Childcare businesses are growing in Stanislaus County. Cuts to federal funding may hinder that
Stanislaus County, a childcare desert, has been making substantial headway in expanding childcare access. However, potential federal funding cuts to programs including Head Start could impact its progress.
Head Start, a federally funded early childhood program, provides free preschool and childcare services to low-income families. It also supports various local childcare centers, schools and organizations, including those in Stanislaus County.
Over the past year, Stanislaus County has been increasing the number of childcare businesses to address its shortage, particularly for infant care. This expansion not only provides more childcare options but also allows more parents to participate in the workforce.
Stanislaus 2030 has partnered with Nurture, a nonprofit that helps individuals start their own childcare businesses. According to Amanda Hughes, executive director of Stanislaus 2030, Nurture has streamlined the typically yearlong licensing and business setup process into just 12 weeks.
Through the program, entrepreneurs receive training, peer support and a $2,500 startup grant to help launch their businesses. Nurture’s goal is to simplify the bureaucratic hurdles that often make starting a childcare business difficult.
Since last year, the organization has helped establish 64 new childcare businesses, creating 520 licensed childcare slots in Stanislaus County. With funding from the American Rescue Plan Act, secured through the county and the city of Modesto, Nurture now has the resources to support 230 additional businesses over the next two years.
First 5 Stanislaus has also contracted with Nurture to scale their work.
However, Hughes said that potential federal funding cuts could impact their efforts at the local level.
Following a temporary federal payment freeze last month, many Head Start programs still report challenges accessing their approved grant funds, according to the National Head Start Association.
Recently, it has been reported that 20% of staff at the Office of Head Start and 25% at the Office of Child Care have been fired as part of widespread federal job cuts led by Elon Musk and the Department of Government Efficiency.
“Thousands of families will feel the ripple effects of these firings across the country,” reads a letter to the Department of Health and Human Services from the Democratic Women’s Caucus. “Additionally, the data shows that without sufficient child care, both families and the economy will suffer. The federal workers who serve in the Office of Head Start and the Office of Child Care are integral to making sure families can access affordable, high-quality care and education.”
Hughes said cuts to Head Start would affect about 1,300 children in Stanislaus County who rely on federal funding, plus 200 jobs. It would eliminate $33 million in funding for the county’s childcare system, along with an additional $9 million for Migrant Head Start.
“I’m really concerned about the system as a whole being able to handle that type of loss. If you pull money from here, it just robs it from somewhere else,” Hughes said.
Judy Boring from the Stanislaus County Office of Education said that as of right now, SCOE has been able to access the funding portal for its Head Start program.
Jennifer Brooks, executive director of Nurture, said that while the nonprofit doesn’t anticipate losing the funds already under contract, there is long-term uncertainty about its ability to sustain its work.
She explained that Nurture also relies on small business development funds, which are matched with federal and state dollars, as well as workforce development funding.
“The writing on the wall in Washington is that they’re just going to be cuts, right? There’s going to be cuts in any program that is a social service and so there will be competition for those public dollars. So I think everyone’s going to tighten their belts,” Brooks said.
Shameram Karim, executive director of First 5 Stanislaus, said federal cuts won’t impact the organization because it is state funded. Still First 5’s funding has been decreasing over the years since it comes from tobacco tax revenues.
“Our funding is declining because less people are smoking, which is a good thing, but that does mean that our funds do slowly decline every year,” Karim said.
The number of home-based childcare businesses in Stanislaus County has declined from 769 in 2003 to 320 in 2023, which equates to a loss of about 1,800 childcare spots.
“It’s not just that we are kind of starting from zero. We’re starting from a deficit,” said Brooks.
She said Nurture has been exploring ways to secure future funding as ARPA dollars will eventually run out. It plans to host six cohorts per year in both English and Spanish, with 20 to 30 participants per cohort.
The organization has been focused on recruiting individuals from low-income communities, where the shortage of childcare providers is most critical. Hughes said that neighboring counties, like Merced and San Joaquin, have begun replicating their efforts.
Brooks said each new licensed childcare slot created generates an annual economic impact of $34,000. With 65 new businesses, which serve around eight children each, Nurture’s efforts have led to an annual economic impact of $17.7 million in Stanislaus County.
“Not only did we create jobs for them, but they are opening up opportunities for other parents to participate in the workforce,” Hughes said.
One entrepreneur’s experience
Adriana Segura started her childcare business in Patterson through Nurture over a year ago. She was planning on opening a daycare and was referred to Nurture by the Stanislaus Office of Education to help answer some of her questions about running a business.
While she was confident in her ability to care for children, her knowledge on business operations was limited. Nurture taught her how to properly document finances and expenses for tax deductions, among other essential skills.
She added that she can always reach out to her cohort or anyone at Nurture for support; they’re just a phone call away.
After working in a dental office for 10 years, Segura got interested in running a daycare after becoming a mom during the pandemic. She wanted to stay home and care for her children while working. During her search for childcare, she struggled to find the right provider for her own child.
“As a full-time working mother, I experienced how difficult it was to find a provider who felt like the right fit,” Segura said.
She said her business has been going well and she’s allowed herself to not say yes to every client who walks in, which has allowed her to build better connections with parents.
“I can confidently say that I am not just a childcare provider, but I am also a businesswoman, running a business that will be ready for growth,” she added.
Other challenges
Because the regional office of the state Department of Social Services, responsible for overseeing childcare licensing, is in Fresno, it has limited capacity to conduct inspections in Stanislaus County to get new centers up and running.
Hughes mentioned they’ve met with partners from the Lieutenant Governor’s office to discuss ways to improve the licensing process, which currently relies on paper forms and faxing and does not accept credit cards. This will hopefully “reduce the amount of time it takes to get the businesses off the ground,” she said.
Nurture also aims to address the misconception that childcare providers are unwilling to accept children with subsidies. According to the data they’ve collected, 75% of childcare providers in the county are, in fact, accepting children with subsidies.
Brooks also noted that while the county currently has enough subsidy dollars, the state will need additional funding to maintain the balance between supply and demand.
This story was originally published March 12, 2025 at 4:00 AM.
