Unexpected deficits may cause the Glendale Unified School District to end its participation in an innovative child-care program founded jointly by the district, the city and three private firms.
The school board is expected to vote Tuesday to withdraw from the Glendale Employers Child Care Consortium, which has run up a $49,000 deficit after only nine months of operation, said Georgia McAninch, Director of Child Development Centers for the school district.
"Unless there's some sort of miracle, we will definitely recommend the school district pull out," McAninch said. "The reality is we are not breaking even on a monthly basis. In this time of tight money, the school district can't subsidize the program."
Founded in January by the school district, the city, Glendale Memorial Hospital, Verdugo Hills Hospital and Glendale Federal Savings & Loan, the consortium was intended to be a cooperative venture into quality child care by private and public employers.
The school district took responsibility for managing the program, incorporating it under its Child Development Centers branch, which runs 15 day-care centers throughout the district.
High Cost, Low Enrollment
One of only a handful of public-private child-care ventures in the state, the program has been burdened by low enrollment and high labor costs for its highly trained staff members.
The district's withdrawal would force the other partners to find a new operator, Consortium Board Secretary Beth Gardner said. The remaining partners are committed to continuing the program and will consider inviting other Glendale employers to join, she said.
Consortium board members said this week they hope to find another quality operator at less cost.
"We have to look for another operator that does not have to pay the wages and benefits that the school district does," Assistant Glendale City Manager Dave Ramsey said. "We are concerned about the deficit, so we are looking at how best to continue operating the center."
The center, at the North Glendale Methodist Church, 1015 N. Central Ave, has facilities for 90 children, but only 55 have enrolled. Two thirds of those children are infants and toddlers who, under state law, require twice as much staff supervision as preschoolers.
"Our early plans and budget were based on the idea of having just the opposite ratio," McAninch said. "Now that ratio is reversed, and it's much more expensive to care for those kids than we originally thought."
School officials said the quality of care the program provides could diminish under new management. The school district is required by the state to meet a higher standard of care than private centers, said Carolyn Stelter, a program supervisor for the district's Child Development Centers. School district employees must complete almost twice as many training hours as private employees and have at least two years of experience, she said.
Don't Want Change
Some parents of children in the program said they are concerned about any change of management.
"If the school district pulls out, we're going to lose the great people who have been working with our kids," said Greg Cook, a La Crescenta resident whose 10-month-old son, David, has attended the center for seven months. "I am real concerned, and I know other parents are too. We'll be watching the situation real closely."
When the program began, each consortium member contributed $20,000 in cash or services. The city of Glendale contributed $8,000 in cash and found a site for the center, the school district contributed its adminis
trative services and the three private corporations contributed their entire share in cash, Ramsey said.
The district hired the program's 11 employees, ordered equipment and managed the program without charging administrative fees. The program's employees, however, are paid by the consortium.
Staff salaries, rent and insurance costs have all contributed to the deficit, Gardner said.
The program has cost an average of $22,000 a month to run, Stelter said. The monthly deficit varies with enrollment figures, she said.
District Given a Break
The partners have agreed to exempt the district from $30,000 of the deficit, Gardner said.
"We all decided that the district's administrative costs and their in-kind contributions came to more than the $20,000 they bargained for," Gardner said. "They really worked hard."
All consortium members will share equally in any additional deficit until the district withdraws, she said. The district estimates that the program will incur another $30,000 in red ink by the end of December, according to a report submitted to the school board in September by Supt. Robert Sanchis.
The school's share of the deficit will be paid out of the district's child-development fund and will not encroach on general school-district funds, McAninch said in the report to the district.
She said she expects the district to pull out of the consortium completely to avoid subsidizing future deficits.
Fear of Possible Deficit
"We don't want to be responsible for any deficit that might be incurred in the future, if the new operation has problems," McAninch said. "It's an unknown and the board is not willing to deal with an unknown."
Employees of consortium members pay $85 to $115 a week for the consortium's day-care services, McAninch said. The fees charged the rest of the public are slightly higher, she said.
The Child Care Consortium is modeled after a 3-year-old consortium in neighboring Burbank. The Burbank consortium has faced similar financial problems, running up a deficit of more than $453,000 since 1984. But, in August, the Burbank Unified School District voted to continue the program despite its costs.