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Budget gridlock strains childcare programs

Posted on: September 29th, 2025 by Kristen Miller

Childcare providers were already struggling to keep up with the demand for their services. Then came the deadlock over the state budget, which has lasted nearly three months.
• For each week without a state budget, providers in Central Pennsylvania are missing out on about $1.1 million in state subsidies, according to Christy Renjilian, executive director of Community Connections for Children, a York-based nonprofit that supports childcare programs in Adams, Cumberland, Dauphin, Lancaster, Lebanon, Perry and York counties.
• Some providers have responded by borrowing money or charging for services that are typically free for low-income families, Renjilian said.
• Others are cutting classrooms and laying off teachers, translating into between 500 and 1,000 children who have lost access to childcare in the seven counties, Renjilian estimated.
• “That’s a moving target,” she said. “The longer this drags on, the more programs are going to shut their doors.”
How is this happening: The budget impasse has frozen two sources of funding for childcare, according to Renjilian.
• They are the Pre-K Counts and Head Start State Supplement programs. The latter supplements federal Head Start funding.
• The two programs fund about 35 providers serving roughly 4,300 three- and four-year-old children from lower-income families.
• Some of the providers operate in school districts, others are housed inside larger nonprofits, Renjilian said.
Why does it matter: Local and statewide business groups have identified access to childcare as a key workforce issue.
• About 81% of businesses in Pennsylvania face moderate or significant recruitment and retention issues due to childcare, according to a 2024 report by the Pennsylvania Chamber of Business and Industry and the Pennsylvania Early Learning Investment Commission.
• In York County, private-sector leaders have poured several million dollars over the last few years into initiatives designed to boost the supply of childcare spots, which shrank during the Covid-19 pandemic.
• “This is an ongoing, chronic issue,” Renjilian said, noting that her organization has recently seen an uptick in calls from parents scrambling to find childcare.
Where’s the budget: The state’s current fiscal year began on July 1 without a spending plan in place.
• Lawmakers and the Shapiro administration appear no closer to a compromise than they did nearly three months ago.
• Childcare providers hope the two sides can at least agree on a $55 million proposal that would bolster efforts to recruit and retain teachers.
• They earn, on average, about $12.40 per hour, Renjilian said. “Getting any additional funding to support the educators is just critical and will have a direct impact.”

Source: https://biznewspa.com/news/