TRENTON — Under pressure from the business community, a bill that would allow public school districts to operate child care centers has been scaled back, permitting only a few districts to join a pilot.
The bill has been criticized for pitting school districts aiming to use extra space to generate revenue against tax-paying private businesses.
It would permit public schools to operate child care centers through a Board of Education, non-profit or for-profit provider under a limited, five-year pilot, with public districts selected by the commissioner.
It also would impose Department of Children and Families licensing requirements, the same as private child care centers.
The bill was inspired by Teddy Bear Academy, a school-district-supported day care in Evesham that was the subject of a battle over the legality of such centers. Evesham is among the districts eligible for the pilot, which also include Ridgeway, Toms River, Piscataway and Barnegat, and potentially Ridgewood. Those districts operate child care centers in a legal gray area.
None are licensed with the Department of Children and Families, which licenses private child care centers.
15 to join pilot
According to the bill, the pilot will include “all community providers operating in a public school facility” as of its passage.
After five years, a study would “take a hard look at the positive or negative effects on independent care providers, school districts, parents and most importantly, the children,” said Assemblywoman Patricia Egan Jones of District 5,testifying recently about the changes to the Assembly Women and Children Committee. She identified eligible districts, including nine vocational schools.
Open to residents and nonresidents, the public facilities would charge participants tuition “within the range” of other licensed centers in the county. Revenue generated beyond the costs to operate will go into a district’s general fund.
Assemblywoman Nancy Munoz of District 21, in a vote against the bill, said public districts had a financial advantage over private businesses, and called it a “slippery slope” writtenlargely for the five towns currently operating centers.
The Senate and Assembly will vote on the amended version of the bill, A5066 in the Assembly and S3330 in the Senate.
Opposition to bill
The bill has drawn opposition from businesses. It would “directly pit the public schools against private child care centers,” said the New Jersey Child Care Association in a public letter. The non-profit represents owners of licensed child care centers.
“Child care programs operated by school districts will unfairly compete with the private centers because school district centers will not pay necessary expenses like mortgages, real estate taxes and income taxes, in addition, expenses like utilities, insurance and maintenance for the school board facilities are tax-subsidized,” said Joseph Marrazzo, co-owner of Under the Sun Learning Center. The center brought the initial lawsuit against Teddy Bear Academy.
Guy Falzarano, founder of the Lightbridge Academy franchises and vice president of New Jersey Child Care Association, said when the Piscataway public school district opened Children’s Corner in an empty parochial school, “They undercut everybody in the market.”
“One of my centers went out of business as a result of it, and that’s what happens with open space,” he said.
Piscataway officials expressed support for the bill.
“My experience here in Piscataway is that for-profit day care programs do not readily accept children of limited means, those who present challenges and those families whose first language is not English,” said Kim Georgeian, director of community programs.
Piscataway provides free, full-day preschool for low-income families available through a $1.8 million state grant. The district’s tuition rate is “reasonable” for families who couldn’t put their children in private day care, said Colleen Pongratz.
Several speakers at the hearing noted the impact on women-owned and women-staffed businesses.
Boosting district coffers
Teddy Bear Academy generates “six figures” in revenue at a time when Evesham lost about $8 million in state aid, said Evesham Board of Education member Janis Knoll.
That loss of state aid is one of the reasons the New Jersey School Boards Association was in favor of the bill, said Legislative Advocate Christopher Jones, calling it an effort to “curtail property taxes.”
“At the end of the day, this is about providing options,” Jones said.
Child care professionals expressed concerns with public centers operating with the purpose of supporting school budgets, but Knoll says she is “skeptical” district-run day care would put others out of business.
Two for-profit centers have opened nearby and one is pending since Teddy Bear Academy launched, meaning there is still room for competition, said former Evesham school board member Rosemary Bernardi.
In the Ridgewood district, where the tuition-based Infant Toddler Development Center serves residents and non-residents ages 6 weeks through 4 years, there’s hope the pending legislation will clear up legal ambiguity.
Superintendent Daniel Fishbein said Ridgewood is interested in joining the pilot.
“We are moving forward with our ITDC program,” said Fishbein. “We have no issue with complying with the license requirements of the NJDCF.”