The Army's child care fee subsidy program is in such disarray that many families are experiencing financial hardship — some forced to deal with collection agencies for unpaid bills from child care providers, some filing bankruptcy, and some spouses being forced to quit their jobs or stop their education, according to a new report issued Tuesday.
The General Services Administration's inspector general said GSA "failed to plan adequately for the expanded program" when it took over the Army program and added more than 9,000 Army families to GSA's previous caseload of 200.
Previously, the Army child care fee subsidy program was managed by contractor Child Care Aware, a nonprofit organization that continues to manage similar programs for the Navy, Marine Corps and Air Force. Information was not immediately available about whether the Army is paying less for the administration of the fee subsidy program under GSA than it previously paid the contractor.
"Army families are suffering because of GSA's planning and process failures," said GSA Inspector General Carol Ochoa, in a statement announcing the findings. "GSA's efforts to gain control of this program have so far failed, as backlogs continue to mount."
The subsidy programs helps eligible military families reduce the cost of child care in the community when the service is not available on the installation. It compensates for some or all of the gap between the on-post cost of child care, and the cost for care outside the gates. Families must provide documentation certifying their eligibility, and child care providers must prove they are qualified to provide the care. Providers submit invoices to GSA each month for each child enrolled.
By the end of July, the backlog had grown to more than 9,100 unpaid child care provider invoices. Information was not immediately available about whether the Army plans to assist the families who have suffered financial hardships because of the problem.
One soldier wrote to the GSA IG: "It is to the point that my [spouse] and I are now filing for bankruptcy. I cannot stress how much we need assistance with day care. Right now we are paying $1,000 a month out of pocket."
GSA IG spokeswoman Sarah Breen said the IG's office is keeping those families informed who have contacted the office.
GSA agreed to accept the transfer of the more than 9,000 Army families beginning last October. The previous chief financial officer of GSA, who was in charge of overseeing child care subsidy programs at the time of the transfer, told IG investigators that in hindsight, GSA should have told the Army it needed more time to put the right systems in place before taking on the expanded program. He also cited "big errors" in planning.
Under the Army's rules for the program, families must cover the full cost of child care while GSA processes applications for subsidy payments. Some families reported waiting months for GSA payments. They also expressed "extreme frustration" with the agency's failure to respond to their emails and phone calls.
GSA staff members told investigators they didn't have the "luxury" of listening to all the families' voicemail messages, because of the backlog of other tasks. Thus, the voicemail messages periodically were deleted because of the limited size of the voice mailbox.
"We just had to pay $1,500 to bring our account to a zero [balance] because of your failure to provide us with notice to re-certify and because of your failure to respond to our multiple inquiries," wrote one Army spouse in an email to GSA. In a later email, the spouse wrote: "This is unacceptable. Still no callback from anyone. It has been two months since we started this process. I keep trying to call and leave messages and no one picks up and no one returns our calls."
In response to the IG evaluation, GSA's chief financial officer, who oversees the program, said the agency has taken a number of steps to improve the program's management, including increasing staffing (another 60 people in July and August), implementing a new system to manage the information and workflow, and simplifying the application process for Army families.
GSA expects to eliminate the backlog by the end of the calendar year, wrote Gerard Badorrek, the agency's current chief financial officer. "We have been disappointed that these actions did not result sooner in a reduction of the backlog," he wrote.
GSA's efforts to hire additional people were affected by on-boarding issues and finding contractors with the right skills, he added.
GSA is seeing some progress, he noted, pointing out that the number of emails that have not been reviewed dropped from over 4,000 on July 31 to 621 by Sept. 2.
GSA officials are meeting with Army officials to discuss the Army's long-term plans for the child care subsidy program, Badorrek wrote. "We understand that Army is considering a range of options for administering the program, and we will work to support their decision on the program's future. Once they have decided on a firm path forward, we will work with them to detail a transition plan, including the conditions for program transfer.' "
Investigators noted that since 2003, the GSA administered the fee subsidy program for the 200 Army families enrolled in federal child care centers, and the Army was very satisfied with the high level of customer service. But before the GSA took on the extra 9,000 Army families for private child care providers, its sum total workload for all the child care programs it administered in the federal government was only about 1,400 families.
Earlier this year, the GSA IG found that contractors hired to process subsidy program applications were able to get access to sensitive information about Army families, including personally identifiable information, before those contractors had completed required background investigations, fingerprint checks, privacy training and nondisclosure agreements.
The IG issued a management alert, and GSA has taken steps to prevent unauthorized access.