Federal funding freeze creates chaos for Wisconsin Head Start programs
It took some Wisconsin Head Start programs two weeks to get their funds after the Trump administration rescinded its freeze on federal grants and loans.
On Jan. 30, Jen Bailey, the executive director of Dane County Head Start operator Reach Dane, woke up to a negative balance in her organization’s bank account.
Reach Dane is one of many groups in Wisconsin that operate services under Head Start, a federally funded early childhood education program that provides care for low-income families across the country.
President Donald Trump’s administration released a memo on Jan. 27 freezing all federal spending already authorized by Congress. After Wisconsin Attorney General Josh Kaul and 22 other state attorneys general sued, the administration rescinded the memo but maintained its commitment to withholding federal funding on Jan. 28. A federal judge in Rhode Island granted a temporary restraining order blocking the freeze on Jan. 31, and the U.S. Court of Appeals for the First Circuit upheld the order on Feb. 11.
Despite the court order, Bailey, who is also the president of the board of the Wisconsin Head Start Association, said Head Start programs in Wisconsin didn’t have full funding until Feb. 10, almost two weeks after the freeze was rescinded.
Because Head Start is a reimbursement program, organizations can’t request funding in advance; they have to submit requests as their expenses occur. In order to cover payroll for the end of January, Reach Dane had to take out a line of credit.
On Jan 30, Bailey told the Wisconsin Independent, she was worried about costs adding up amid the uncertainty over federal funding.
“Of course, now we’re worried. It’s almost the first of the month. We have rent and mortgage expenses. We have health insurance expenses. Not knowing how long this might continue, how long these delays might last, is very hard,” she said.
By the time its funding was restored, Reach Dane had had to take approximately $500,000 out of reserves to make ends meet, Bailey said during a follow-up interview on Feb. 11.
On top of that, Bailey said, there was virtually no direct communication from the government during the crisis.
“The only pieces of information that we know is what we see on the news and from watching the White House press conferences,” she said on Jan. 30. “We all woke up Tuesday morning and very quickly realized that this was a national-level issue, but that was only by networking and talking with each other.”
After the freeze ended, Reach Dane was forced to jump through extra hoops before it could get its funding back. The federal payment system flagged the organization’s requests for review, and the group was only given an hour to provide additional information.
“This is not anything that has ever happened before in my 25 years,” Bailey said. “So, still not sure what that was about or the reason for the flag. I haven’t heard of any other directors that have had their request flagged yet, so I think we’ll have to see how that goes moving forward.”
Reach Dane wasn’t the only organization affected. At least eight organizations had difficulty accessing funding, and at least one had to temporarily shut down during the freeze, according to Democratic Sen. Tammy Baldwin’s office.
For many of the families that rely on Head Start, losing access to the program would amount to a crisis, Bailey said.
“Most of the parents that are enrolled in our program, they’re working families, and for the most part, they’re working in the service industry. So they’re working fast food, retail, cleaning companies. And they don’t tend to have jobs that are super forgiving of being absent,” she said. “So if we aren’t there to provide child care for them so they can go to work, their employment is at risk pretty quickly.”
Overall, Bailey said, the situation has left Head Start administrators across Wisconsin feeling shaken.
“I think we’ve all been making our continuity-of-operations plans,” Bailey said. “Because for many programs, if you’re drawing down for payroll and you don’t have any reserve, that becomes a crisis really fast when you don’t get that funding.”
The situation may be resolved for now, but Bailey said she and other administrators are concerned about funding in the future.
“We’re crossing our fingers and toes that the system continues to work, and we’re pretty worried about the prospect of the federal government shutting down in March,” she said. “And normally, I would not be concerned, because our funding has already been obligated to us and awarded by Congress. However, given what’s just happened, I think we’re all feeling nervous about what might happen in March,” Bailey said.
The federal government will run out of money on March 14 unless the Republican-controlled Congress can reach a budget deal.
