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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Orlando Rodriguez, M.A.

It is in everyone’s best interest to ensure that children living in low-income households are supported in achieving their full earnings potential.  One of the many reasons to support children is that they are our economic future – they will grow up to contribute to the state’s economic wealth and to pay taxes that support the social safety net for everyone.  Simply put, children from low-income backgrounds will buy more things and pay more taxes when allowed to reach their full economic potential. This is the topic of a new report from the number crunchers at the National Bureau of Economic Research (NBER).  Their results for the U.S. economy suggest that the state could reap benefits equivalent to 1.28 percent of total disposable income (consumer spending) if families with children who live in poverty received additional support, as more of their children would reach the earnings capacity of the typical child. Furthermore, this increase would be “in perpetuity,” which translates into more private sector jobs and additional tax revenues for state government -- forever.

How many more things would these children buy?  In 2011, personal income in Connecticut was nearly $204 billion, according to the Bureau of Economic Analysis. This study suggests that increasing the income of poor families could potentially generate benefits from additional future income from their children worth about $2.6 billion yearly. Furthermore, the research finds that we would not have to wait long to see the benefits, and middle- and high-income workers would also benefit from increasing economic success among children from low-income households. 

Unfortunately for Connecticut’s future, the percentage of children living in poverty in the state has increased from 10.2 percent in 2001 to 14.9 percent in 2011.  Unless this trend is reversed, we can expect relatively less consumer spending in the future, as more of the state’s consumers will have come from poor homes with lessened opportunities for attaining economic success, and less disposable income.  However, Connecticut’s future is not set in stone and we can increase future consumption, and jobs, by investing more in low-income children now with the prospects of their soon becoming well-paid workers with greater disposable income.

One strategy the NBER report suggests is to lower marginal tax rates for low-income parents, which would give these parents more money to benefit their kids, who will in turn grow up into well-paid workers with more money to spend in Connecticut, resulting in greater economic activity and more jobs for Connecticut residents. 

How much more would investment in children cost?  In a separate new report, the State Department of Education estimates that it would require an additional annual investment of $43.8 million to provide high-quality universal preschool for all low-income children in the state’s poorest districts (along with a one-time investment of $220.6 million for additional classrooms).  Providing universal preschool for all low-income children would be a wise investment towards increasing the economic potential of children living in poverty, and a prudent public investment towards increasing the state’s disposable income by $2.6 billion yearly.

Issue Areas:

Early Care, Family Economic Security

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