Faced with the challenges of depending on an unreliable funding partner in the state of Illinois, a nonprofit North Side social service agency is taking an entrepreneurial approach to its future survival.
Concordia Place, which serves low-income and working families with a variety of programs in the North Center and Avondale neighborhoods, is opening a new child care center in Ravenswood.
Concordia Day will charge market-rate tuition to area families looking for a high-quality early learning option for their infants and toddlers, with the expected net revenue to be used to help underwrite subsidized programs at the agency’s two other locations.
“It is our long-term solution to the state’s financial volatility,” Concordia Place President and CEO Brenda Swartz told me Tuesday at a ribbon-cutting for the new facility at 4809 N. Ravenswood.
Swartz is banking on socially conscious parents being willing to pay top dollar for Concordia’s well-regarded child care program in the knowledge that they also will be helping low-income families who otherwise might not be able to afford it.
“I think our social enterprise model will appeal to this new generation of parents, who like to do business with organizations that are more than their ‘product’ and offer a social mission,” she said.
If it works, and I don’t underestimate the obstacles, I could see this “social enterprise” approach being adopted by other agencies trying to make ends meet in an era of state fiscal austerity.
Concordia Place was one of many child care providers hit hard last year when Gov. Bruce Rauner slashed eligibility for the state’s Child Care Assistance Program.
Nearly half the families in Concordia Place programs at 3300 N. Whipple and 3855 N. Seeley qualified for child care assistance. One-third paid market rate tuition with the rest charged on a sliding scale depending on their income.
Although Rauner eventually reversed himself and limited the cuts, the damage was done. Many families pulled out of child care and never came back.
Coupled with the long delay before Rauner and lawmakers agreed on a state budget that halted or postponed payments, many providers were forced to close their doors or cut staff.
“This has been a very tough two years,” Swartz said. “We had the rug pulled out from under us.”
Concordia Place weathered the storm, but sees more dark clouds ahead as the state limps along on a six-month budget without the increased tax revenue that even Rauner admits will be necessary.
Swartz said the anticipated $100,000 annual proceeds from Concordia Day — in excess of the cost of delivering the service — should help smooth out the turbulence.
Concordia Day will open with slots for 47 children ages 6 weeks to 3 years old. Unlike at the other locations, all of their parents will be charged full freight, ranging from $2,115 a month for infants to $1,635 for 2- and 3-year-olds.
“This is a community where the demographics support that,” Swartz said.
The center, which is set to open Aug. 8, will have four classrooms, two with cribs for the babies.
“This isn’t just babysitting. Our teachers have degrees in early childhood education. There’s a curriculum,” Swartz said, drawing a distinction between Concordia and your run-of-the-mill day care program.
The Rev. Nicholas Zook, pastor at Concordia Lutheran Church and board chairman of Concordia Place, said the organization hopes to open two more centers using the same market-rate model by 2020.
The proceeds will support not only early childhood programs at the other locations but also programs for teenagers and seniors, he said. Concordia Place says it serves more than 800 individuals a year, many at low or no cost.
Not every social service provider can find a way to generate private-sector revenue, but every one that does deserves to be encouraged.