Early Care and Education: LIIF Scaling Solutions via New Business Plan 

LIIF is recognized as a national leader and advocate for the early care and education (ECE) sector. What started a quarter century ago as a partnership with the City and County of San Francisco has burgeoned into a national model. Today, LIIF supports the building, expansion and improvement of facilities, further deepening our investment to ensure that quality child care is affordable and accessible for all families.  
 
LIIF is addressing supply gaps in the sector with our new ECE business plan, a comprehensive approach centered on facilities fund management, capacity building and advisory services. LIIF is uniquely positioned as a community development financial institution (CDFI) best equipped to execute and attain its ECE goals, with a stellar ECE executive leadership team and over 50 full-time employees dedicated to supporting small, predominantly women-owned businesses to build capacity and preserve and expand the supply of child care across the country.  

Much of this growth was in response to states like California that dedicated COVID relief and other funding to address needed ECE facility repair, renovation and expansion. The state needed its $350 million Infrastructure Grant Program (IGP) to be effectively managed and deployed. California knew of LIIF’s community development work in the state, plus our organization’s ECE facilities fund management expertise. This program, the largest of its kind in the country, is helping providers weather the dire impacts of the pandemic, extreme weather events and years of deferred maintenance due to lack of funding. 

LIIF understands that investment in ECE is fundamental to advancing racial and gender equity for providers and low-income families. ECE providers, many of whom are women, especially women of color, have a huge impact during the key developmental stages of a child’s life. Unfortunately, they often work with limited resources, space and support, which creates challenges in providing high-quality care and education.  

In FY23, LIIF deployed 1,800 grants to providers, 79% of whom identify as Black, Indigenous or people of color (BIPOC). LIIF’s impact is evident through our unwavering support of the ECE sector, through robust grantmaking and technical assistance aimed at fostering the growth, expansion and revitalization of facilities, thereby empowering these communities and nurturing children and families. 

The Bank of America Institute released new data that showed a 32% uptick in child care costs since 2019, often leaving parents with impossible choices like spending outside their budget, finding cheaper, less desirable care situations or leaving their jobs to take care of their children.  

Although the pandemic amplified the need for the ECE sector and the critical federal funding it received, the ECE sector faces a significant funding gap as pandemic-era grants expired last September. More than 220,000 ECE programs in the U.S. received federal financial support to help alleviate costs, make needed improvements and raise wages for staff during and after the pandemic. The temporary aid amounted to $24 billion, which provided a much-needed lifeline for both center-based facilities as well as family child care homes. However, now that this funding has expired, many child care centers struggle to maintain their services and retain qualified staff. This funding gap threatens the accessibility and quality of child care, posing a significant challenge to working parents and the broader economy. 

As a leading CDFI, LIIF continues to be a resource to the sector, providing solutions that support providers, families and children. To date, LIIF has impacted more than 353,000 children, primarily driven by our work in California, Georgia, New York and Washington, D.C., as well as our support in deploying and administering COVID relief funds.  

In Atlanta, our impact continues to expand via our partnership with Promise All Atlanta Children Thrive (PAACT), the City of Atlanta and Reinvestment Fund supporting ECE programs. The partnership uses $3.8 million of the City of Atlanta’s American Rescue Plan Act (ARPA) funds to offer up to $75,000 for needed repair and renovation projects serving low-income 0- to 4-year-olds. Using public funding to enhance the quality of ECE facilities represents not just an investment in children, but also a commitment to families, communities and our future. This investment not only bolsters the ECE sector, but also empowers the families we are dedicated to supporting, setting the stage for a brighter, more promising future for people, regardless of their ZIP code, socioeconomic status or race.  

In New York City, LIIF supports licensed family child care providers, through our newly launched TA Hub. Partnering with All Our Kin, ParentChild+ and Ramapo for Children the officially named Family Child C.A.R.E. NYC is a comprehensive online resource that offers free, culturally responsive technical assistance (TA) in any of the five boroughs of New York City. This resource was created to focus on family child care providers who are mostly women of color, live in and serve historically excluded communities. This comprehensive set of supports helps their business thrive, improves the marketability of their program, and enables more children and families to access quality care and education. 

Across the country, families face increased housing and ECE costs, often due to limited supply in both sectors. This is why LIIF aims to expand the availability of affordable, high-quality child care within housing developments: to offer a substantial opportunity to simplify family’s lives, promote healthy child development, and advance climate and economic development objectives. We know that by co-locating homes with ECE facilities, parents spend less time commuting by car, reducing household carbon emissions and freeing up time for parents and children to spend in their communities. For example, in Oregon, LIIF and three other CDFIs — Craft3, Micro Enterprise Services of Oregon and Network for Oregon Affordable Housing – launched Build Up Oregon to create or preserve spaces to serve 600 children by supporting co-location with affordable housing developments.   

With 25 years of deep work in ECE, LIIF looks forward to the next 25 years of partnering with the public and private sector to ensure small ECE businesses that are anchors in our communities can thrive. A new and important focus in our work is climate mitigation and resilience, because young children are disproportionately affected by extreme weather brought on by climate change. We strongly believe we must protect young children and their families  and provide them with a future filled with opportunity.  
 
LIIF’s ECE work is scaling up, with an expanded geographic presence to drive more impact across the nation. Based on the impact shown in FY23, LIIF’s dedication to ECE transcends financial support; it symbolizes a commitment to the future — a future where every child has access to quality child care. LIIF’s work exemplifies the power of collective efforts in advancing equity, opportunity and well-being for all. As LIIF forges ahead, our commitment to ensuring equitable access to quality child care remains steadfast and unwavering.