Chairman Mendelson and members of the Committee, thank you for the opportunity to testify today. My name is Danielle Hamer, and I am a policy associate at DC Fiscal Policy Institute (DCFPI). DCFPI is a nonprofit organization that promotes budget choices to address DC’s racial and economic inequities through independent research and policy recommendations. DCFPI is a member of Under 3 DC, a coalition committed to securing a strong start for every infant and toddler in DC.
My testimony focuses on ensuring that District officials quickly act on the Early Childhood Educator Compensation Task Force’s recommendations and continue to advance policies aimed at equitable outcomes for early educators and the child care sector. In the short term, this includes efficiently disbursing salary enhancements this fiscal year while securing counseling for early educators who may lose benefits as a result. To achieve parity in the original Birth to Three law and equity in the permanent compensation program, lawmakers should 1) incorporate health benefits as a crucial part of compensation, and; 2) monitor the subsidy program to ensure that compensation across the industry supports, rather than harms, DC’s lowest-income families, including those accessing subsidized care.
OSSE Should Swiftly Deliver Early Educators’ Compensation Funds
DCFPI commends the DC Council for its unanimous approval of the Early Childhood Educator Equitable Compensation Task Force Temporary Amendment Act, which helps clear the way to get the $53.9 million in the Compensation Fund into the hands of early educators. Now it is up to the Office of the State Superintendent (OSSE) to ensure educators receive their supplemental pay by the end of this fiscal year while the Task Force forms a permanent, long-term compensation proposal for the following years.
Early educators help lay the groundwork for DC’s youngest residents’ development and academic success, and the District’s historic investment in the early childhood workforce represents a strong first step in strengthening our child care system. Based on the Task Force recommendation, the temporary legislation will ensure most early educators in DC can apply for a pay supplement of $10,000 to $14,000 before September 30, 2022. It is crucial that OSSE disburses the enhancement payments swiftly and efficiently to implement hard-won benefits for workers who are primarily women of color. A long history of undervaluing “domestic work” has left many of DC’s early educators living near the poverty line. From forced labor during enslavement, to Black codes that limited Black women to domestic service, to occupational segregation that exists today, Black and brown women providing early care continue to be paid low wages and denied benefits.
For years, the wages of early educators in the child care sector have barely been above the minimum wage, despite the high cost of living in the region. Swift delivery of supplemental pay this year is a strong first step in addressing the long-standing devaluation of care work and the economic struggles of the mostly Black and brown women that make up our early learning workforce.
Roll Out of Higher Compensation to Early Educators Must Guard Against Benefits Cliffs
As the Task Force and OSSE consider the stipend program, they should choose the frequency of payment—such as a one-time lump sum or monthly and quarterly payments—that leads to the fewest disruptions in health care coverage for these workers. Early educators should not lose Medicaid coverage or marketplace subsidies when there is not yet a plan in place to ensure holistic compensation parity.
The Task Force should also consider ways to notify educators about the ways in which their work and income supports might be reduced by higher wages. The DC Council should review these scenarios and set aside funding to help early learning professionals navigate potential public benefit and health care disruptions they may experience. This funding could support small grants to direct service providers who can advise early educators about potential benefit cutoffs or reductions, or at minimum, support the production of materials on potential benefit cliffs and the local counseling resources available. OSSE could require employers to share this information with their employees.
Council Must Include Health Care as a Crucial Component of Fair Compensation for Early Educators
The FY 2022 supplement is the first step in creating a new, permanent early educator compensation scale. As the Task Force develops its final recommendations for a permanent program, DCFPI urges the Council to advance a proposal that adequately addresses health care, whether it be in FY 2023 or later in the financial plan. As outlined in the Birth-to-Three for All DC law, parity for early educators means compensation equivalent to the average base salary and fringe benefits of an elementary school teacher employed by District of Columbia Public Schools (DCPS) with the equivalent role, credentials, and experience. Benefits include health care, paid time off, and retirement. To fulfill the promise made in the legislation, final recommendations for a parity program should, at minimum, include a comparable salary scale to DCPS teachers and health care benefits, and then work towards incorporating the remaining fringe benefits into the program. Higher pay and affordable health care work hand in hand to fairly compensate early educators.
Excluding health care benefits as part of the compensation program would not only violate the spirit of the Birth-to-Three law, but it could cause some workers to be worse off in the end if their total wage increase fails to outstrip any increased cost in health care coverage that they face due to higher wages. Higher costs could be a result of losing Medicaid eligibility or facing a higher premium through employer-sponsored insurance or through the marketplace. The proposed base salary levels for all assistant teachers ($39,500) and lead teachers ($48,200) are higher than the Medicaid income threshold for single workers without children ($27,000) and single workers with one child ($37,700); other workers could lose eligibility depending on their family size and credentials.
Whereas DCPS provides health care coverage directly and uniformly to teachers, some early education providers cannot afford to provide health care coverage to their employees. There is a mix of experiences across the sector, with some workers having employer-provided insurance, Medicaid, or subsidized insurance through the marketplace. The task force should assess mechanisms available for ensuring all early educators have affordable health care coverage, including a direct grant to employers to help offset the cost of insurance or potentially a direct subsidy to the employee through the marketplace.
The District could follow the lead of California and Vermont, states that have established programs providing subsidies to certain populations or industries for their state marketplace insurance systems. Washington State recently implemented legislation that provides marketplace subsidies specifically for early educators. Emerging evidence from the Washington state subsidy program demonstrates that the take-up rate is low considering the pool of educators covered under Medicaid and receiving employer benefits. This demonstrates that those who most need affordable health care have access to it, but program costs can stay low because early educators who can stay in Medicaid or prefer their current insurance options will not rely on subsidies. By establishing a program similar to this, District leaders could target the limited, but crucial funds necessary to secure health care for early educators who will lose Medicaid benefits.
District Leaders Can Work Towards Child Care Equity by Monitoring Provider Participation in the District’s Subsidy Program Following Compensation Implementation
The Task Force compensation proposals should benefit and secure fair wages for the entirety of the early childhood workforce. However, District leaders must prioritize putting forth a program that does not create further disparities in the child care sector between families who can afford child care and the majority Black and brown families who rely on child care subsidies to afford care. The Task Force is currently considering incorporating an equity adjustment into the compensation formula that would create an enhancement for child development facilities based on the percentage of enrolled children whose families use a subsidy and a social vulnerability index. The index would incorporate factors of community need, including socioeconomic status, household composition and disability, minority status and language, and housing type and transportation. An equity adjustment is a crucial component of an equitable long-term program to ensure that child care providers who serve DC’s lowest-income families have enough resources to compensate their teachers and provide families with quality care. Providers’ ability to offer and sustain competitive compensation is an essential part of recruiting and retaining the highest quality teachers for DC’s infants and toddlers from families with low incomes and with more barriers to academic success.
DCFPI encourages the Council to ensure this adjustment, along with the Task Force recommendations as a whole, promote high quality care and learning environments for infants and toddlers from DC’s families with the lowest incomes. Lawmakers should ensure the proposal does not disincentivize providers to care for children enrolled in the subsidy program. If the program fails to establish a clear prioritization for providers who take on subsidy students, there are risks that the number of providers in the subsidy system may decline or stagnate. If providers receive sufficient public funding from the compensation program alone, they may elect to avoid the red tape and requirements of the subsidy program. As fewer providers take on subsidy students, the providers who are currently taking majority subsidy students could be overburdened, meaning less capacity and less quality for infants from low-income families.
All early educators should be compensated fairly, and low-income families should have access to high-quality care across the District. Council should ensure the long-term compensation structure is equitable in both its design and its implementation. Upon program implementation, the Council should create an oversight plan to monitor participation rates for the District’s subsidy program as one mechanism crucial to keeping early care affordable for families with low incomes.
 Julia Isaacs et. al, “Early Childhood Educator Compensation in the Washington Region,” the Urban Institute, See Table 6; wages in 2016 dollars. April 2018.
 The Center for Law and Social Policy, “An Anti-Racist Approach to Supporting Child Care Through COVID-19 and Beyond.” July 14 2020
 Doni Crawford and Kamolika Das, “Black Workers Matter.” January 28, 2020.
 Economic Opportunity Institute, personal communication. February 17, 2022.