ST. LOUIS — Patricia Jones always dreamed of running a daycare in the city she’s called home her entire life.
"I love it. I love what I do," said Jones, the owner of Mess Pat’s Daycare in North St. Louis city.
But lately she said she's been losing sleep. Most of the children at her child care center live below the poverty line, relying on state subsidies. With the state owing her around $25,000 in payments, she said she's now struggling just to keep the lights on.
“It's caused me to lose revenue. It's caused me to have to take out loans, exhaust my additional bank accounts," she said.
The issues started about 10 months ago with a new roughly $14 million IT system through Missouri's department of education. Vendors Carahsoft, MTX, and St. Louis-based World Wide Technology were responsible for setting it up. It was supposed to streamline payments, but providers like Patricia call it a disaster.
The Missouri Department of Elementary and Secondary Education (DESE) awarded the contract in February 2023 for the Child Care Data System to Carahsoft, with World Wide Technology as the prime vendor and MTX as a sub-vendor.
“The new system obviously did not meet our goals," said Karla Eslinger, DESE's commissioner, on September 11 at a hearing in Jefferson City.
“So we're at the point now where we can't believe what they're saying," said Jones.
The I-Team has spoken with dozens of daycare owners in St. Louis and across the state.
“It’s a debacle. It’s chaos," Mary Crockett-Smith, The Christian Academy's founder, told the I-Team in September.
“There's nothing you can do in this situation," said Samantha Cross, Little Precious Angels Childcare district director, in March.
Many providers in Missouri still tell us they are not getting the payments they need to stay in business. Some have already shut down.
POLITICAL DONATIONS
Our investigation uncovered something else: a money trail. The head of one of the state’s key contractors, World Wide Technology, has ties to Missouri politicians. Public records show the company’s founder donated about $230,000 this year to political action committees supporting Republican candidates and state officials, including Lieutenant Governor Mike Kehoe and Governor Mike Parson, according to data from the Missouri Ethics Commission data, confirmed by University of Missouri-St. Louis’ Anita Manion and others with campaign finance expertise.
While Carahsoft holds the main contract, WWT plays a key role in executing the system's implementation and technical aspects.
We contacted Missouri Governor Mike Parson and Lieutenant Governor Mike Kehoe for their response to donations from the founder of World Wide Technology and the possible influence these contributions may have had on DESE's contract selections. The governor's office said the state’s contracting process follows strict laws to avoid political influence. A spokesperson for Missouri Governor Michael Parson told us in an email that state procurement follows legal guidelines to ensure taxpayer dollars are spent efficiently, with contracts awarded by the Missouri Office of Administration’s Division of Purchasing to prevent political interference. “By design, elected officials are not involved in the process to safeguard against political influences becoming a factor in the evaluation or an award of a contract,” the spokesperson said.
In response, a spokesperson with Missouri Lieutenant Governor Mike Kehoe told us in a statement: “Access to safe and affordable childcare is critical for Missouri families. This delay in payments to childcare providers is unacceptable, and Lt. Governor Kehoe will continue working with the Governor’s Office, the legislature, and DESE to ensure government bureaucracy does not prevent these small businesses from providing essential services to hardworking Missourians.”
World Wide Technology told us it had no involvement in donations and is focused on fixing the new IT system. A World Wide Technology spokesperson told us in an email: "In coordination with DESE, WWT is one of a handful of companies including Carahsoft and MTX, responsible for implementing a fully functional system. WWT remains committed to its partnership with DESE on this modernization effort and will continue to invest all necessary time and resources to move this important project forward and ensure that payments are made to childcare providers in an accurate and timely fashion.” With regard to political donations from its founder, the company spokesperson told us: “The donation you refer to was not from World Wide Technology as a company. It is inaccurate to say World Wide Technology made that donation. The donation in question was personal and from one individual, David L. Steward.”
A DESE spokesperson told us they do not have any information about political donations.
But concerns remain.
RED FLAGS?
"It raises a lot of red flags," said Manion, assistant professor of political science at University of Missouri-St. Louis.
For Manion, who studies campaign finance, the connection is troubling.
“I think it's really hard to continue to make excuses when this goes on for long periods of time and isn't rectified and has such dire, real world consequences for families, small business owners and the folks on the ground," said Manion.
Despite the chaos, the state has said it’s sticking with its vendors and promises fixes by the end of the month. The department said it is continuing to work with Carahsoft, World Wide Technology, and MTX.
But for many, it’s too little too late.
LOSING TRUST
“How has this mess impacted the trust that you have in the state to fix this problem?” asked Senior Investigative Reporter Paula Vasan.
“I have maybe 1%, 2% trust in what's going on," said Jones.
Last month, the FBI raided Carahsoft, a contractor tied to the failing system. Carahsoft said the investigation is related to a past client and not its work in Missouri. But critics like Jones said it raises concerns about vendor selection.
A Carahsoft spokesperson told us in an email: “Representatives from the Department of Justice came to the Carahsoft office... as they are conducting an investigation into a company with which Carahsoft has done business in the past. Carahsoft is fully cooperating on this matter. We are operating business as usual.”
DESE does not have any information about a raid at Carahsoft. Meanwhile, the FBI told us: “We can confirm that the FBI conducted court-authorized law enforcement activity on Sunset Hills Road…. We decline to comment further.”
"Do you think the state needs to switch vendors to fix this?" Vasan asked child care providers.
“I think they need to…make sure that whatever vendors they choose, that they can deliver," said Jones.
As the state scrambles for solutions, child care providers across Missouri like Jones are left wondering how long they can hold on.
DESE ADVICE FOR IMPACTED PROVIDERS AND FAMILIES
A DESE spokesperson told us in an email: “Stakeholders can now monitor the child care subsidy backlog status report here on DESE’s website. This is updated weekly. DESE expected the backlog in family applications and provider contract applications to be cleared by the end of September. As the status report shows, we’re on track to meet that target for family applications. The team continues to work on provider contract applications, but some contracts may need additional time to collect information or complete onsite visit with providers. Payment reviews for corrections are expected to be completed by the end of October.”
A DESE spokesperson told us: “The new Child Care Data System (CCDS) allows families and providers to have a web-based, near real-time system to enter and view their information for child care subsidy. DESE’s Office of Childhood launched the CCDS in December 2023.
There have been a number of challenges during the transition to a new data system. DESE recognizes the importance of subsidy payments to the child care industry and the value the program provides to Missouri’s workforce, in particular for families who provide care to children in foster care. DESE and its contractors, World Wide Technology and MTX, are working hard to address these issues and sincerely apologizes to the child care providers and families affected by this transition.
The ongoing challenges with system issues have created a backlog in family applications for subsidy assistance and provider contract applications. DESE and its vendors are committed to fixing these issues and processing all applications as quickly as possible. Here are the solutions we have put in place:
Family Applications: DESE has contracted with a staffing agency to provide full-time staff to help clear the backlog of family applications. We expect the backlog in family applications to be cleared by mid to late September. Once approved for subsidy, we will ensure there is no gap in the family’s eligibility and authorizations.
Provider Contracts: DESE has cross-trained additional staff to help the subsidy team to clear the backlog of provider contract applications. We expect the backlog in provider applications to be cleared by early to mid-September. Once applications are processed, we will ensure there is no lapse in the provider’s contract.
Provider Payments: Payments are being processed daily and providers are getting paid, though some are not receiving full payment due to ongoing technical issues. DESE has put the following resources in place to address the outstanding payment issues as soon as possible.
DESE’s current contractors who support the child care data system have doubled the number of staff working on issues preventing or delaying provider payments.
DESE contracted with an agency to clear the backlog of subsidy payment corrections.
DESE hired a team of part-time employees to assist with processing requests for missing payments.
Parents and providers with questions may call 573-415-8605 to speak to a customer service representative during these hours:
Monday through Thursday: 8:00 a.m. to 8:00 p.m.
Friday: 8:00 a.m. to 5:00 p.m.
Saturday: 8:00 a.m. to Noon
Parents and providers experiencing a longer wait time during the day are encouraged to call back during evening or weekend hours.”