Contractor regains Army child-care program

By Lisa Rein | The Washington Post | Published: January 7, 2016

WASHINGTON — The government will turn over the management of a program that helps Army families pay for private child care back to a private contractor after a federal agency bungled the job for a year, officials said Wednesday.

Child Care Aware of America, which ran the Army Fee Assistance program from 2004 to 2014 before the Army canceled the contract to save money and gave responsibility for it to the General Services Administration, will start accepting applications on Feb. 22, said witnesses who testified at a congressional hearing.

The program helps eligible service members pay for child care in the private sector when there is no care available on base. Nearly 13,000 families participate in the Army's program, growing from 200 families during the past 12 years.

Child Care Aware of America runs similar subsidy programs for the Air Force, Marine Corps and Navy. But the Army was promised it could save about $4 million by transferring management of the program to GSA, so it made the change in early 2014.

The problems started soon afterward and were disclosed by GSA's inspector general in September 2015: thousands of unprocessed applications, unanswered phone calls from families, deleted voice mails from worried families and unpaid invoices.

GSA took up to seven months to process some subsidy applications, an audit report found. Army families reported that during the long waits, they considered having a spouse quit a job or school so that one parent could stay home with their children. The backlog, first revealed by the inspector general's office early last year, gained public attention after reporting by NBC4.

The program worked this way: Child-care providers send monthly invoices to GSA for each child, and the agency pays its part of the cost once it verifies the information it receives from families and providers. Families have to pay all child-care costs up front while they wait for approval.

Inadequate staffing and technology to accept and process applications for subsidies was quickly overwhelmed by the demand from families, officials said. GSA had to sink another $4.4 million into handling the backlog, wiping out any savings it had promised to the Army.

GSA officials said at Wednesday's hearing before a panel of the House Oversight and Government Reform Committee that they have whittled down the backlog from 26,000 requests for service to about 1,500.

GSA Inspector General Carol F. Ochoa also noted a significant drop in complaints about the program since the agency started paying the backlogged invoices.

GSA's chief financial officer, Gerard Badorrek, said it is "now responding to most phone calls and emails within 24 hours, reviewing family requests for enrollment changes within days and completing these family requests, in most cases, within a few weeks."

But the federal mismanagement was so serious that the Army decided to turn administration of the program back to the contractor.

The Army apologized for poorly managing the initial transition and failing to ensure that GSA could handle the increased workload and administration of the program. "We deeply regret the hardships and inconvenience we caused our families and are doing everything possible to regain their confidence and ensure mission readiness for our families," Stephanie Hoehne, director of family and morale, welfare and recreation at the Army Installation Management Command, told lawmakers.

Congressional leaders seemed relieved by the progress.

"While the work done so far deserves recognition . . . it does not mean this program is out of the woods yet," said Rep. Mark Meadows, R-North Carolina, chairman of the subcommittee on government operations.

Children play outside the Child Development Center at Fort Myer, Virginia, July 8, 2008. Due to the effects of sequestration, the military said in 2013 that the hours of child care centers on bases could be cut or reduced.
Adam Skoczylas/U.S. Army


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