Child Care Stabilization: When Government Funding Gaps Widen, Who Steps in to Keep Child Care Afloat?

As the government shutdown reverberates across communities, one of the quieter, but deeply felt, impacts is on early child care. Providers are likely to face shortfalls in subsidy payments, delays in reimbursements, and greater uncertainty about contracts and grants. In times like this, the stability of families, children, and care providers is threatened.

Here’s what we are seeing, and doing, through our work in Pittsburgh’s East Side, in partnership with Duolingo Early Learners First.

During this period of federal pause, we can identify at least one consistent force: corporations who have made a lasting commitment to education.

• Duolingo has been a critical partner in supporting East Side child care providers, helping with bridging funds, capacity support, and logistical coordination.

  
  

• This kind of corporate‐community partnership is not just generous, it’s a signal: in fragile funding ecosystems, private actors often become de facto safety nets for public good.

  
  

• But corporate support is not a structural substitute, it’s a stabilizer. The deeper work remains building resilient, diversified systems of support for care.

Why Funding Diversification Matters for Child Care Providers

If one revenue stream falters (e.g. state or federal subsidy), child care businesses cannot shoulder the full burden. To survive, and to serve equitably, providers must cultivate multiple streams. Here are strategies we recommend in our business coaching work:

Sliding fee scales and tiered tuition models 

• Adjust pricing (within reason) so that some full-pay or partial-pay families help cross‐subsidize slots for lower-income families.

  
  

• Be explicit about mission and equity goals so community members understand trade-offs.

  
  

Local philanthropy and mission-based grants 

• Build relationships now with local foundations, corporate giving arms, and community donors. 

  
  

• Share your stories grounded in the lived experiences of children, families, teachers.

Membership / sponsorship models 

• Businesses, alumni, or community groups can “sponsor” a slot or classroom to ensure that slot remains open regardless of subsidy delays.

Reserve or stabilization funds 

• Even modest reserves (e.g. 5–10 % of monthly operating costs) can buy breathing room during funding lags. 

  
  

• Use thoughtful budgeting to build toward a multi-month buffer.

  
  

Collaborative networks and pooled purchasing 

• Providers banding together to share administrative services, bulk procurement, joint training, or centralized back‐office functions can lower costs and spread risk.

Why This Matters—Beyond Business Survival

• Children lose consistency. When a provider cuts back, delays opening, or closes entirely, children face disrupted routines, lost relationship time, and developmental risk.

  
  

• Families lose access. Especially working families whose schedules rely on dependable care, wages, job retention, and well-being are jeopardized.

  
  

• Teachers and caregivers suffer. Pay, employment stability, and morale all erode when funding is volatile.

  
  

• Equity gaps widen. Systems that already marginalize low-income, Black, Brown, and immigrant communities are hit hardest by cuts and delays.

  
  

Call to Action: What Can You Do?

(as a Reader, Funder, or Corporate Partner)

• If you represent a corporation or business: consider sponsoring a “stability grant” for child care in your community.

  
  

• If you’re a funder or foundation: invest in multi-year, flexible support (not just project grants).

  
  

• If you’re a policymaker or advocate: spotlight child care as infrastructure, stress the human cost of shutdowns, demand policy safeguards for payment continuity.

  
  

• If you’re a community member: voice support, advocate, donate locally, and hold public systems accountable.

Our partners and providers are not asking for charity, they’re asking for sustainable systems. The government shutdown reveals a harsh truth: when public systems flicker, children’s futures should not. We are proud to stand with Duolingo Early Learners First and East Side child care providers in this moment, to stabilize, to learn, to innovate. But long term, we must design a child care infrastructure that does not tremble at every fiscal crisis.

If you’d like to learn more, to partner, or to explore how revenue diversification strategies might work in your context, let’s talk.

— Dr. DaVonna Shannon, Executive Director, Early Excellence Project