Business development program helps expand child care in central Oregon
Child care provider Damaris Elix knows firsthand how hard it can be to find day care in central Oregon.
After Elix moved to the United States from Guatemala in 2013, she struggled to find care for her son who has cerebral palsy. Good programs were either far from her home in Bend, had long waiting lists or were too expensive, she said. Unable to find a spot, Elix stayed home with her son until he started kindergarten.
When her next child was born, Elix stopped working to stay home with him, too.
“We didn’t have a good experience the first time around,” Elix said during an interview in Spanish.
Now Elix is one of several new child care providers getting a start in central Oregon with the help of a program created by the Central Oregon Community College Small Business Development Center and nonprofit NeighborImpact. The idea serves multiple goals: Help launch local small businesses by equipping adults to run successful child care businesses and help working families by providing more child care slots in communities that need them.
The Early Child Education Business Accelerator has helped 32 aspiring child care providers build business plans and learn how to become state-licensed since accepting its first cohort in October. Sixteen participants have received $5,000 start-up grants, and another five grants are under review. Central Oregon Community College estimates the accelerator has helped open 100 new child care spots so far and organizers hope that number will be close to 250, the goal they set when launching the project, by the end of the year.
Elix opened her child care business this summer using program-provided start-up funds. She calls it Dami’s House.
“The resources are there, the support is there,” Elix said. “It’s not just that you take the class and they give you money and that’s it. They are always there to help you.”
IN-HOME CHILD CARE DECLINES
All of Oregon’s 36 counties are considered “child care deserts” for infants and toddlers, meaning only one child care slot exists for every three children that age, according to the latest 2020 report from Oregon State University. Roughly 70% of counties have the same dearth of access for preschool-aged kids.
In Deschutes County, where Central Oregon Community College operates, only 22% of children ages 0-5 had access to regulated child care, according to the report.
Small-scale, in-home child care providers are a critical part of that landscape, said study co-author Megan Pratt, but they’ve been in stark decline. Oregon lost 32,000 slots in small family child care homes between 1999 and 2020, outpacing the growth of larger facilities and driving an overall drop in child care spots over the last two decades, the report said.
In-home providers are more likely to meet the needs of low-income families, provide weekend and evening care and provide culturally specific offerings than larger child care centers, Pratt said. More than a third of small, home-based providers are people of color and 35% speak a primary language other than English.
“They serve a really important purpose, and they’re shrinking in number,” Pratt said.
The pandemic prompted new turnover in the child care world, Pratt said, and many facilities that closed temporarily because of COVID-19 didn’t know if they’d reopen. Oregon State will do a new child care count this fall and Pratt expects to see a slight decline, with heightened impacts on small and home-based programs and those that rely heavily on private pay tuition rather than public dollars. Family and home based programs were least likely to report receiving public funding during the pandemic, a study from the Partnership for Preschool Improvement found.
On the plus side, Pratt said, the pandemic seems to have brought “increased attention and urgency” to strengthening the child care industry.
States have allocated over $2 billion in federal pandemic relief funds to strengthening the child care workforce, the White House reported last month. Deschutes County was highlighted in the federal report for its efforts to train new providers and expand child care facilities.
GOVERNMENTS PITCH IN
Small Business Development Center director Ken Betschart said the City of Bend approached Central Oregon Community College last year with the idea to support home-based child care businesses. The college partnered with nonprofit NeighborImpact to start the accelerator, using $125,000 from both the city of Bend and Deschutes County, along with some funding from the city of Sisters and the Small Business Development Network.
Organizers recruit students through classes at the community college, through NeighborImpact and through social media. The program is free, but students can expect to pay state fees to license their business. Course completers qualify for four college credits, said Denise Hudson of NeighborImpact, and they can also apply for a Partners in Practice scholarship to keep learning about early education at Central Oregon Community College or Oregon State University.
The state doesn’t have an education requirement for registered family care providers who can care for up to 10 children in their homes, Hudson said, but larger certified family care providers must meet a more stringent education or experience threshold.
Cohorts of 15 new or aspiring providers spend three months taking accelerator classes at Central Oregon Community College and working with an adviser to form their business plans. Classes cover how to set up a bank account for the business, register with the state, file taxes and set up a viable business model.
Participants who finish the program can qualify for $5,000 in start-up money to open their child care facilities and get continued support from staff who check in on them once their businesses are off the ground.
Anna Spengler, who took accelerator classes last fall, said instructors push participants to identify ways their businesses can offer something unique and help them break down their budgets to craft realistic tuition rates.
“I’m the type of person that puts a bunch of receipts in a shoe box,” Spengler said. “I thought about how I was going to design the place and decorate it and kind of the rhythm of the day. … I hadn’t thought more about the financial aspect of it.”
Karen Prow, with NeighborImpact, said the program helps providers plan for a sustainable business, which in turn helps prevent children from having to bounce from one child care to the next.
Childhood care wages are “substantially lower” than wages for occupations that require a similar amount of education and experience, according to a 2021 report from Portland State and Oregon State Universities. Lisa Tynan, an instructor for the accelerator, said that when she sits down to budget with providers, she’s found that they often pay themselves at or below minimum wage. One participant was paying herself only $4 an hour, Tynan said.
At the bare minimum, Tynan says the instructors try to help ensure the participants can pay themselves more than minimum wage, based on their experience in the field and the quality of the program. To meet their living needs, participants generally need closer to $20 to $30 an hour, she said.
The rate that providers charge parents depends on the costs of their particular programs, Tynan said. Daycare portal Wonderschool shows Bend in-home providers charging a wide range, with prices starting around $200 to 400 a month and climbing to a max of $1,500 to $1,920.
Some early participants ran into unforeseen barriers that kept them from finishing the program or getting approved for a license, Hudson said. Homeowners associations or landlords wouldn’t allow participants to have child care centers in their homes, for example, or their homes didn’t meet requirements set by the state.
Now, organizers require participants to take introductory courses to identify early challenges before they start the formal program.
“It’s really disappointing for them as well if they start going through this and they’re all excited and then they realize, ‘Oh, I can’t even do this in my home, my landlord won’t allow me,’” Hudson said.
Landlord approval is one of the biggest challenges prospective child care providers face, Prow said. Many prefer tenants who don’t have a child care business, and in Oregon’s competitive housing market, they have plenty of other options.
The accelerator runs in both English and Spanish and organizers say there’s been equal demand for both. Nine of 32 participants have completed the course in Spanish. Elix found out about the accelerator through a post on Facebook.
Elix earned her teaching credentials in Guatemala and had been teaching some Spanish language classes in the Bend area, but was nervous about starting a formal business. The classes taught Elix more about insurance and liability, she said. She learned which forms she needed to fill out and formal rules for running a child care center. The program gave her the confidence to take the plunge.
By offering classes in Spanish, Elix said, program organizers are helping support the local Hispanic community.
“They’re supporting, in my point of view, a better future for us,” Elix said. “With your own business, you can have higher income and that gives you better opportunities in life. That’s the value that (the program) is providing: They want people to grow.”
Dami’s House currently has two students enrolled, Elix said, but she expects that number to grow after summer vacation. When school starts, she will provide after-school care where English speakers can learn Spanish and children from Spanish-speaking homes can reinforce their skills.
Elix is licensed to care for up to 10 children in her home. If she reaches that threshold and wants to expand down the road, Elix said, she knows where to turn for help.
Central Oregon Community College and NeighborImpact plan to build up their program with the help of $8.2 million the Legislature awarded NeighborImpact, Prow said. The plan is to help another 60 central Oregon child care providers who can each get $5,000 grants for their businesses and to develop a parallel accelerator for larger child care centers.
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