essential Act, but signed an open letter in May with 21 other senators urging an unspecified amount of additional federal funding to help the child care industry during the pandemic.

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