Sarah Esty

From Hartford to Washington, D.C., early childhood education and services have been a major topic of conversation over the last few months. In February, President Obama proposed to invest $75 billion in expanding preschool, Early Head Start, and other services to young children. Nobel prize winner and early childhood expert James Heckman argued that our society’s significant investment in remediation and interventions in later years is massively inefficient, and we are dramatically underinvesting in the earliest years. The New York Times reported last month on multiple recent studies highlighting the need for greater services targeted at children before they enter kindergarten.

Our fourth annual Connecticut Early Care and Education Progress Report: 2012, released last week, finds that Connecticut is making some progress on providing access to early care experiences for Connecticut’s most vulnerable infants, toddlers, and preschoolers and improving the quality of those programs. However, funding for early childhood services fell between Fiscal Years 2011 and 2012, and remains below levels from a decade ago. And too many children in the state’s low-income families lack access to state-subsidized care. Most significantly, the report finds:

1. Spending on early care and education fell by 1.1% ($2.6 million) from Fiscal Year (FY) 2011 to FY 2012 (ending June 2012). Funding has been stagnant or declining since 2008.

2. Connecticut served 4.4% more infants and toddlers and 5.5% more preschoolers with state subsidies in FY 2012, compared to FY 2011. However, even with these increases, 80% of infants and toddlers in low income families (below 75% of the State Median Income) and 30% of preschoolers in low income families did not receive state-subsidized care.  The counterintuitive finding that the number of children served increased while state spending fell is a result of provider reimbursement rates that have not kept pace with inflation (rates in Care4Kids, the largest subsidy program for low-income working families, have not been raised since 2001). Thus, while it appears that the state is serving more children with less money, in reality, this merely reflects that the per-child subsidy amount has fallen, leaving parents and providers to shoulder an ever-larger share of the cost.

3. Connecticut has seen improvements in quality, with a growing percentage of state-subsidized children being served in accredited settings – 35.2% of infants/toddlers and 56.1% of preschoolers in 2012. The average level of education of the early childhood workforce has also risen, with 57% of administrators and 37% of teachers holding a BA or more and at least 12 ECE-related credits. This is particularly important because most of the benefits of ECE accrue only when children have access to high quality care.

Looking forward to the results of the current fiscal year and beyond, we have several reasons for optimism. First, the budget for FY 13 funded 1,000 new preschool slots, facilities capital improvements to support those slots, and $6 million for the creation of a Quality Rating and Improvement System (QRIS) that will help parents identify high quality programs and providers improve their performance. If these funds are fully spent during the current fiscal year (FY 13), even after rescissions and deficit mitigation, this will represent an 8% increase over FY 12 and the greatest amount spent on early care and education since 2002.

Second, and perhaps even more exciting, is the proposed new Office of Early Childhood. For each of the last four years, one of the most significant recommendations in our annual reports has been the need for a coordinated early childhood system to overcome the present patchwork of programs and funding streams which are confusing for parents and providers. House Bill 6359 is the result of a yearlong planning process kicked off by legislation passed in 2011. It would create a new Office of Early Childhood that addresses this concern by bringing together under one roof the hundreds of millions of dollars in funding and staff from five agencies.

This office is not an end in and of itself – even if all the programs and staff are brought together, much work will remain to be done to  achieve the streamlining, coordination, and improved data collection necessary to realize the benefits of an ECE system. In the long term, the state will need to increase funding in order to raise wages to a level where we can attract and retain quality providers and extend access to all children through the creation of new slots. However, despite the long road still to travel before we see universal high quality early childhood education for all Connecticut’s young children, the Office of Early Childhood will be a critical first step and significant achievement.

Issue Area:

Early Care

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Wade Gibson, J.D.

In February, Governor Malloy proposed a budget that relies heavily on one-time revenues and borrowing to achieve balance. Last Friday, the legislative Finance Committee passed up an opportunity to improve upon the Governor’s budget.  Instead, as we describe in a new issue brief on the topic, the Committee proposed borrowing even more money, further increasing one-shot revenues, and boosting estimates of how much revenue would be generated by proposals already in the Governor’s budget.

Two years ago, the General Assembly and Governor budgeted based on the assumption that our economy would recover strongly and refill the state’s coffers with new tax revenues. Unfortunately, the robust recovery never materialized, and we were left with over $2 billion in deficits going into the next two-year budget, which starts July 1.

The Governor and Finance Committee are placing the same bets for the next two years. The Governor proposes to borrow $750 million and cut vital public services in the hopes that the economy will recover and we will be able to pay down those debts and restore those services. The Finance Committee goes one step further, proposing over $900 million in borrowing.  While the Appropriations Committee has restored funding for some vital services in its spending package, the Finance Committee’s revenue proposal puts the future stability of funding for child and family services at risk.

It does not have to be this way. The General Assembly still has time to balance the package of borrowing and cuts currently being advanced with additional revenues. Closing corporate tax loopholes through mandatory combined reporting could generate about $90 million per year, while raising income taxes on income over $1 million could generate over $400 million annually and still keep our rates below New York’s. These two changes could more than offset the Finance Committee’s proposal to borrow $900 million over two years, and would do so without leaving our children an even heavier debt burden.

Issue Area:

Budget and Tax

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