Childcare Providers Are About to Lose a Safety Net

Children at Forever Young childcare center in suburban Green Bay engage in “parachute play.” (Photo courtesy of Cindy Veeser)

In the eight years that Cindy Veeser has operated her childcare center in the Green Bay suburb of Bellevue, Forever Young, she has provided an essential service — but she has also faced almost constant challenges.

At the height of the COVID-19 pandemic a few years ago, things got a little easier. Federal pandemic relief funds gave childcare providers like Veeser a new safety net — support and stability that they hadn’t known previously.

In Wisconsin the money went to thousands of providers, including Veeser, through Child Care Counts, a $20 million-a-month childcare stabilization fund that paid providers a monthly stipend.

The money helped childcare centers stay open and increase pay for childcare teachers, all without increasing costs for the parents depending on childcare so they could work.

“Federal stabilization funding prevented system collapse, supporting 5,762 programs, 75,740 educators, and more than 430,000 children, while helping reverse a decade long decline in licensed child care,” the Wisconsin Early Childhood Association states in a report issued in May.

“It made everything possible,” Veeser says of Child Care Counts. “My teachers were getting paid a little bit closer to what they should have been making at that time.”

The money didn’t just go to wages. “There wasn’t one thing that it didn’t help cover,” Veeser says.

At the end of this month, however, providers will lose the last vestige of that support. One year of “bridge” funding from the 2025-27 Wisconsin state budget ends June 30, and childcare providers across Wisconsin are unsure what happens next.

“We’re holding things together the best we can now,” Veeser says. “I just see us falling behind.”

One in four centers could close

More than a year ago one out of four Wisconsin provides told researchers that without Child Care Counts funding they could close down entirely.

More than one in three said they would probably reduce the number of hours they could provide child care. And nearly three out of four said they would have to increase the fees they charge parents.

The survey results were reported in March 2025 by the University of Wisconsin Institute for Research on Poverty. At the time, Wisconsin child care experts were looking ahead to June 2025, when the federal funds that paid for Child Care Counts would run out.

Providers, advocates, Gov. Tony Evers and Democrats in the Legislature had hoped for $480 million in the 2025-27 state budget to continue the stabilization program. What they got was less than 25% of that: $110 million for one year of stabilization funds that ends June 30.

WECA’s May report looked to the 2025 UW survey to forecast what could follow, and solicited new comments from providers.

“I believe that the numbers we reported on, which are the most recent data we have, are going to be much higher in reality,” says Paula Drew, WECA’s director of early care and education policy and research.

“Every provider is talking about the cost of what they’re paying for everything.” in comments submitted to WECA, Drew says. “Many, many, many of them said, ‘I will price parents out and I will likely close,’ or ‘I’m planning on closing because there’s no way I can pay my teachers less.’”

Increased fees and families dropping out

As fees rise, some families drop out of childcare programs. “There’s a huge, growing trend of under-enrollment due to parents not being able to afford the increases that they already have in tuition,” Drew says.

In The Beginning Child Care and Preschool operates centers in Boscobel, Prairie du Chien and Dodgeville, each licensed for 50 children.

“Child Care Counts was a huge difference in our operations,” says director and owner Beth Markut. “We were able to give the staff a minimum of a $2-an-hour raise. We were able to afford new supplies. It was a game changer for us.”

It also helped Markut and her husband, Patrick, open the center in Dodgeville, where they live, in 2023.  “I don’t know if we would have done that if we hadn’t had Child Care Counts, but my guess is probably not,” Markut says.

When Wisconsin cut Child Care Counts payments in half in 2023, In The Beginning increased tuition by 2.5% to 3%, Markut says, and she expects a similar increase after the bridge payments end.

In The Beginning’s increases have been modest compared with those in a state survey, which reported increases for infant care ranging from 11% to 14%, according to WECA.

Nevertheless, Markut says, “I’ve had four families leave our Dodgeville center because it’s cheaper for them just to stay at home” instead of both parents working.

Markut says she’s confident that In The Beginning can keep operating, but she also hopes that lawmakers will come around to the need for ongoing childcare support.

“I don’t think they understand what our profession does through day in and day out,” she says. “If they really understood they would support us, but they don’t. It doesn’t just affect us, it affects the broader economy.”

Shelly Boelter has operated a family child care program in the community of Hager City in northwestern Wisconsin for 23 years.

The family care license is limited to eight children at a time. Boelter built her home with the lower level as childcare space designed into it from the start. “When I was 12, this was what I dreamed of doing,” she says.

Child Care Counts enabled her to take a better wage, cover expenses and put some money away for retirement. That ended when the stabilization stipend was reduced.

To keep going, “I’ll be spending less on things that we could use, to try to just keep it affordable,” Boelter says.

She says she tries to avoid raising rates for families who already have children enrolled, however, because “I don’t want money to be an issue for them to leave.”

As a result, fees vary from one family to another. In the coming months, she expects to raise her rates for new clients, however. “Probably a 25% increase would not be unrealistic,” Boelter says.

She would need even higher increases to fully cover escalating costs, “but families would not be able to afford it,” she says. “I have some families with three children here. They can’t afford that cost for themselves and actually make a living, either.”

‘It’s going to get worse’

With the bridge funding ending and a significant number of programs at risk of  shutting down, advocates say their focus now is on the 2027 state budget, which will be hammered out by  a new governor and a new  state Legislature.

And the childcare economy is likely to become even more precarious.

“The stabilization funding in Wisconsin did some really remarkable things, and it’s really, really sad that we’re just going to see those things roll back,” Drew says.

“There’s a lot of different ways to approach the next budget,” says Ruth Schmidt, WECA executive director — from a new system of direct payments like Child Care Counts to new tax policies or tapping a revenue source, such as legalizing cannabis and then taxing it as a dedicated childcare funding stream.

“The bottom line is, this all is revenue. There’s no way to fix childcare to make it affordable for families, to make it stable within an economy without paying for it,” Schmidt says.

“So, is it going to get worse? We anticipate it’s going to get worse,” she says. “We anticipate it getting significantly worse. And every possible strategy needs money. We can’t just rely on providers to continue to sort of take this on their backs, and it’s not good for them, and it’s not good for kids and families.”

Childcare providers are about to lose a safety net was originally published by Wisconsin Examiner.