On-Site Child Care Centers Slow to Gain Favor Among Employers

Here’s a switch: A large West Los Angeles employer wants to start a child-care center for its employees to use, but after five years of work on various plans, it has yet to reach the finger-paint-and-nap-mat-stocking stage.

Even stranger: It is a government operation that is trying a creative public-private approach to the child-care dilemma. And it can’t get it off the ground.

The West Los Angeles Veterans Affairs Medical Center has been struggling with different options over the years, the latest being a partnership with a private provider. The VA would supply the land for a nominal rent and the private company would build and operate the center. But after a lengthy federal procurement process that involved congressional notification, a public hearing, bidding, scoring of bids and final selection of a child-care provider, the project has stalled because the company that won the competition turned down the VA’s offer.

“We worked very hard on this. It would have been wonderful,” said Bonnie Olson, a psychiatrist who heads the VA center’s child-care committee.

“We’ve been wanting to do this forever. The joke is, my kid is going to be in college before this happens,” said Olson, whose 4-year-old son attends preschool.

A child-care center at or near the workplace is a wonderfully photogenic representation of a company’s commitment to family-friendly policies. It gets a lot of publicity and it looks great to visiting VIPs. But despite the popular notion that such centers are popular, not that many businesses opt for them.

To be sure, there are thousands of lovely child-care centers operated by corporations on or near their work sites. They go a long way toward making employees happy, reducing absenteeism and improving productivity.

But as corporate policies catering to working parents have mushroomed during the last several years, the proportion of employers offering child-care centers has not.

A 1990 survey by the Hewitt Associates benefits consulting firm found that 64% of employers offered some kind of child-care benefit for employees, but only 9% of companies with child-care benefits operated or participated in an on-site or near-site center.

Five years later, a survey found that child-care benefits were offered by 85% of those polled. But the percentage participating in child-care centers was virtually the same (10%).

“Most companies are trying to appeal to a wide cross-section of their employee population,” said Christine Seltz, a spokeswoman for Hewitt Associates of Lincolnshire, Ill. “If you’ve got a 10-year-old, a child-care center is not going to do you a whit of good.”

Some employers doubt their workers would be willing to lug small children daily into busy downtown areas, for example, and so are more likely to try other benefits such as dependent-care accounts and referral services, Seltz said.

After the Northridge earthquake in January 1994, the VA bureaucracy picked up the pace on the project for West Los Angeles and for another center at the Sepulveda VA. The centers would probably be used not only by VA employees, but by workers for other nearly employers. But in March, the preferred provider, Kindercare Learning Centers of Montgomery, Ala., notified the VA that it had decided not to participate.

Jay Tasset, director of the Kindercare at Work division, which provides workplace child care, said Kindercare determined that the demographics in the areas surrounding the two proposed centers did not meet the internal standards of the fast-growing company. Kindercare wanted the VA to guarantee that a certain number of the slots would be filled, and the VA would not provide that guarantee, he said.

“If the fit were right, we would love to do business with the VA,” Tasset said. “It’s not them, it’s the area.”

A VA spokesman said the project is not dead. Negotiations will begin soon with other child-care providers who submitted bids.

Olson said she is “very sympathetic to the fact that most people can’t afford child care. . . . You really have to lie, cheat, steal and know somebody to get your kid into preschool. This is very close to my heart. We will find a way to do this.”