Child care providers from across New Mexico told lawmakers Monday that if the state doesn’t compensate them for revenue they lost due to drops in enrollment, they could be forced to shut down.

Lupe Nevarez, CEO of The Children’s Garden Child Development Centers in Las Cruces, said her sites are seeing declines in both private tuition and state subsidies for low-income students. The financial hit combined with increased costs for staffing and operations during the COVID-19 pandemic has created an unsustainable situation for her centers and those statewide, she told members of the Legislative Education Study Committee during a virtual hearing Monday.

“I speak to many providers who say, ‘We’re not going to make it. We’re going to close.’ I’m worried too,” Nevarez said. “Our legislators do not like to pay, but the money is there to continue last year’s funding levels.”

Elizabeth Groginsky, Cabinet secretary of New Mexico’s new Early Childhood Education and Care Department, said 35 percent of the state’s 900 child care providers are now closed.

With public school campuses also closed due to COVID-19 risks and children in prekindergarten to 12th grade learning via online platforms, child care centers are the only option for many working parents, she said.

In March, when the pandemic arrived in the state, around 45 percent of the state’s child care centers closed. Those that remained open operated at just 15 percent to 30 percent capacity. Through June, the state used federal CARES Act funding to continue to fund tuition subsidies for child care providers at pre-pandemic levels, meaning they received funds for a child who might now show up during the pandemic-related shutdown.

The state has since returned to dolling out child care assistance payments based on monthly enrollment.

Navarez said centers lose additional funding when an enrolled student doesn’t show up for five straight days.

State Rep. Rebecca Dow, R-Truth or Consequences, founder of the AppleTree Educational Center in Truth or Consequences, said the state budgeted for 24,000 subsidized child care slots but is paying for only about 19,000. She said the state should boost its payouts.

“The money is there now,” Dow said. “The failure now is allowing public school pre-K to continue remotely while sending children who need child care to a private child care center, where essential workers are underpaid, overworked understaffed, underfunded and absolutely essential for recover.

“We’ve shifted no dollars,” she added. “We’ve simply pulled them back.”

Nevarez said before the pandemic, her six child care centers, which employ 167 workers, served nearly 800 kids between 6 weeks and 12 years old across Las Cruces. They are now down to around 450 children, she said, and about 90 percent qualify for state child care aid.

One center has seen its monthly revenue drop from $84,000 to $24,000, she said, while its expenses remain steady around $60,000 — because fewer children do not mean lower operating costs or staffing requirements.

For instance, Nevarez told lawmakers, a case of protective gloves has risen in price from $37 in March to $80 this month.

While one aide was able to serve lunch in every classroom before the pandemic, she said, a worker is now prohibited from passing through multiple classrooms in a day or even watching a class so a teacher can take a bathroom break.

Child care centers are required to operate with no more than 20 3- and 4-year-olds in a classroom, with a student-teacher ratio of 10-to-1.

“We had to hire additional employees to operate safely in this new environment,” Nevarez said. “Costs are going up but our revenue is down. Child care is essential. The state needs to step in because this doesn’t feel sustainable.”

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