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NYC childcare providers say city contract rates fall $12.6K short per child
By
Karen Yi
Published Sep 28, 2026
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By
Karen Yi
Published Sep 28, 2026
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Public preschool providers say they’re losing teachers to better-paying jobs, running up debts and having to pay out of pocket because their city contracts don’t pay them enough.
“ We do not have enough funding to pay staff, teacher assistants, teachers a livable or even a competitive wage,” said Robert Cordero, CEO of Grand Street Settlement, which runs several childcare programs across the city.
Childcare providers and their advocates say fixing the pay rates is crucial as Mayor Zohran Mamdani’s administration delivers on its promise of universal childcare. This year, payment delays marked the start of Mamdani’s inaugural 2-K program. Providers say the city doesn’t just need to fix its late payments but increase those payments, too, or else it’ll be hard to recruit enough workers to make free childcare available to all.
In a report released this week, United Neighborhood Houses, a membership group representing social service organizations offering childcare services, estimated the funding gap between what the city pays providers and what a center-based program costs to operate at about $12,600 per child. While costs can vary by program size, location and program type, that calculation was made using higher salaries for teachers, additional support staff to cover for when teachers are out sick, more money for food and social workers.
“ If we don't address some of these underlying issues, 2-K expansion is going be a lot harder, because I don't know how many more providers are going to want to open up new classrooms, how many new people are going to want to come into this business if they can see very clearly, it's not solid wages,” said Nora Moran, director of policy and advocacy at United Neighborhood Houses, a membership group representing social service organizations offering childcare services.
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Join WNYC's All Things Considered for a live event on Sept. 30 focused on childcare affordability. The event will feature parents, childcare providers and policymakers, to explore solutions that can help families stay and thrive in New York City.
The event takes place at the Snug Harbor Newhouse Center for Contemporary Art on Staten Island. Doors open at 6:30 p.m., and the event begins at 7 p.m. Tickets are free, but registration is required. For more information and to register, visit wnyc.org/events.
City officials said Mamdani invested $40 million to increase contract rates by 2% for center-based providers and 5% for providers who care for kids in their homes this year but acknowledged there was more to be done.
“This work is far from finished,” spokesperson Jenna Lyle said in a statement.
“As we build a truly universal childcare system, we will continue to invest in the providers who make that system possible and the families who depend on it. Because New Yorkers should never have to choose between childcare they can afford and childcare that is properly funded. We can, and we must, deliver both.”
Childcare centers said most of their contracts were first issued in 2019 and 2020 — and their rates have largely remained frozen even as rent, insurance, food and staffing costs have risen. Some providers, like Children’s Aid, have to privately fundraise to pay for the cooks who make meals for the kids or to give their teachers raises to keep them coming back.
Pay parity
Providers said the biggest gap in city funding is driven by how much they can pay their workers. Some said they frequently lose their teachers, particularly those with bachelor's or master’s degrees. Teachers with the same credentials employed by the city’s Department of Education, where they only work the length of the school year, can earn substantially more.
Those pay parities make it hard to retain and recruit teachers. It can also be hard to find workers to fill lower-paid positions like cooks and classroom aides.
“ We train them, we invest in them, and then after two, three years, we may lose them to the public school system, which pays more and has a different set of benefits,” said Cordero from Grand Street Settlement.
Debra Sue Lorenzen, director of youth and education at St. Nicks Alliance, which cares for about 80 children, said four of her five teachers with a master’s degree left her center-based program to work for Department of Education preschools, where they work fewer days and earn $40,000 more.
“ It's not really a difficult decision to make. Of course you're gonna leave. You've got to pay out your student loans. You've got your own children to raise,” she said.
Stretched thin
Providers who serve low-income populations say they often don’t have enough funds to hire a social worker or someone who can help families navigating difficult situations such as housing issues, domestic violence or unemployment, or families who have a child with special needs.
“Everything is stretched in order to protect what's most sacrosanct to us, the quality of the instruction in that classroom. But what you lose is the access to the wraparound services and the support services that children need,” said Cordero.
“If you're gonna stabilize a child, a child's life, you have to start with the parents.”
Linda Indelicato, who runs a center-based program on Staten Island, said she pays out of pocket to hire additional staff to help toddlers who have special needs.
United Neighborhood Houses said their model budget includes city funding for social and family workers, putting the cost per child at $34,500.
”If we are really committed to creating a quality, durable, universal system that's going to last, here's the pieces that we think need to be funded and the things that need to be addressed,” Moran said.
Clarification: The headline on this story has been updated to clarify that childcare providers say their contract rates are falling short.
Tagged
childcare
economy
new york city
Karen Yi
Karen Yi covers homelessness and poverty. She joined the WNYC and Gothamist newsroom in 2020. Before that, Karen covered Newark for the Star-Ledger and spent almost a decade working for newspapers in New Jersey and Florida. She grew up in Miami and has a dog named Cashew. Got a tip? Email [email protected] or Signal 917-589-1460.
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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