Iowa Food Program Policy Overturned

Valerie Owens, a family child care provider in Iowa, wanted to expand her business in 2004 by hiring an employee to help her care for more children. But the state Department of Education that administers the Food Program interpreted a new state law in a such way that caused Valerie to lose her Tier I status and a lot of money each month.

It took over six months of persistence by Valerie, with the advocacy help of Tom Copeland, before the national office of the Food Program overruled the state's policy and restored her Tier I status.

In 2004 the state of Iowa changed their rules to allow providers to care for more children as long as two caregivers were present. The rule required both caregivers to be listed on the registration which Valerie did when she hired an employee. Her Food Program sponsor then said that now both her and her employee would have to qualify as low income to qualify for the higher Tier I reimbursement rate. Because of the higher income status of her employee this meant that Valerie no longer qualified for Tier I and would receive the lower Tier II rate.

Valerie talked to both the local and state representatives of the Food Program and argued that when determining her income eligibility the program should look at her net income (gross income minus business expenses) only. She had hired an employee, not established a partnership. "I became frustrated and felt that no one was listening to me and my situation," said Valerie.

Valerie then called me for help and I contacted the Iowa's Department of Education. The representative said that the state assumed that when two names were on the registration they were operating as a partnership and thus both persons would have to qualify for the Tier I status. I said that the state could easily ask the primary provider to produce a tax return which would show whether she operated as a partnership or a self-employed business but the representative said the state was unwilling to do this.

I then contacted the regional office of the Food Program and asked for a ruling on Iowa's policy. The regional officer forwarded our request to the national office that ruled that Iowa's policy was in violation of Food Program regulations. On August 30th the state of Iowa issued a new policy that allows providers in Valerie's situation to provide proof that she is operating as a self-employed business by submitted tax records or employee paychecks.

In a thank you letter to us, Valerie wrote, "As a day care provider I have seen the regulations of our business become more complicated over the last 16 years, and I have also seen the state department personnel stretched for time and resources. In particular in-home providers come and go not because people do not want to care for children, but because they lack the support and the resources to understand all the regulations they are required to meet, and providers also become overwhelmed with the paperwork and they walk away from a wonderful business opportunity. Redleaf National Institute and Tom Copeland provide that professional support and the resources needed to help day care providers all across the country. He gave me what I needed the most--confidence in the fact that I was right and that this was an issue that needed to be pursued, not only for myself, but for everyone in the state of Iowa who was doing in-home day care. For this support I am truly grateful."

If your state Food Program office is requiring both providers listed on the license or registration to qualify for Tier I, this is contrary to federal regulations. If you have any questions about this issue, please contact me at  tomcopeland@live.com

Letter from Valerie J. Owens

August 2005

Dear Mr. Copeland,

I wanted to take this opportunity to thank you for your help and support to me as an in-home provider. I have been an in-home day care provider since 1989. In 1992, I discovered you, your organization and your book on helping providers with their business income taxes. I have been through 2 audits since then, and each time I came out okay because I followed your book.

During those years there have been a lot of changes for day care providers to adjust too. Last year in the state of Iowa, there was a major revision to the way in-home day cares were registered. With these changes, business decisions became more complicated. A new category of registration was added where an in-home day care could register as two providers, with one provider being the home owner, and the other provider meeting the minimum requirements for being their own provider, but working along side the first provider, and able to take over in the first providers absence. I decided that this was a perfect opportunity to expand my business, and give me some flexibility by being able to leave the second provider in charge of the day care during the day when there were fewer children to care for. I live in the country and I have mostly school age children and often only need the second provider when they are present.

The problems began when our local Food Program contact called me and said, "Now you will have to have both providers on the registration qualify for Tier I." This made no sense to me as the second provider was an employee and not a partner in my business. At the state level the Food Program contacts were looking at my registration which now had both providers names listed and assuming that we were in partnership and not going any further to investigate the situation.

After trying to talk to local and state Department of Human Service and Food Program contacts I became frustrated and felt that no one was listening to me and my situation. Then I remembered Tom Copeland. I had previously had some wonderful experiences with speaking to Tom on the phone and getting the answers I needed. The support had always been of the highest professional quality and that is what I needed. I also love the fact that you can call and get right through, or email and receive a quick response. So I called Tom with my situation and he gave me what I needed the most--confidence in the fact that I was right and that this was an issue that needed to be pursued, not only for myself but everyone in the state of Iowa who was doing in-home day care. Tom summarized all the reasons why I should pursue this issue, and how to go about it. He made phone calls to the state of Iowa's Food Program contacts, and to the Regional contacts as well. He suggested I call my state Representative and I did. He never tired of me calling and asking additional questions, and he was always clear on what the next step should be for me.

The whole process took about 6 months, but we won, and the Policy change was made after the state of Iowa reviewed the response from the Federal level. I have attached a copy of the Policy change memo.

As a day care provider I have seen the regulations of our business become more complicated over the last 16 years, and I have also seen the state department personnel stretched for time and resources. In particular in-home providers come and go not because people do not want to care for children, but because they lack the support and the resources to understand all the regulations they are required meet, and providers also become overwhelmed with the paperwork and the system, and they walk away from a wonderful business opportunity. Redleaf Press and Tom Copeland provide that professional support and the resources needed to help day care providers all across the country. For his support I am truly grateful and without it I would not be able to proudly say that I have provided care for over 200 day care children, 100 crisis care children, 18 foster care children, and adopted 10 special needs children to bring my family to an even dozen. I am proud to have worked with Tom, and today, I have learned that one person can change the world for the better. Thank you, Tom.

Sincerely,

Valerie J. Owens Winterset, Iowa

Tom Copeland - www.tomcopelandblog.com

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