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Report Cites Need for DC to Continue Investing Strategically in Early Care and Education

Report Cites Need for DC to Continue Investing Strategically in Early Care and Education

Today, DC Appleseed and DC Fiscal Policy Institute issued a new report — Solid Footing: Reinforcing the Early Care and Education Economy for Infants and Toddlers in DC.

The study examines how much it costs early care and education (ECE) providers to meet the level of quality that the District requires, and how providers are able to maintain a high level of quality in their programs while serving families who depend on child care subsidy payments from the government.

In particular, the new report uncovered several important findings about the costs of delivering care and the experiences of ECE providers, including:

  1. Current child care subsidy rates cover only 66 to 70 percent of the median cost per infant or toddler for care in an accredited environment. The programs receive valuable government support in several ways in addition to tuition subsidies, but the support is not evenly distributed and does not fully cover the cost of meeting quality requirements and other operational challenges.
  2. Some providers are located in areas of the District where few families have incomes that allow them to pay private tuition rates. As a result, these centers do not have a sustainable mix of revenues and often do not have adequate resources to provide the highest-quality care and make ends meet at the end of the year.
  3. Many providers, even among a sample of the highest quality programs in the District, lack the business systems necessary to thrive in the fragile child care economy.
  4. There is very little consistency across ECE centers in terms of how resources are allocated and used. The only consistent pattern across business models is low wages for staff and the desire to pay them more.
  5. Most centers serve children with developmental delays and disabilities, but, aside from children and staff receiving some government-sponsored support in the classroom, they are not compensated for the additional time and costs associated with providing such care.

“Early experiences matter, and the people who provide those early experiences for our most vulnerable infants and toddlers matter. Right now the child care system is subsidized by the low wages that most of these providers are paid.  If we invest in these providers and these children, we not only save money in the long run, but we help to close the achievement gap and interrupt the cycle of poverty,” said Judy Berman, Deputy Director of DC Appleseed and co-author of the report.

“Research shows us the importance of providing high-quality care for young children before they enter school, and this is even more critical for our lowest-income children,” said Soumya Bhat, Education Finance and Policy Analyst at DC Fiscal Policy Institute. “It’s important to ensure those providers who serve mostly low-income children have adequate resources to provide this level of quality.”

These findings have informed seven key recommendations for strategic investment in two core areas: ECE centers and homes and the ECE Workforce. In order to adequately serve families equitably and sustainably, the District must invest strategically to support a thriving child care economy of sustainable businesses and qualified workers.

RecommendationsInvest Strategically in ECE Centers and Homes to Build More Sustainable Business and Service Delivery Models

1.    Increase Child Care Subsidy Rates and Other Government Services: Phase-in increased payments and in-kind supports to providers across the board to cover the 30-34 percent gap in revenue for high-quality providers.

2.    Further Differentiate Child Care Subsidy Rates: Implement differentiated subsidy rates that take account of differences beyond a child’s age and program quality. For example, providers should receive a base rate plus “at-risk” funding for programs located in census tracts with highest poverty rates, or payment rates that will incentivize providing services during non-traditional hours.

3.    Facilitate Improved Record-Keeping: Support the ability of licensed centers and homes to digitize and analyze their attendance, costs, revenues, food consumption, and other business matters.

4.    Pilot Shared Service Models: Seek funding to pilot public-private partnerships for “shared service” arrangements which offer providers access to third-party professionals to execute certain administrative and business tasks for their child development center or home. This allows small businesses to achieve economies of scale and save time on operations, such as payroll and purchasing.

Invest Strategically in the ECE Workforce

5.    Adopt and Incentivize Specialized Professional Development: Adopt or design specific professional development tracks, such as serving children with special needs, and incentivize providers to pursue these opportunities with bonuses to staff who participate.

6.    Supplement Salaries: Create a salary supplement program for teachers and directors based on education levels and longevity.

7.    Improve Coordination of the Early Care and Education System with Data: There is a need for strategic coordination among the city’s public and private entities to deliver a more streamlined approach to funding and managing early childhood services, including child care/early learning opportunities, maternal and child health home visiting, social-emotional health interventions, early intervention, and others. A better understanding of the system can start with a resource map of all of DC’s ECE supports to better identify the city’s gaps and overlaps in services for young children and their families.

DC Appleseed and the DC Fiscal Policy Institute both call on the District’s public and private partners to work on implementing the recommendations found in this report.