Child-development nonprofit pleads for financial help | February 24, 2017 | Palo Alto Weekly | Palo Alto Online |

Palo Alto Weekly

News - February 24, 2017

Child-development nonprofit pleads for financial help

Staff: Funding gap threatens subsidized care for low-income kids

by Elena Kadvany

Facing a financial crossroads, the Palo Alto nonprofit that provides subsidized after-school and child care services to more than 100 low-income families is asking the school district to cover in full what its leadership says is an unsustainable gap between rising costs and stagnant state funding.

Palo Alto Community Child Care (PACCC) manages Palo Alto Unified's child-development contract for the state, which provides funding to serve eligible low-income children. This year, 70 kids are enrolled using this state money (another 35 students are subsidized by the City of Palo Alto).

Providing these services as well as meeting administrative requirements of the state contract costs the child care agency close to $1 million annually, about half of which is covered by the California Department of Education, staff said. PACCC is now asking the school district to make up the remaining gap — $420,000 this year.

The nonprofit's costs have increased sharply since it took over the state contract in 2001, leadership has said. Minimum wage has doubled and the nonprofit has seen a 175 percent increase in health care costs, according to PACCC. While state funding increased between 2006 to 2008, the contribution has hovered between $420,000 and $550,000 since then. This year, PACCC will receive $515,000.

The shortfall also was compounded this past fall by an "unintended consequence" of the school district's shift to full-day kindergarten at all of its elementary schools, PACCC Executive Director Lisa Rock said in an interview with the Weekly. Families with kindergartners who were enrolled at the nonprofit no longer needed after-school care, resulting in a loss of $250,000, Rock said. The nonprofit's overall budget is about $10 million.

To mitigate the gap over the years, Palo Alto Community Child Care has increased its rates for full-paying families, paid its employees lower-than-average wages and, for the first time last year, dipped into its reserves.

Without a commitment from the school district to make up the budget shortfall, nonprofit staff said they will either reduce the number of families served by the state contract or put its management back in the district's hands.

"PACCC is at a crossroads," the nonprofit wrote in a recent request to the school district. "PACCC cannot continue to bear the burden of supporting the district's contract with the state."

But without PACCC, the children served by the state contract would have difficulty accessing quality preschool or after-school programs, according to the nonprofit's leaders. In this affluent community, their families occupy the lower end of the economic spectrum: The eligibility cut-off for a family of four is $42,200 in annual income.

In total, the 105 low-income families PACCC serves make up about 15 percent of the total 800 to 900, according to Rock. The programs provide children with homework help, enrichment activities and the chance to develop social skills and spend time with teachers and adults when they otherwise might be at home alone or with a parent whose first language is not English. And it is "well-researched," PACCC stated, that early intervention and education is key to narrowing the achievement gap.

"These children are not on a level playing field with their more privileged peers," Rock told the school board at a budget study session last Tuesday, when she, staff and PACCC board members asked for increased financial support. "These are our community's achievement-gap kids."

The programs provide academic and personal support for struggling families, staff told the board. Cipriana Morin Ramos, PACCC's financial-aid coordinator and manager of the state contract, recalled a family who recently lost their home and jobs, leading to a point when their children could no longer attend school. The nonprofit worked closely with the parents to get their children into an after-school program, "which allowed the family to get back on track," she said.

"This program is a beacon of hope to them, to the families," she added.

Over the years, the nonprofit has made up for the annual funding gap — initially between $140,000 and $175,000 — through fundraising and other adjustments, Rock said. The nonprofit already charges higher-than-average tuition when compared with other Palo Alto child care programs and has raised rates for full-paying families to help mitigate the state-funding shortfall. (Tuition is PACCC's main source of revenue, Rock said.)

This year, tuition for the after-school program ranges from $230 to $800 per month depending on the number of days a student is enrolled. The nonprofit's all-day preschool programs charge as much as $1,840 per month for five days a week.

It's become increasingly difficult to offer staff competitive pay, according to PACCC. The nonprofit pays its teachers about $18 per hour compared to an average in Palo Alto of $20 per hour, and its director earns about $56,000 annually compared to an average of $72,000 elsewhere.

Meanwhile, the agency has a waiting list of more than 100 families for the subsidized slots.

In addition to providing child care, overseeing the contract entails making monthly, quarterly and yearly reports to the state; handling billing and contract agreements with families; making sure the appropriate staff are meeting state requirements; and attending required meetings, Rock said.

The child care agency's request for support comes at a time of financial strain for the school district itself, which faces an ongoing, multi-million dollar shortfall.

Several board members indicated support on Feb. 14 for helping the organization. Board Vice President Ken Dauber said he is a "strong supporter of the idea that we should share the burden of this gap with PACCC" and asked staff to return at the next board meeting with an estimate of how much the district could contribute.

Member Jennifer DiBrienza acknowledged that shrinking the achievement gap is where the district is "weakest" and has committed to serious improvement.

"This is where all evidence shows is our bang for our buck," she said. "The earlier we intervene, the cheaper it is down the road for us and the more successful" students are.

Staff Writer Elena Kadvany can be emailed at


52 people like this
Posted by member
a resident of Community Center
on Feb 24, 2017 at 10:39 am

Early intervention, bang for buck - this is a prime example of a better area to fund than changing names of Jordan, Terman, and Cubberly!

32 people like this
Posted by Jared Bernstein
a resident of Professorville
on Feb 24, 2017 at 11:10 am

PACCC is a valuable community resource. It deserves support.

32 people like this
Posted by Penny
a resident of Greenmeadow
on Feb 24, 2017 at 11:17 am

This would be money well spent. Please do it.

18 people like this
Posted by Addison Parent
a resident of Community Center
on Feb 24, 2017 at 11:24 am

Add this to the cost of Full Day Kindergarten, which now looks to be up to $1 million a year. It takes revenue away from PACCC, which then comes to the district to be made whole. If PACCC stops performing the state contract, that will increase the achievement gap. Another great idea brought to you by Max McGee!

28 people like this
Posted by Another Addison Parent
a resident of Downtown North
on Feb 24, 2017 at 11:52 am

PACCC is an amazing organization providing quality child care AND pre k. Both of my children attended these programs and their experiences were extraordinary. I was not even aware of the state contract or the DEEP waiting list for these services. Step up PAUSD, this is where you will see a difference!

14 people like this
Posted by Native to the BAY
a resident of Fairmeadow
on Feb 24, 2017 at 12:38 pm

An an amazing program. One of the reasons I was able to return to the place I was born and raised! These types of programs nuture and care for our community for years to come. Our less than fortunate resident children deserve no less! And too any help from the Silicon Valley Community Foundation? Saving in all kinds of ways is priceless!!!!!

8 people like this
Posted by PACC Supporter
a resident of Fairmeadow
on Feb 24, 2017 at 1:37 pm

Let's stop the "me too" raises for administrators. They might think twice about giving raises if their salary was not part if the "deal". (If I authorize a raise, I get one too. Yeah for me)

7 people like this
Posted by Richard
a resident of Fairmeadow
on Feb 25, 2017 at 3:53 pm

I really can't say enough good things about PACCC and in particular BBKC where my kids thrived in their after school program. Dedicated professional staff and a terrific program. My kids really missed the teaching staff, activities, and BBKC community when they moved up to Middle School, I did too.

I sincerely doubt PAUSD could manage the contract half as well as PACCC, would likely further add to the cost with unnecessary layers of PAUSD overhead, and almost certainly, the kids would be the losers. This seems like an easy decision for PAUSD; pay PACCC to fully implement the state contract, or pay more, and probably get much less, by getting the contract handed back to them.

Like this comment
Posted by Just me
a resident of Adobe-Meadow
on Feb 25, 2017 at 4:49 pm

Or pausd can drop the contract and try to shame the state to pay what it costs to deliver the service in Silicon Valley. If pausd makes up the $400k paccc shortfall, 3 teachers get fired. Do you think that's the better choice?

3 people like this
Posted by member
a resident of Adobe-Meadow
on Feb 25, 2017 at 10:35 pm

PACC didn't anticipate or plan for Palo alto full day kindergarten. that is a management error.
This non-profit already gets $515,000 of our tax dollars.
Two suggestions:
1. Look at management and its error in planning for the future;
2. Look at more rigorous fund-raising as other non-profits do.
3. Publish full expenses and income as a non-profit so that potential donors can see how well this is managed.

No reason to put more tax dollars into a non-profit at this time. Fiscal management seems to need buttressing.

PAUSD already has serious fiscal issues that were unexpected: I expect that the Board and Supervisor will rectify this quickly and prevent this from happening again.

It would be irresponsible for the PAUSD to give the requested $400K plus to an outside agency when PAUSD is facing fiscal constraints.

Like this comment
Posted by john_alderman
a resident of Crescent Park
on Feb 25, 2017 at 11:07 pm

john_alderman is a registered user.

@ member - They are a non-profit (501c3)and they do publish full expenses, income, etc.. Just go google their 990.

It is a great, well run organization, but I hope it helps people realize that the "affordable" care act has made health care unaffordable, and the minimum wage is zero when you can't afford to hire people.

2 people like this
Posted by BBKC parent
a resident of South of Midtown
on Feb 26, 2017 at 7:35 am

My daughter goes to PACCC (BBKC) since kindergarten. We love the program because of its great teachers, fun programs and its location. We actually are planning for our 2nd child attending BBKC when he is in kindergarten. We have no idea that PAUSD made the change of full day kindergarten. This is a real serious issue and it will be terrible if PACCC has to leave because of this reason.

Btw, I can testify the long waiting list of the pre-school program. We waited for more than 1 year and eventually had to go to a pre-school in Mountain View.

6 people like this
Posted by Elena Kadvany
a resident of another community
on Feb 26, 2017 at 10:59 am

My name is Elena Kadvany; I'm the Weekly's education reporter. I'm working on a broader story about affordable childcare in Palo Alto and am looking for current or past PACCC families to speak with. If you are interested in talking with me for this story or might know other parents with children in PACCC programs, please email me at Thanks very much!

9 people like this
Posted by PA Parent
a resident of Fairmeadow
on Feb 27, 2017 at 2:25 pm

Our family also deeply appreciates the BBKC staff and program. The full day kindergarten idea was brought up and implemented far too quickly, with no time for an organization like PACCC to react. While I think Max McGee has done a good job in other areas, he should have taken the time to understand our district and the work that PACCC does before forcing full day kindergarten on the district.

It is also a bad idea to redirect so many of our resources to kindergarten when that population is shrinking and there is a bubble of students going through our very large middle and high schools.

Sorry, but further commenting on this topic has been closed.