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Payment backlog leaves Missouri child care providers desperate and about to close
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This spring, the state of Missouri owed Kimberly Luong Nichols $5,000 in backlogged payments for children at her Kansas City daycare who were part of a state subsidy program.For four years, she’s operated a licensed daycare inside her home, where she currently serves 10 children. Luong Nichols stopped drawing a salary last summer to pay for improvements to her center and two new hires, expecting to draw down a salary again this year.When the full subsidy she was owed stopped arriving, she laid off those staff. And as they’ve done for the past year, her family of six relies solely on her husband’s $53,000 salary.They’ve given up little luxuries like going out to dinner and buying fancier shampoo. And they’ve given up bigger luxuries, like vacations.When bill collectors started calling, her husband considered getting a second job. On several occasions, she considered doing away with the daycare entirely. But she didn’t, not wanting to leave the families — many of whom have children with developmental disabilities, or who are in the foster care system — with the stress of searching for a new day care.Luong Nichols is among thousands of child care providers across Missouri who rely on a state child care subsidy program to keep their daycares afloat.The subsidy, part of a federal block grant program that is state-administered, helps cover the cost of serving low-income and foster children.But since late last year, a series of changes created a major headache for many providers and families, as parents were unable to register their children and providers in the most dire circumstances were left without money to pay their staff.The Missouri Department of Elementary and Secondary Education, which oversees the program, has largely blamed a contracted vendor for the months-long backlogs. The system, which launched in December, is still not fully operational.“ … There have been a number of unforeseen challenges during the transition, which involves loading family and provider data from the existing state systems into the new (Child Care Data System),” Mallory McGowin, a spokesperson with the department of education said in a statement Wednesday. “The (Office of Childhood) is working hard to mitigate these issues and sincerely apologizes to the child care providers and families affected.”But similar backlogs plagued the system three years ago, as parents struggled to enroll children and providers had to make serious budget cuts.The latest problems have forced some daycares to close. Others have shifted from serving vulnerable children who qualify for the state subsidy to only admitting families who can afford to pay on their own.Many providers, like Luong Nichols, have weeks where they’re barely hanging on.
Kimberly Luong Nichols, who operates a licensed daycare inside her Kansas City home, said she’s nearly closed several times over the past year after the state was late on payments it owed to her.
Payment backlogs not newIn Missouri, child care providers can be registered to get a government stipend for every child on subsidy, meaning they receive a partial amount of tuition directly from families, and then the government covers the rest after care has been provided.The child care subsidy is a federal program administered by states through the Child Care and Development Block Grant. Families apply for the state to directly pay a child care provider for part of the cost of care.Only very low-income families qualify in Missouri, along with foster kids and children with special needs. The maximum income a family can make to qualify is 150% of the federal poverty line, or $46,800 for a family of four.The average cost of full-time, center-based care for an infant in Missouri was $11,059 as of 2022, according to Child Care Aware.There were about 21,000 children receiving the state subsidy as of November, the last publicly available state data. The program shifted from being administered by Missouri’s Department of Social Services to the education department in December. McGowin said the current number is closer to 23,000 children.Roughly 1,800 of Missouri’s 2,800 licensed and license-exempt providers, including school districts, are contracted to take children on subsidy, Pam Thomas, assistant commissioner for Missouri’s Office of Childhood, said at a State Board of Education meeting last month.“We do continue to struggle a bit with our vendor and meeting what our expectations are for an efficient and effective system and making clear what’s needed,” Thomas told the board. “And quite frankly the vendor is not delivering on those results to what I would say are our expectations as a department.”The vendor contracted to develop and implement the new system for the subsidy program is World Wide Technology, McGowin said, a large technology services provider headquartered in St. Louis.Board members expressed concerns with how to move forward as Thomas reassured them that her department was working “around the clock” to urge the vendor to fix the bugs in the system, which spans about nine steps between a family’s application for subsidy and payment to the provider.“We have to be cautious about how many more changes we add into the system right now,” she said. “ … We can bend it, but we certainly can’t break it, and I think we’re on the verge of that right now.”
Yet this isn’t the first time the state’s handling of the subsidy program has caused widespread problems for providers and families.In 2021, the state blamed the COVID-19 pandemic and the rollout of a new system used to track attendance, called KinderConnect, for a backlog of thousands of payments.In spring 2023, parents reported waiting several monthsto be approved for the state assistance, leaving them struggling to juggle work and child care.State Sen. Lauren Arthur, a Democrat from Kansas City, said she was notified of the current spate of issues a few months ago by legislative staff who’d started hearing concerns from constituents.“It feels like way too much time has passed,” Arthur said. “I suspect that child care providers across the state have already closed as a result of these mistakes and it’s totally unacceptable when already providers are struggling. There are already not enough seats available for children who need them.”Asked last month if she was looking at alternative vendors ahead of the current multi-million dollar contract running out in December, Thomas, with the education department, said she wasn’t opposed.However, on Wednesday, McGowin, said the department is not currently planning on finding a new vendor. The subsidy payment issues – 60% of which came from technical issues, according to the state – are expected to be resolved by the end of July.Missouri pays providers for services after they’re performed, rather than in advance. This, coupled with the fact that providers are paid based on attendance rather than enrollment for children in the subsidy program, makes budgeting nearly impossible for providers who take low-income and foster children.“We’re really relying on the state and DESE to really prioritize solving these system challenges so providers can be paid quickly,” said Casey Hanson, director of outreach and engagement at the child advocacy nonprofit Kids Win Missouri.Hanson has spent hundreds of hours with child care providers over the past several years. She knows what’s at stake.“They’re some of the most resilient people,” she said. “They care about children, they care about the future of our state more than almost anyone.”
Tine Mosley, owner and operator of Our Daycare and Learning Center in north St. Louis, said she knows of several providers in her area who were forced to close after state subsidy payment were delayed.
‘Our own personal pandemic’Tina Mosley was among the providers who made the difficult decision to stop taking children on subsidy.For 28 years, she has owned and operated Our Daycare and Learning Center in St. Louis, which is licensed for 10 children. It sits in the Normandy school district where the median household income is less than $39,000, and more than 56% of students in public school have SNAP benefits, according to 2021 data from the National Center for Education Statistics.Every other provider she knows in the area accepts children on subsidy. And they’re all in the same predicament.“Every one of my colleagues and friends, the state is behind on paying them,” Mosley said. “To the right of me, to the left of me, across the street from me, behind me.”By only taking private paying families, and by ceasing to collect a salary, Mosley said she’s been able to continue employing her two staff, both of whom are young mothers. And while they no longer take children on subsidy, they still service lower income families, she said.As a result, she’s not left waiting on payments from the state. A handful of home and center-based providers she knows in the St. Louis area already closed because of the lag.Several months ago, when most of her children were from the subsidy program, she was helping parents sign up for state benefits as the system transitioned over. She recalls parents sharing screenshots of hold times on the phone with the state surpassing an hour before they had to hang up and return to work, unable to get the immediate help they needed.“Early child care right now, we feel like we’re in our own personal pandemic,” Mosley said.But unlike during the COVID-19 pandemic, when government bodies and communities showed up in stride to keep child care providers in business, Mosley said it feels like most people have now turned their backs.Luong Nichols, in Kansas City, has considered doing what Mosley has done: stop opening her services to families on subsidy.In an April email to a staffer in Arthur’s office, she lamented her situation. The system had two of her kids on subsidy listed as private pay. A glitch wouldn’t let her submit attendance. She hadn’t heard back on her help ticket.“I am due to renew child care subsidy next month and really considering not doing it,” she wrote in an email she shared with The Independent. “Payments are still not correct, they owe me all of February and past corrections. Now we are about to end March and that will be added.”After sending this email, Luong Nichols went on to interview at a local school district. She ultimately turned down the job offer, unable to part with the children in her care, including foster children, kids with behavioral difficulties and low-income children.“I have single moms and foster children that have been kicked out of other daycares or gone through many placements before they landed on my door. And the kids that I take care of, they’re like family.”Instead she continued to spend hours on the phone during nap time begging anyone to make her business whole again. She called the Missouri Department of Elementary and Secondary Education and the governor’s office. She even called the White House.“I’ve had to take on an extra load of work just to fight for something that I’m entitled to,” she said.As of Wednesday, she said her payments were caught up through May. She credited her persistence, and assistance from Arthur’s staff, for speeding up the payment.At the same time, Luong Nichols has seen three area centers and four private daycares shutter. She directs most of the blame at the department of education.“DESE has pushed the industry to the point of no return right now,” she said. ”We’re not going to have enough child care providers in the state of Missouri by the end of this year to take care of subsidy children.” She said it will move to private paying families only.Hanson, with Kids Win Missouri, said there isn’t currently enough data to know the reality of the child care landscape.In response to a Sunshine request submitted by The Independent last month, the education agency said they do not currently track the number of backlogged payment resolution requests.“The reality is, yeah, there are providers that will close,” Hanson said. “That’s why we continue to advocate that we need more state level funding in this space to really maintain a supply.”This story was originally published by The Missouri Independent, part of the States Newsroom.
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Laclede’s Landing has cycled through many identities throughout the history of St. Louis. Now, some people involved with its redevelopment in recent years hope the landing’s next one will be as a residential neighborhood.The small district tucked directly north of the Gateway Arch National Park has quietly undergone a massive redevelopment with more than $75 million pouring into the rehabilitation of many of the historic buildings at the landing.“We are starting to feel that momentum, especially in the last really 60 days. Things have drastically changed around here,” said Ryan Koppy, broker and owner of Trading Post Properties and the director of commercial property for Advantes Group.Advantes alone shouldered the rehabilitation of six of the historic buildings, which now sport a mix of apartments and retail or office space, he said. Four of those buildings are completed, and of the 119 apartments available, about 90% are filled, Koppy said.“It just shows you what kind of demand we do have for the area,” he said. “We’re separated from downtown a little bit, and for the tenants, their local park where they’re walking their dogs, it’s a national park.”
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St. Louis Public RadioInterior of the Peper Lofts at Laclede’s Landing on Aug. 16
Another 40 apartments are set to come online next year along with some retail space, Koppy said. He added he’s noticed a wide range of people who are considering and moving into the newly refinished apartments.“It’s very mixed, surprisingly,” Koppy said. “We have a lot of young professionals, maybe on their second job out of [university], we have some empty nesters too.”Part of the newfound momentum comes from a new market, the Cobblestone, and coffee shop, Brew Tulum, opening recently and bringing more foot traffic to the area, said Brandyn Jones, executive director of the Laclede Landing Neighborhood Association. She added that more apartments are set to come online within the next few months.“We have a great riverfront area here and so there are plans in the works to activate those spaces, bring people in,” she said.That could be more daytime events, like a farmers market, music festivals (one of which is happening this weekend) or just bringing in food trucks to Katherine Ward Burg Garden, Jones said. It’s a departure from the identity the district held a few decades ago as a hub for nightlife and entertainment.“That’s part of what connects so many people to Laclede’s Landing,” Jones said. “It’s important to tell the story of where we’re evolving. It won’t be what it was in the same exact way, but it will still be fun, and it can be fun early morning, midday or late night.”It’s a view shared by Koppy.“It’s grown up, it’s a bit mature,” he said. “We’re not going to have 3 a.m. bars here anymore because we have residents here.”Koppy added that Advantes is joined by other developers working to rehabilitate buildings in the district.“We all work in unison,” he said. “If I get a call and [a client is] asking for something and maybe the square foot doesn’t really match up with what I have available, but I know it matches up over there, they’re getting a very warm welcome and introduction.”
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St. Louis Public RadioRyan Koppy looks out the window of Brew Tulum Specialty Coffee Experience on Aug. 16 at the Cobblestone on Laclede’s Landing in downtown St. Louis.
This push toward making Laclede’s Landing a residential neighborhood also comes alongside broader conversations about the future of downtown St. Louis more generally as it looks to move away from a dependence on office space. While the city as a whole continues to lose population, downtown added about 1,700 people between 2010 and 2020, according to U.S. Census data.“It’s been wonderful timing to have all that going on, that stress that you’re not just in downtown to work has been critical to part of this rejuvenation and energy down here,” Jones said. “Sometimes people forget Laclede’s Landing is part of downtown, really the original downtown.”And success in the small district could spread beyond its small confines and potentially serve as a model for success, Koppy added.“My idea is, if we could get all the great things of St. Louis coming in through here, we can eventually spread that,” he said. “We understand we can’t change the whole world, but we’ll just make the effort to try and change the world around us.”
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The largest barbecue competition and tasting festival in St. Louis, Q in the Lou, has been canceled. The event was planned for Sept. 6-8, but organizers decided to cancel it due to poor ticket sales and insufficient corporate sponsorship.The traveling festival had low attendance in Denver last week, said Sean Hadley, a festival organizer.“We made the tough decision to cancel Q in the Lou,” said Hadley. “We’re seeing a lack of support … it’s just not there.”The traveling event first came to St. Louis in 2015 and drew hundreds of people to downtown St. Louis for barbecue, live music and a “major party.”“It shut down out of the blue … I’ve gone every year,” said Scott Thomas, local chef and food blogger. “It’s brilliant. You could take a tour of some really amazing barbecue restaurants and competition barbecue guys all in one place.”In a late July news conference, city officials touted Q in the Lou as a significant tourism draw and a boost for downtown revitalization.“Bringing a signature national festival back to downtown St. Louis … is making us stronger,” Greater St. Louis Inc. CEO Jason Hall said then.Less than a month later, ticket holders from every festival stop learned they’d be refunded. On Monday, organizers privatized the Q in the Lou website and deleted its social media accounts.Conner Kerrigan, a spokesperson for Mayor Tishaura Jones’ office, said city officials are disappointed the festival won’t be back this year.“St. Louis knows how to throw a festival … bringing people together to celebrate our culture is one of the things we do best as a city,” Kerrigan said in a statement. “Should Q in the Lou try to come back next year or any year after that, they’ll have the support of the Mayor Jones administration.”
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The Jacoby Arts Center, a staple of Alton for many in the Metro East community, will likely permanently move out of its downtown building at the end of September.Its departure and relocation from the historic building that the arts center has called home for the past 20 years has created a tense situation for not only the arts center’s supporters but also the local development company working to revitalize Alton’s downtown that owns the building.“It’s an unfortunate situation,” said Chad Brigham, the chief legal and administrative officer with AltonWorks, the real estate company owned by another prominent local attorney working to develop the town. “I wish there wasn’t misunderstanding and disappointment in the community. It’s difficult sometimes to clarify that.”When news of the likely departure spread in June via a letter from the Jacoby Arts Center to its supporters, an outcry on social media quickly followed. Some assumed it would be the end of the arts center.“There’s a lot of feelings right now that I think are more about the building itself than there are about the Jacoby Arts Center,” said Valerie Hoven, vice president and treasurer of the nonprofit arts center’s board.For supporters of the Jacoby, moving from the building and likely never returning will be a sad affair. Exactly what’s next for the arts center remains unclear. However, Jacoby board members believe this will not be the end of the organization. It will likely look different though.
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St. Louis Public RadioThe Jacoby Arts Center earlier this month in downtown Alton
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St. Louis Public RadioThe Alton-based Jacoby Arts Center features more than 75 St. Louis-area artists and their work.
The history of the buildingFirst dubbed the Madison County Arts Council, the nonprofit arts center renamed itself after the Jacoby family gave it the current building in 2004. AltonWorks founder John Simmons purchased the Jacoby Building in September 2018, according to property records from the county.Managing the large building, at 627 E. Broadway, became too expensive for the Jacoby Arts Center. In 2018, the organization approached Simmons to purchase it, said Dennis Scarborough, a past president of the board and a downtown business owner.“Of course, it sounded really, really good,” Scarborough said of Simmons’ purchase. “He took over the insurance, property taxes, all those kinds of things that were really, really getting into our budget, and he rented it to us at a fair price.”The two parties entered into a lease agreement initially for five years. Since then, Simmons has spent more than $1 million in upkeep, taxes, insurance and more on the building. The lease has been extended twice until the end of September this year.Over the six years, Jacoby paid $1,500 per month, which covered a portion of the utilities.“It’s been wonderfully generous of AltonWorks,” Hoven said.Because the building is aging and needs repairs, Brigham with AltonWorks and those connected to the arts center have long known the Jacoby Arts Center would need to relocate — at least temporarily.
Renovations on the Jacoby building will begin this fall. They’ll include modernizing the aging building, repairing the old elevator and putting in apartments on the second and third floors.
News of the likely departure and controversyRenovations will begin this fall. They’ll include modernizing the aging building, repairing the old elevator and putting in apartments on the second and third floors.In May, it became clear that a preliminary proposal for the arts center to return to the building after renovations finished in 2026 would not work for them, Hoven said.She estimates the first floor and basement of the Jacoby Arts Building span roughly 20,000 square feet.
Chad Brigham is a business and legal adviser for AltonWorks.
AltonWorks’ initial idea floated to the arts center would only provide 2,553 square feet, according to both Hoven and Brigham. While the board calculated the price for the new space to be at least triple the current payment, Brigham said there was never a specific price discussed.“No discussion in terms of actual rent price,” he said.AltonWorks didn’t make a specific rent offer because the organization doesn’t even know itself, Brigham said.In addition to cash from John Simmons, there will be loans, tax increment financing and state tax credits to cover the $20 million in building renovations. The entities financing the cost of renovations will also help determine the rent when the construction is complete, Brigham said.Regardless, the price required to return will be too much for the arts center to pay, Hoven said. Also, the organization would like to maintain the many programs it offers to the community — a rentable event space, a dark room and a clay studio, for example — in the future.“For us to really meet the needs of the community and be sustainable, we need a space where we can offer some of those programs — the artists’ shop, and other spaces that offer some kind of income as well — so that we can continue to give money back to the community,” she said.AltonWorks offered at least two other locations as possible alternatives from their vast stock of buildings along Broadway to house the arts center during the roughly 18 months of construction. Those alternatives came with similar deals requiring the Jacoby to cover only utilities, Brigham said.“We did put in a great deal of work behind the scenes in trying to find an interim solution,” Brigham said. “We wanted to find a place for them to go, where it was easy for them to continue programming, whether it’s 100% of it or some portion of it, that would work for them.”Initially, the arts center hoped to keep the basement during the renovations, Hoven said. When it became clear the preliminary offer to return was for much less space than the arts center anticipated, the letter to the community was sent.“The letter that came out was merely showing our surprise,” Hoven said. “Don’t misinterpret it as panic. Don’t misinterpret it as desperation.”
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St. Louis Public RadioA smorgasbord of radios are displayed at the Jacoby Arts Center in Alton.
The commentary on social media was passionate. Some critics of AltonWorks said the organization has good intentions but hasn’t executed those plans. Others said Jacoby hasn’t planned well enough for the future.For Brigham and the AltonWorks team, some of the criticism has been disappointing.“I thought that there were some decent solutions. Were they perfect? No, but they were very, I thought, very good solutions,” he said. “And the fact that it has come to the point that it is right now is a bit hurtful.”AltonWorks remains committed to the arts, Brigham said. John Simmons remains one the largest donors of the Jacoby Arts Center, Hoven and Brigham said.“I don’t think there’s ever been a question of our support of that organization — of our affinity for that organization,” Brigham said. “While some of the events were unfortunate, some of them were encouraging. The entire community rallied around the Jacoby Arts Center. That’s a good thing. It’s a good thing to have a love for the arts like that in a downtown community.”Sara McGibany, the executive director of Alton Main Street, an organization aimed at preserving the town, said AltonWorks should be commended for its vision. In many ways, her organization and AltonWorks share a vision for a thriving downtown.Even though AltonWorks hosts public meetings, McGibany believes the current situation lacks true community engagement.“We really think that if AltonWorks can get past some of the communication hurdles — and harness the community’s passion and shift to more of a bottom-up decision-making process that centers on community input — then we can turn around the growing sentiment of distrust that’s happening now,” McGibany said.Scarborough, the past board president and downtown business owner, echoed the praise for Simmons and his support of the Jacoby Arts Center. With the Jacoby likely moving, the future looks bleak, though.“It’s a community arts center that does a lot of good work,” Scarborough said. “The community is going to suffer, and they’re going to be missed by the community if they’re not there.”
Eric Lee
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St. Louis Public RadioShalanda Young, director of the federal Office of Management and Budget, talks to Illinois U.S. Rep. Nikki Budzinski, D-Springfield, during a tour of a construction project by AltonWorks last April in Alton. AltonWorks, who is building the LoveJoy Apartment Complex is receiving over $1 million in federal funding.
What does the future hold?AltonWorks will continue forging ahead with its ambitious plans to revitalize Alton. The organization hopes to conclude construction on the Wedge Innovation Center, which will have a restaurant, retail and co-working space, this fall. Lucas Row, a mix of apartments and retail space, is scheduled to be completed next spring.The remainder of the arts and innovation district, currently named after the Jacoby, will also move forward.“I believe in two years it’s going to be a much different place,” Brigham said of Alton. “It’s going to be thriving. It’s going to be new businesses, new tenants — and it’s going to be a nice proof of concept for what you can do in a small community like that.”The Jacoby board recently formed a strategic planning committee. Its task: figuring out what’s next for the arts center. The committee will reevaluate what space the Jacoby needs, what programs it wants to offer to the community and how they want to make that a reality.Keeping the arts center is essential for board members like Hoven. In her experience, it’s been a place where local aspiring artists get their start.“Art is one of the only ways to show your true authentic self,” Hoven said. “And there’s more people than I realized who do not get that opportunity every day.”The Jacoby will shut its doors to pack over the next month. Hoven said she’s optimistic the board will have concrete plans by the end of September when their lease officially ends.“Alton is such a fabulous and supportive community,” she said. “We still have lots of great options, so that the Jacoby Arts Center will continue to thrive in Alton and beyond.”
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