Increase Revenues

Join the Child and Adult Food Program

The Child and Adult Care Food Program (CACFP) is a federal program that provides reimbursements for meals and snacks for eligible children enrolled in participating child care providers. Payments vary from $0.09 to $1.00 cents per snack, $0.33 cents to $1.97 for breakfasts, and $0.35 cents to $3.66 for lunches and dinners.

TIP This is a great way to cover your current food expenses or offer a new benefit to families.

Apply for the Families First Coronavirus Leave

Ends September 31, 2021 (can apply retroactively)

Owner or staff can qualify for paid time off (funded by the federal government) if: a) they need time off because they have COVID, are caring for a family member with COVID, or need to quarantine or b) if they need time off to care for a child out of school or care, even if the school is open for remote education.

Find more information about the FFCRA at indianaspark.com/civitas

Apply for the Employee Retention Tax Credit (ERTC)

Eligible businesses that kept W-2 employees employed through the pandemic can receive a refundable tax credit if the business: a) closed due to a local or state government order; b) decreased the number of children they can serve; or c) experienced a decrease in revenue from 2019 to 2020 or from 2019 to 2021.

TIP This can help you recoup funds lost as a result of the pandemic.

Find more information about the ERTC at indianaspark.com/civitas

Consider weekly vs. monthly billing

Many assume $1,000 per month works out to $250/week but some months have five weeks translating to an additional $1,000 per year per student with weekly billing.

TIP This can also speed up your collections.

• Transition to weekly billing for private pay

• Collect all parent co-payments on a weekly basis

Charge a registration or spot hold fee

Providing intake for new children takes time. Most centers (and family care providers can do this too) charge a minimal registration fee when parents apply for care, such as $50 per child. To hold a spot during a closure you may have a set fee or a policy such as using a security deposit or just continue billing.

• Update your parent handbook with a clear policy on closure and fees

Allow electronic transfers

Offer payment by electronic transfer apps such as Venmo, PayPal, Zelle, and CashApp.

TIP Parents love the convenience.

• Sign up for one or more electronic fund payment systems and provide the information to parents regularly

Have a collection policy and follow it

Have a clear policy on how long parents have to pay a bill and put it in your handbook.

• Develop a clear policy for collections and update your parent handbook

• Institute late fees

Market the cleanliness of your facility and use of required protocols (or more)

Families are currently driven by perceptions of safety. Share the changes you have made to avoid the spread of COVID.

TIP Parents don’t realize how much you are doing to keep children safe — let them know!

• Offer virtual tours to parents using your phone

• Ensure any ads or marketing materials include pictures of staff with masks and reference to adherence to all protocols

• Create a short video on the precautions you are taking for your website and social media

• Include your policies for health & safety (COVID-19 Addendum) in your Parent Handbook

• Have testimonials written by parents (video or written) made available on website/social media, etc.

Ensure you have a social media/web presence

Parents — subsidy or market rate — use the web and social media as a key resource. Websites can be built relatively easily on systems like Wix.com and Squarespace.com. Common social media platforms to be on are Facebook, Instagram, and Tik Tok.

• Create a web page emphasizing your unique selling points, how you are keeping children safe in COVID, and have a way to contact you and request a virtual or in-person tour or more information

• Be on at least one social media platform (if not more than one)

Ask your staff to refer families

Staff often know families with children of child care age. Additionally, you can offer an incentive for new families they refer to you.

TIP New families are most likely to trust the opinion of other families and friends.

• Ask staff and/or families for referrals

• Offer a small gift, amount of money, or tuition discount for families and/or who successfully refer your business

Reach out to other providers who are retiring or may be going out of business

Existing families will need care if their current providers close. They will appreciate a reference to a new provider and continued care (without interruption).

• Ask in your network of providers

Offer flexible learning and creative offerings

Consider offering flexible learning such as virtual music and movement/circle time/book readings, to families not quite ready to send their child for in-person learning.

TIP This is a great way to stay connected with your families who are keeping their children at home.

• Identify any additional/creative services you may provide

• Be sure to offer flexible hours

Take advantage of Build, Learn, Grow relief funding opportunities

Access additional funding through Build, Learn, Grow relief funding initiatives such as the Stabilization Grant. Learn more about available opportunities at brighterfuturesindiana.org/build-learn-grow/faq. For more information on effective spending strategies for your relief funds, visit indianaspark.com/civitas for resources and registration for a one-on-one business consultation.

Require pre-payment

For market-rate children, you can ask for one or two weeks of pre-payment. That is billing the families for care before you provide it.

TIP Cuts down the time needed to track down open invoices.

• Provide notice and begin to provide advance billing for market-rate children

Decrease Costs

Consider child care management systems

Child care management systems such as Brightwheel, Wonderschool, Procare, EZcare can help with billing, attendance, etc.

TIP Parents love how easy they can be.

• Identify any partnership allowing for discounting of a system

Use online accounting and payroll programs

Online systems such Freshbooks, Quickbooks, and Gusto can help with bookkeeping and payroll reducing the time needed.

• Add a bookkeeping and/or payroll system

Use a lower-rate credit card or balance

Many providers use credit cards to help keep their business going. The practice can lead to challenges, but if you are doing this, consider a lower-rate credit card or balance transfer to reduce the burden of interest.

• Research credit cards with lower rates or low/interest-free balance transfers

Defer or reduce payments for rent, utilities, and mortgage

Get help reducing your monthly housing payment or help with next steps if your housing situation has changed due to the pandemic.

• If you are a homeowner, learn about options to help repay amounts which were unpaid during forbearance, avoid foreclosure, or maintain your reverse mortgage

• If you are a renter, learn about options to avoid eviction, get rental assistance, and understand your rights as a tenant

• If the pandemic has caused you to lose your housing through foreclosure or eviction, there are resources available to help you transition to a new home and get a grasp your money situation

Look for recurring subscriptions to cut

Small monthly or other recurring costs can add up. Check your bank accounts and credit cards for recurring transactions you can live without.

TIP Many of these will be small amounts, but they add up quickly.

• Review your bills to identify subscriptions to cancel

Reduce Risks

Get help for Paycheck Protection Program Forgiveness

Space is Limited

Your Paycheck Protection Program loan is debt until you have it forgiven.

Be prepared if you have an EIDL loan

Some providers received the EIDL advance (the “free” money) and others also received an EIDL loan. The loans are NOT forgivable so will need to be paid back.

TIP If you received a notice from the SBA about a loan it is likely an EIDL.

• Reach out to the SBA to understand when you need to start paying and be prepared

• For assistance with navigating your EIDL loan repayment, schedule a one-on-one business consultation

Evaluate your federal tax returns

You can evaluate if your federal tax returns are consistent with best practices using the Confidence in Quality Tax Prep Rubric for Child Care Providers© developed by Luminary Evaluation Group.

• Use this rubric with your paid preparer to guide tax preparation, or, if you feel confident, use this rubric to help you submit your own returns

• Retroactively review past submitted tax returns. Providers can search for errors and amend returns for up to three years, receiving money back they overpaid in already-submitted returns

• For a free one-on-one business consultation on tax education to identify opportunities and risks this tax season, visit indianaspark.com/civitas to sign up

Have an up-to-date parent handbook

Many of the policies suggested in this technical assistance effort can be disseminated through a parent handbook. Having a clear, updated document will help manage parent’s expectations.

• Update your parent handbook (do you have one?). Include all parent payment requirements and other policies you create from other activities in it

• Have all families sign that they received and read the handbook — highlight the most important changes with a coversheet — so there are no surprises later

Consider free or low-cost ways to retain employees

Staff turnover can be disruptive to your business, as well as costly. Supporting your hard-working staff through challenging times can help to prevent disruptions in your business while relieving strain among your valued employees.

• Check in with staff regularly and keep open communication

• Reduce burnout by encouraging staff to take breaks or utilize paid time off

• Set regular schedules to allow staff to effectively plan around work

• Consider one-time bonuses or temporary wage increases (using relief funding is a great way to do this)

Need Help?

Register for a free one-on-one business consultation to review opportunities to increase revenue, decrease costs, and reduce risks for your business at indianaspark.com/civitas.

Disclaimer

The information contained here has been prepared by Civitas Strategies Early Start and is not intended to constitute legal, tax, or financial advice. The Civitas Strategies Early Start team has used reasonable efforts in collecting, preparing, and providing this information, but does not guarantee its accuracy, completeness, adequacy, or currency. The publication and distribution of this information is not intended to create, and receipt does not constitute, an attorney-client or any other advisory relationship. Reproduction of this information is expressly prohibited.