Free Money! $700 Million in Grants for Daycare

For all those connected to the childcare industry, listen up; this one’s for you. On Thursday, October 13th, Acting Commissioner of the Department of Human Services, Sarah Adelman, announced the state would invest $700 million in new programs to help business owners, employees, and customers of the childcare industry.

For many, this has been a long time coming. This funding from the ARP was announced back in April. Perhaps the recent article discussing the state’s delay in distributing the funds lit a fire under the Governor and his deputies to get things going; for whatever reason, the wheels have started turning, turning they are!

Childcare has been and will continue to be a linchpin in getting New Jersey’s economy back to full capacity. These programs’ intent is to reduce that uncertainty, allowing business owners to staff, employees to work, and parents (and guardians!) to get back to their regular work/childcare routines without worry.

There’s a lot to unpack here. Unlike Return and Earn and SBL-EAGP programs we’ve discussed in the past couple of weeks, these new programs for the childcare industry have real teeth and a substantial budget; they’re not optics or simply politics, they’re absolutely going to make a difference in many peoples’ lives.

Now, let’s get into the different groups they’ll make a difference for, what that difference is, and everything we know about how they can capitalize on this situation.

How Much Money Can NJ Childcare Providers Get from Grants?

There will be two rounds of grants for childcare providers in the near future. The first round will provide grants between $20,000 to $80,000 to licensed childcare centers, while in-home childcare providers will be eligible to apply for $2,000 grants.

When the second round of grants will be, and how that will be directed remains unclear. It could be that the second round just refers to grants for summer camps, but we’ll keep watch of any updates regarding this point.

Additionally, further unspecified financial incentives to encourage childcare providers to expand their services to “non-traditional hours” will be implemented. While that’s quite vague, it’s encouraging for business owners to know an expansion of their services will be supported financially, making it possible to grow their business in areas that would have been too economically detrimental in the past. We’ll discuss this topic in greater depth when the specifics are detailed by the state soon.

The last perk that should interest childcare providers are the two $1,000 bonuses to be paid to childcare workers; the first of these bonuses will be this Winter, with the second coming in Summer 2022. While employees will be cashing the checks, this will benefit business owners as it will be easier to attract and retain employees through next summer. It remains to be seen if the state will pay further bonuses into the following year.

How Do Businesses Apply for the New Childcare Grants?

The application process hasn’t begun yet, so just keep checking for updates. Acting Commissioner Adelman said that grant applications will open in the coming months, and webinars will be held for childcare providers that clearly explain the application process.

Sharp will release another article on this topic as soon as the details on how to apply are released. For additional information, it’s a good idea to occasionally check with the Department of Human Services and the Governor’s webpage.

Are Summer Camps Eligible for the New NJ Childcare Grants?

Yes! Summer camps will be eligible to apply for these grants in 2022 and 2023. It has not yet been clarified how a summer camp is defined, as that’s a broad term, but there is sure to be further guidance coming in state webinars designed to explain the application process.

What Can NJ Childcare Providers Use Grant Money For?

New Jersey childcare providers will be able to use their grant money on rent, utilities, wages, benefits, as well as maintenance and upgrades to their facilities. Like many stimulus programs of the last years, it’s likely that recipients won’t be permitted to use this money for investments.

To be clear, it’s speculative to say that using these funds for growth will be prohibited, but it would align with the rules of past stimulus programs at both state and federal levels. It’s safe to assume from Acting Commissioner Adelman’s statement that the function of these grants is not to empower businesses for further growth; their focus is to ensure that providers can continue providing services and employing their workers.

What Will NJ Childcare Workers Get From These Programs?

As discussed in an earlier section, childcare workers will get two $1,000 bonuses. The first will be this Winter, the second will be in Summer of 2022

What Will Parents Get From the New Childcare Programs?

Parents and guardians participating in state childcare assistance programs will have their copayments waived in instances where there is a difference between the state’s subsidized rate and what their childcare provider currently charges; this will continue until the end of 2023.

Why is New Jersey Investing So Heavily in Childcare?

Governor Murphy and other state leaders recognize that revitalizing the economy requires giving workers the confidence they’ll be able to get to work. With school closures, it has been difficult for parents to make commitments to employers and their own economic growth with ever-shifting school schedules and closures.

During periods when schools were closed or running irregular schedules (school districts have varied in how they’ve handled the COVID crisis), parents and guardians have perpetually considered the possibility that they might suddenly have to take time off to look after their children.

Yes, childcare has been available to some extent, but it’s not the cheapest service, and for some, the costs of childcare and the money earned at work can cancel each other out. This situation resulted in some choosing to stay home instead of working, creating staffing problems for businesses. Even when workers were allowed to work from home, it has sometimes caused job-performance issues.

Quoting Governor Murphy

“Folks, if you’re hearing everything [Acting Commissioner of the Department of Human Services] Sarah [Adelman] went through, not a new theme, but more firepower directed at a multi-prong approach here.“

…If all you do is help the providers, they may not have enough families who can afford them or workers who can work there. If all you do is help the families, you may not have enough providers to deal with the supply of kids and families who are seeking that childcare, etcetera. Hats off to you, again, for being as robust on this front as any American state.”

To Sum It Up

It’s always fun to start an article with “Free Money!” and not have it be at all sarcastic. Childcare is a crucial component of New Jersey’s modern economy, and it’s hard to imagine how economic growth could occur without it. These programs are going to help not just childcare business owners, or workers, or customers, but they’re going to help the business community as a whole. The reliability of employees in all industries will increase as a result of this bill, making recovery and growth a real possibility in 2022.