1. 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. 2 Outline Purpose of Study Guiding Principles Policy Specifications from ELC Financial Analysis of Policies Specified Full study: www.HSPC.org

3. 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. 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. 5 Percent Total Non-Parental Hours, US NHES - 1999 Children B-2 Children 3-5

6. 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. 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. 8 Scope of Specifications Quality Financial Access Scope of Services Governance and Implementation Phase-In Approach

9. 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. 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. 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

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

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

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

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

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

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

18. 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

19. Eligibility Increases Targeted to Moderate-Middle Income

20. 20 Phase-In Approach Phase-In approach for QRIS, Family Support and FFN –15% of state in 2007-2008 –25% of state in 2008-2009 Raise floor of current subsidies to 50 th percentile market rate for remainder of state Invest in statewide infrastructure

21. 21 Increased State Costs for Access Study Option

22. 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. 23 Extra Slides

24. 24 Full Study Available online: www.hspc.org http://hspc.org/publications/pdf/ELC _report_FINAL.pdf

25. 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 = 3-3.2 FPL ($60-62K) (14% Net Inc.) $535$160

26. 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 = 3-3.2 FPL ($60-62K) (14% Net Inc.) $535$62

27. 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