Blue Ribbon Commission on affordable child care issues report

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Blue Ribbon Commission on affordable child care issues report

Fri, 12/09/2016 - 3:37pm -- tim

A copy of the final report can be found on the Commission’s webpage:

Vermont Business Magazine Child care in Vermont costs too much and workers get paid too little. A report released today on early child care in Vermont says that equitable early care and learning for all Vermont children ages birth to five is the most significant opportunity for the state to make systemic and dynamic improvements that will foster economic development, advance social and community well-being, and provide the greatest positive impact for future generations. The report also suggests that the state nearly double its investment to just over $90 million (the current budget for CCFAP in State Fiscal Year 2017 is $47.3 million; an additional $43.5 million would be needed to fund the proposed changes.)

The Blue Ribbon Commission on Financing High Quality, Affordable Child Care has concluded its 15-month long research into Vermont’s current early care and learning system. The Commission first convened in September 2015 and its 15 members were statutorily charged with determining what high quality programs in Vermont look like currently, what components of high quality programs should be included in the future, determining family affordability for that highest level of quality, and putting forth financing recommendations to the Legislature and incoming Administration.

Nationally, Vermont ranks as the 13th least-affordable state for infant care, and 3rd least-affordable for 4-year old care. Before any tuition assistance, Vermont families pay anywhere between 25 percent and 53 percent of their income to send an infant and a 4-year old to full-time, center-based care. Vermont is also experiencing a childcare shortage: 47 percent of infants and toddlers likely to need care, do not have access to any regulated programs, and 79 percent don’t have access to programs recognized as high quality. A high quality early care and learning system not only provides children with a strong foundation in their early years, it is also intricately woven with small businesses, parents, and providers who strengthen and contribute to the economy.

In recent years, Vermont has focused on investing in young children through strategic investment in resources and time toward early care and learning. Key accomplishments include, but are not limited to, the development of Vermont’s Early Childhood Framework and Action Plan,1 the implementation of the STARS quality rating and improvement system, the passage of Act 166, universal prekindergarten, and receipt and implementation of initiatives through the $36.9 million Federal Race to the Top Early Learning Challenge Grant.4 Vermont made great strides towards investing in early care and learning, the Commission believes the state can do more. The Commission’s work aligns with the Early Childhood Framework and Action plan and efforts to provide equal access to high quality care for all children birth to five in Vermont.

Vermont’s policymakers and citizens have a clear course for shaping the future of the state’s economy and the health and well-being of families through strategic investments in high quality affordable early care and learning. Investment in early care and learning is good for Vermont. Businesses benefit by employing parents who can focus on work because they are assured their children are in a safe, nurturing setting. Moreover, young children, the future workforce, are developing a critical foundation for success.

Child care is not just babysitting; it is critical learning and development for future generations. The science is clear, high quality early care and learning matters:

  • In the first few years of life, 700-1,000 new neural connections are formed every second- this is the foundation upon which all learning, behavior and health depend;5
  • At 18 months of age, disparities in vocabulary begin to appear for children not exposed to high quality care;
  • 90-100 percent chance of development delays when children experience multiple risk factors of maltreatment;6
  • Children who face significant adverse experiences (more than 7-8) have 3:1 odds of adult heart disease after adverse childhood experiences;7 and
  • $4-9 in returns for every dollar invested in early childhood programs.

The Commission’s report seeks to provide a clear definition of high quality child care, the estimated cost of providing that care to all Vermont children birth through the age 5, and a clear picture on the major gap in investment to support equal access to high quality care.

The Commission reports that early care and learning is critical to the economic and community wellbeing of Vermont. Every dollar spent on high-quality early care and learning programs yields a return on investment that ranges from $4 - $9. Currently there are over 36,000 children birth to age 5 in Vermont: 6,023 infants, 12,224 toddlers, and 18,360 preschoolers. These children and families have access to approximately 1,500 licensed and registered programs (46% center-based, 54% home-based).

As of July 2016, 31.9% of all early care and learning programs have a 4 or 5 STAR high quality designation. Nearly half (47%) of all infants and toddlers likely-to-need-care do not have access to any regulated early care program. Currently Vermont spends $130 million through state and federal investments. Families, who pay both taxes and tuition, are the primary source of funding for the system. The Child Care Financial Assistance Program (CCFAP) subsidizes 23% of families seeking regulated care. The remaining roughly 75% of families pay full tuition.

On the provider side, a March 2013 survey showed that 14.2% of providers do not charge a co-payment to any family receiving financial assistance. An additional 27.6% only charge under certain circumstances. Moreover, 65.2% of providers provide additional financial support (like scholarships or lowered co-payments) or work with families to determine payments that are affordable. These financial supports reduce the income of the business, limiting providers’ ability to pay staff, buy supplies, or support quality improvements.

Compared nationally, Vermont ranked 13th least affordable for center-based infant care and 3rd least affordable for center-based four-year-old care. Furthermore, parents across the state report difficulty accessing early care and learning programs, let alone high quality programs.


Recommendation 1: Make Immediate Incremental Investments in High-Quality, Affordable Early Care and Learning

It is the recommendation of the Commission that the state immediately begin to make annual incremental investments to support high-quality, affordable early care and learning. To support the further development of quality and access in the state’s early care and learning system, the Commission recommends the following strategies:

a. To improve financial access and stability, adjust Vermont’s Child Care Financial Assistance Program (CCFAP) in the following way:
i. Set the 4-STAR Rate at the 75th percentile of 2015 market rates and adjust accordingly the current tiered system methodology which incentivizes quality91
ii. Provide 100% benefit at the 200% Federal Poverty Level (FPL)
iii. Provide 50% benefit at the 300% FPL
iv. Provide 0% benefit at the 350% FPL

The Vermont Department of Children and Families Child Development Division modeled what these changes would mean. Using U.S. Census data, they estimated that all the families currently eligible for CCFAP would now qualify for 100% of the benefit. An additional 1,000 families with infants, toddlers, and preschoolers would qualify for 100% benefit. An additional 3,920 families with infants, toddlers, and preschoolers and 1,344 families with school-aged children would qualify for between the 99% and 10% benefit level. CCFAP rates would increase from the rates published on Aug 21, 2016 by 27% on average for licensed centers and 16% on average for registered providers. The estimated cost per year for this benefit level is $90.8 million. The current budget for CCFAP in State Fiscal Year 2017 is $47.3 million. An additional $43.5 million would be needed to fund these changes.

b. To increase capacity and quality environments, establish a facilities fund to be maintained by the Vermont Community Loan Fund that includes, but is not solely funded by, the Building Bright Futures license plate revenue. Minimal annual allocation should be at least $3 million to include both grants and loans.
c. Vermont’s early care and learning professionals face a unique set of challenges, including significant disparity between their wages and benefits and those of other education professionals with similar qualifications. To make early care and learning a sustainable profession, providers need compensation that is aligned with their education, skills, and expertise. To support early childhood professionals and strengthen the early childhood workforce:
i. Establish a range of "Outstanding Early Childhood Professional" recognitions that are substantial enough to incentivize providers to enter and stay in the workforce;
ii. Establish and fund a W.A.G.E.$® program that assures private sector programs can recruit and retain highly qualified staff 92;
iii. Permanently establish a leadership institute or program to strong, ongoing, committed leaders in the early childhood system;
iv. Establish pathways to credentials and licensure:

  • Locally enhanced higher education coursework and accredited opportunities

  • Portfolio development and assessment of prior learning

  • Provider support through mentoring, coaching, teaching and assisting;

v. Establish a scholarship fund robust enough to incentivize pursuing a degree in Early Childhood Education. Link this to the T.E.A.C.H.® support already in place.93

  • Scholarships for educational advancement toward degree attainment

  • Incentives that promote social and emotional competence and literacy

  • Supports for “relief time” for schooling and coursework.

d. Educate employers about ways to support employees in affording quality early care and learning programs, such as offering a matching contribution fund that allows employees to dedicate pre-tax dollars to early care and learning programs. Consider developing an “Early Care and Learning for Businesses” handout.

Recommendation 2: Design and Implement Vermont’s Future Early Care and Learning System for Children Birth – Five

The Commission recommends engaging Vermont’s early care and learning stakeholders, including members of Vermont’s gubernatorial administration and state legislature, in a design process to develop a comprehensive, inclusive, voluntary, high-quality, affordable early childhood system for all children birth – five. Early care and learning is a complex arena with many stakeholders. It is a cross agency and community issue that involves multiple disciplines including health, mental health, education, child nutrition, special needs services, and social services. Developing a high quality integrated system of early care and learning requires a joint birth to five systems strategy that creates a seamless continuum of high quality early care and learning opportunities across Vermont’s early childhood system. While this Commission addressed pieces of the work, state- and district-level costs related to administration, monitoring, distribution of resources, and staffing were not explored. To meet the needs of all Vermont’s children and their families, further conversation and research are needed to fully explore and design a system that considers delivery, funding, governance, and achieving economies of scale. The goal is to determine the totality of available resources and how to better drive them into direct service.

a. The Commission recommends that the state’s early childhood public/private partnership facilitates a statewide effort to explore and develop recommendations for a comprehensive integrated early care and learning system. Building Bright Futures (BBF), the State’s Early Childhood Advisory Council to the Governor, Administration, and Legislature in Vermont, is well positioned to lead this initiative. Through Act 104, Building Bright Futures has the authority and duty to convene members of the early care and learning community, medical community, education community, and other organizations, as well as state agencies serving young children, to ensure that families receive quality services in the most efficient and cost-effective manner.94 Stakeholders in the process should include representation from across the early childhood system.

Moreover, to capitalize on substantial shared learning, the process should also include representation from this Blue-Ribbon Commission. The process should begin early in 2017, take place in a timeline that recognizes the urgency of this issue, and conclude in time to deliver proposed legislation to the state legislature no later than January 2019. The Commission recommends appropriating funding for the project, though not in place of the immediate direct service investment needs outlined in Recommendation 1.
b. The Commission recommends a comprehensive examination of the early care and learning system and related programs. The project should aim to develop a future system of integrated early care and learning that maximizes existing resources and provides high quality efficiently and effectively. The Commission recommends that the project focus on the following topics:
i. Achieving affordability for families and for the state. Consider state- and district-level costs associated with administration, monitoring, distribution of resources and staffing. Also, consider the relationship between delivery costs and economies of scale;
ii. Maximizing current wrap-around comprehensive services including healthcare, mental health, services for children with special needs, and families with social service needs;
iii. Maximizing available services and professional development to support and retain high quality early childhood professionals;
iv. Exploring a shared services model that leverages economies of scale to decrease the cost to providers of providing high quality early care and learning;
v. Leveraging transportation services to reduce the barriers for families in need;
vi. Exploring the infrastructure and capacity of the K-12 system and other community facilities to increase the supply of high quality preschools.
c. Learn from Others: While this Commission reviewed a substantial amount of information about early care and learning systems around the world, a growing number of states and municipalities offer a range of voluntary, high-quality, affordable early care or early learning systems. The stakeholder group should review analyses of programs and best practices from across the United States and other applicable areas. There are important lessons to be learned from the successes and failures of others that can inform Vermont’s efforts. Please refer to the appendices of this report for an index of resources and references that can serve as a starting point for this work.
d. Ensure equity: The Commission had rich discussions about the need to ensure equity in access and affordability to early care and learning programs. The BRC feels it is important to specifically recommend that any policy or policies that result from the work of the design group are equitable and that they do not create barriers for families to access or afford high-quality early care and learning programs.
e. Family and Community Member Engagement in the Design Process: Based on the experience of this Commission, broad family and community engagement should be incorporated into the design process. It is critical for the thoughts and opinions of all Vermonters to inform this important work.

III. Recommendation 3: Financing Mechanisms

The Commission discussed a range of financing options. Though Commissioners all strongly agree that investments in early care and learning represent the most significant opportunity to greatly impact long-term dynamic and systemic improvements in Vermont’s economic development and social and community wellbeing, the BRC fully acknowledges the tension between the need to support Vermont’s children and families and the broader economic and budgetary realities of the state. This report includes recommendations for immediate changes that will have a significant and positive impact on the system as it is currently designed. These changes, however, do not achieve equitable access to true high-quality, affordable early care and learning in Vermont. It is the Commission’s hope that recommending a comprehensive examination of system improvements, delivery methods, and efficiencies will continue the exploration of how to achieve that very important goal, and pave the way for the implementation of more publicly supported impactful investments down the road.

It is the recommendation of this Commission that the Vermont Legislature review and act on the following list of potential financing mechanisms to support Vermont’s early care and learning system.

a. Reallocation of savings across all state agencies through operational efficiencies
b. Business and philanthropic community partnerships and incentives
i. Public-Private Partnerships
ii. Pay for Success
iii. Philanthropic Investments
c. Early care and learning license plates
d. Endowment funds
e. Leveraging additional funding from Medicaid through the global commitment waiver
f. Exploring options for other revenue sources

The Agency of Administration and Secretary Trey Martin oversaw the work of the Commission. “I want to thank the Commission for their hard work looking at how to improve early care and learning in Vermont. In the last six years under Governor Shumlin, Vermont has made significant investments in the early care and learning system. The Blue Ribbon Commission report offers immediate and long term actions that the next Administration and Legislature can consider to make high quality early care and learning more affordable for families.”          

Charlotte Ancel, Commission Chair

Green Mountain Power

VP, Power Supply & General Counsel

Sarah Squirrell, Commission Member

Building Bright Futures

Executive Director

Gubernatorial Appointees / Statutory Position :

Steven Lambrecht – Military Parent with Child Enrolled in Program
Charlotte Ancel – Chair & Business Representative
Donna Bailey – PCC Representative
Paul Behrman – Head Start Representative
Laurel Bongiorno – Higher Education Representative
Frank Cioffi – Business Representative
Michelle Fay – Child Advocacy Representative
Rachel Hunter – Licensed and Registered Home-Based Program Representative
Chloe Learey – Licensed Center-Based Program Representative
David Rubel – Financial Services Industry Representative
Lauren Norford – Business Representative

Statutory Members :
Rebecca Holcombe – Agency of Education Representative
Jessica Gingras – Agency of Administration Representative
Reeva Murphy – DCF/CDD Representative
Paul Dragon – Agency of Human Services Representative

Source: Agency of Administration 12.9.2016 A copy of the final report can be found on the Commission’s webpage: