1 Report for Early Learning Council Presentation to WERA December 5, 2008 Access to High Quality Early Learning for Washington’s Young Children “Forging a Brighter Future for Children and Families” AT THE EVANS SCHOOL OF PUBLIC AFFAIRS | UNIVERSITY OF WASHINGTON Richard N. Brandon, Ph.D. Human Services Policy Center University of Washington

2 Outline Purpose of Study Guiding Principles Policy Specifications from ELC Financial Analysis of Policies Specified Full study:

3 Purpose of Study  Assist the ELC to consider alternative policies that provide all young children in Washington access to high quality early learning  Simulation process; guidance from research  Analyze costs, impact on family affordability, and targeting of funds, for alternative policy packages  Design and implementation issues will remain

4 Guiding Principles 1.High quality early learning (B-5) -- essential to children’s healthy development and school success 2.A market-based approach– financial access and choice for families with incentives and requirements for quality 3.All settings, including parents, FFN’s 4.Specialized professional training and education 5.Adequate compensation 6.Cost-effective solutions

5 Percent Total Non-Parental Hours, US NHES Children B-2 Children 3-5

6 ELC Specifies Criteria for:  Each QRIS Level &  Family Affordability Quality-based rates determined for providers; reflect actual cost of each QRIS level (various payment mechanisms possible) Eligibility determined by affordability criteria & work/training requirements Total Assistance Cost  Sum of Quality- based payments for eligible children  Varies by quality, salary & eligibility specifications  Distributed by age, income, setting The Relationship Among QRIS, Reimbursements Based on Quality, & Financial Access Payments made for children/families based on income, cost-quality of setting (scholarships)

7 Comprehensive Approach: A Funding Package to Implement Many ELC Recommendations Parenting information & support QRIS: costs to implement & help providers improve early learning services Financing that links funding levels to program quality (tiered reimbursement) Professional development & compensation Affordability: populations to be served Continuity of care for children

8 Scope of Specifications Quality Financial Access Scope of Services Governance and Implementation Phase-In Approach

9 Quality Specifications Moderate salary schedule – BA at annualized elementary teacher; AA, HS lower; MA higher Professional Development: paid release time; allotments for higher ed tuition or community-based training, plus expenses. Ratios at each QRIS level, for each age group: Infants 1:4, toddlers 1:5/7; preschoolers 1:9/10) Staff Mix: Percent college degrees increases with QRIS level

10 Financial Access Specifications Eligibility: –Work/school/training requirement for all families; –Expanded eligibility for families in work/school transition Affordability: –H.Q. costs ~25% average net income if no assistance –Family portion of child care costs increases as income increases –Families pay no more or less than current payments –Income cut-off for assistance: Just over 3x Federal Poverty Line (~$62,000 for family of four)

11 Scope of Services FFN Support –Infrastructure, resources and information, play & learn, facilitated workshops, evaluation Parent Support –Needs assessment and evaluation, infrastructure, home-visiting, parent education ECEAP Child Care Partnerships –Provide access regardless of work requirement –Expand to B-3

Hourly Costs to Providers of Meeting Quality Standards - Centers 12 Infant costs lower due to low ratios; not assume cross-subsidies

13  Moderate salary option yields costs close to 50 th percentile prices (+5%)  33% higher than current state reimbursement rate

14  Quality promotion, regulation and professional development = 8%  Hourly cost components vary slightly by age group and between moderate and higher cost options.

15  HQ equal 50 th percentile if moderate compensation; 75 th if higher

FCC vs. Center Hourly Costs Weighted Average of Ages 16  FCC 75-80% of Center costs; currently 87%

Affordability to Families Market effects, tenable price required Criterion – 10-15% Net income ~ current price Findings => partial assistance required for middle income families 17

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% QRIS Level 1QRIS Level 3QRIS Level 5 QRIS Level 1 75%27%17%14%11% QRIS Level 3 80%29%18%15%12% QRIS Level 5 86%31%19%17%13% < 1 FPL1- 2 FPL2- 3 FPL3- 4 FPL4 - 5 FPL Affordability: Cost of ECE as Percent Net Family Income

Eligibility Increases Targeted to Moderate-Middle Income

20 Phase-In Approach Phase-In approach for QRIS, Family Support and FFN –15% of state in –25% of state in Raise floor of current subsidies to 50 th percentile market rate for remainder of state Invest in statewide infrastructure

21 Increased State Costs for Access Study Option

Conclusions:  ELC Preferred Option would provide access to high quality ECE for all children at modest cost, relative to public education spending in Washington  QRIS/TR would provide accountability, incentives  Providers would need stable funding source to make significant chances in staff qualifications, compensation  Middle income families would require partial assistance to afford high quality ECE - otherwise market would collapse

23 Extra Slides

24 Full Study Available online: _report_FINAL.pdf

25 Example of Income-Related Scholarship QRIS Level 3 - Moderate Compensation; for higher compensation, scholarship would increase, family payment would not increase. Toddler at a Center Hourly cost = $4.04; Monthly Cost (40 hrs/wk) = $695 Family Income Family Payment (Monthly, Per Child) Scholarship Low < 1 FPL ($0-20K) (1% Net Inc.) $8$687 Moderate = 1-2 FPL ($20-40K) (3% Net Inc.) $63$632 Middle = 2-3 FPL ($40-60K) (8% Net Inc.) $272$423 Upper-Middle = FPL ($60-62K) (14% Net Inc.) $535$160

26 Example of Affordability for Family Child Care Home QRIS Level 3 - Moderate Compensation; for higher compensation, scholarship would increase, family payment would not increase. Hourly cost = $3.47; Monthly Cost (40 hrs/wk) = $597 Family Income Family Payment (Monthly, Per Child) Scholarship Low < 1 FPL ($0-20K) (1% Net Inc.) $8$589 Moderate = 1-2 FPL ($20-40K) (3% Net Inc.) $63$534 Middle = 2-3 FPL ($40-60K) (8% Net Inc.) $272$325 Upper-Middle = FPL ($60-62K) (14% Net Inc.) $535$62

27 Governance & Implementation State infrastructure (statewide) –State advisory group, CCR&R, MIS QRIS implementation costs (phase-in) –QRIS grants, accreditation fees, external assessment, training infrastructure Evaluation and Baseline Assessment of Child Care Quality and School Readiness (phase-in) Costs of administering benefits