Iowa will not receive $30 million in federal aid for child care

Still of Kelly Garcia from an Iowa Department of Human Services video.

The state of Iowa is losing $30 million in federal money that would have helped families access basic child care services.

The governor’s office says the loss of that money is the result of a deliberate decision to avoid having to commit $3 million in matching state funds toward child care.

But a Democratic state lawmaker says it’s her understanding that Iowa’s application for the $30 million in federal grants fell victim to the state’s inability to review the paperwork and submit it on time.

“It makes no sense to throw this money away,” said Sen. Claire Celsi, a Polk County Democrat. “It’s $30 million that we’re talking about … We really could have used that money.”

In September, the federal Administration of Children and Families announced the availability of $266 million in Preschool Development Grants. The money is intended to help states invest in early-childhood care.

The grant money can be used by states to coordinate early-childhood care and learning programs and services that already exist and help children from low-income families enter kindergarten prepared and ready to succeed in school.

This year, the grant-application process encouraged states to consider the changing needs of children and families due to the COVID-19 pandemic and to invest in strategies addressing those needs.

Having previously received funding under the same grant program, Iowa was one of 25 states or territories deemed eligible as “renewal” grant recipients.

Through an initiative known as Early Childhood Iowa, or ECI, the state of Iowa initiated a grant application process, hoping to secure a total of $30 million to be collected over a three-year period.

The application process calls for states to submit a letter on the governor’s letterhead designating the state agency that will have responsibility for administering the grant.

Reynolds’ office, however, didn’t provide the letter and declined to pursue the grant, despite recent assurances from federal officials that qualified applications were likely to be approved.

Celsi, who sits on the ECI board, said that last week she approached fellow board member Kelly Garcia, who heads the state agency that handled the application. Celsi said she asked Garcia why Iowa was giving up $30 million in badly needed federal money for Iowa families.

“Kelly claimed she did not receive the actual, filled-out application in time to review it,” Celsi said. “So, basically, a lack of time to review it was her explanation.”

Celsi said Garcia’s concern was that some aspects of the grant application would have obligated other state agencies to perform certain tasks and she wasn’t comfortable submitting the application without first checking with those agencies. Garcia felt there wasn’t time to do that before the Nov. 7 deadline for application passed, Celsi said.

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“I’m holding Gov. Reynolds responsible for this,” Celsi said. “She could not have kicked our child care providers in the teeth any worse than she did here by not really digging in and doing the work necessary to secure this grant.”

Alex Murphy, communications director for the governor, said that after reviewing ECI’s proposal for the federal grant, the governor’s office and “the leadership” of the Iowa Department of Health and Human Services “recommended using existing funds for some of the proposed projects rather than supporting the federal grant application.”

Murphy said acceptance of the federal money — which he described as $10 million over three years — would have obligated the state to provide $3 million in matching state money, with $1 million allocated for administrative expenses.

Celsi said she secured a commitment from Garcia that American Rescue Plan money will be used for the child care efforts the grant would have funded – but she said that means the ARP money will not be available for other initiatives.

The senator said she believes the $30 million was lost because state agencies are stretched too thin, with Garcia now overseeing the Iowa Department of Health and Human Services, which combines the functions of the old Department of Public Health and Department of Human Services.

“I asked Kelly Garcia, ‘Why didn’t you monitor the progress of this grant application, why didn’t you assign staff to it?’” Celsi said. “And she admitted that they’re overstretched — and I think there is no doubt about that. They are trying to do too many things all at once.”

Aaron Johnson, chairman of the ECI board and a citizen representative on the 25-member panel, declined to discuss the grant or any aspect of the board’s work when contacted by the Iowa Capital Dispatch. “I’m not the channel for that,” he said, adding that he’s unsure who speaks for the board.

The Des Moines Register reported earlier this week that the state of Iowa has refused to ask federal officials to reallocate millions in unspent federal money the state was awarded for rental assistance and affordable housing in Iowa. The decision means $89 million meant to help low-income Iowans with housing will probably be returned to the U.S. Treasury and then doled out to other states.

This article was originally published by the Iowa Capital Dispatch on Nov. 10, 2022. Clark Kauffman is deputy editor of the Dispatch.