Issues to Consider in Developing a Preschool Factor for State School Finance Systems

Issues to Consider in Developing a Finance System for PreschoolLori Goodwin-Bowers Colorado Preschool Program Supervisor, CDECharlotte Brantley President and CEO, Clayton Early Learning John Augenblick Partner, Augenblick, Palaich and AssociatesNovember 8, 2011

Early Childhood Education in Colorado: The Colorado Preschool Program

Lori Goodwin-Bowers Colorado Preschool Program Supervisor, CDEColorado Preschool ProgramThe Colorado Preschool Program was created in 1988 to address the needs of children who may not be prepared to be successful in school.

Authorized by the legislature to serve 20,160 at-risk children (about 28% of CO four-year-olds)CPP is voluntary for school districts, 170 of 178 districts in Colorado as well as the Charter School Institute participate in the program.Each slot is funded at .5 PPR in the School Finance Formula

3CPP Enrollment over the Last Few Years(39.2%)(42.7%)(48.0%)Colorado State Demography Office

* Orange line represents the percentage of pupils eligible for free and reduced price meals in Grades 1-8 as reported in the annual pupil membership count for the identified years.* While the number of children CPP has been authorized to serve has remained flat in recent years, the proportion of children eligible for free/reduced-price lunch has grown. Moreover, the overall population of four-year-olds has grown by about one thousand since 2008.

4Estimate of Total Population Served by Colorado Preschool Program, Early Childhood Special Education and Head Start Source: NIEER, 2009, The State of Preschool 2009 Children in Other/None category may participate in early childhood programs through other funding sources, for example parent tuition, Child Care Assistance Program, or private grants and donations. While we can measure progress for children in CPP and Special Education, there is no systematic way to trace outcomes on a state level for children funded by other early childhood funding sources (unless they are in a program voluntarily participating in Results Matter).5Important Features of CPP: Locally appointed District Advisory Councils advise the school district in the implementation of the program. Including:Recommending a plan for delivery of servicesMonitoring programs at least twice a year using the Quality StandardsCoordinating family support services and extended day servicesOverseeing the determination of eligibility

CPPs Delivery SystemType of Delivery System2010-2011Number of School DistrictsPercentageCPP district councils with no other licensed preschool or child care center in the community.6236.7%CPP district councils that contract out all allocated slots4023.7%CPP district councils that provide services in both community and public school settings4224.9%CPP district councils where other community providers exist but do not contract with CPP.2514.8%CPP Children are Served in 67.4% of the licensed preschools in the state.CPP Children are Served in 19.6% of the licensed child care centers in the state.

Class size is limited to 16 children with a one to eight adult to child ratio. Preschool offered 10 hours per week Teachers must have core coursework in early childhood education, child development and family engagement.CPP funds 90 hours per year for teacher planning, child assessment, training, and family support activities.Family involvement and support are requiredChild outcomes measured through Results MatterMore Important Features of CPP:Programs Serving CPP Children Must Use the Quality StandardsInteraction Among Staff and ChildrenCurriculumFamily/Staff PartnershipStaff Qualifications and DevelopmentAdministrationStaffing PatternsRole and Function of the Teaching TeamPhysical EnvironmentHealth and SafetyNutrition and Food ServiceEvaluationRelationship of Slot Allocations to Funding per SlotFunding Sources Used to Provide Quality Comprehensive Education to PreschoolersEarly Childhood Special Education Funding Parent TuitionDistrict General FundHead StartGrants and FoundationsChild Care Assistance Program (CCAP)

School Readiness GrantUSDA Child and Adult Care Food ProgramTitle ICommunity ContributionsFundraisingLocal Service ClubsBenefits of CPP:CPP children make faster progress in preschool than their more advantaged peers and the amount they are behind narrows before they enter kindergarten.

CPP children are more likely to be identified as at or above grade level in literacy in kindergarten through third grade than other at-risk children who did not attend CPP.

Across 3rd through 5th grade, in all three subject areas, more CPP children were proficient or advanced than other at-risk children who did not attend CPP.

In kindergarten through 3rd grade, CPP reduces the need for retention- in kindergarten by as much as one-half - thus saving taxpayer money.

2011 Legislative Report

Colorado Preschool ProgramWorking Together

Retention RatesRetention rate cut in half!As you can see in this chart, kindergarten and first graders are most likely to be retained. 13Two Ways Early Childhood Students Are Included in the School Finance Pupil Membership Count in ColoradoColorado Preschool ProgramEarly Childhood Special EducationEligibilityChildren qualify under legislatively defined risk factors.Every participating district has a CPP allocationAll preschool students with a disabling condition have a right to services and may be counted if they are eligibleMinimum Age3-year-olds must have 3 risk factors and turn 3 by October 14 or 5-year-olds may qualify with one risk factor and must turn 4 by October 1Students must reach 3 during the semester of the official count dateColorado Preschool ProgramEarly Childhood Special EducationFundingState:.5 per pupil revenue(FY 2010-11: $70,588,974)

State:.5 per pupil revenue(FY 2010-11: $23,598,714)State Categorical Funds for Special Education Programs Under the Exceptional Childrens Educational Act (ECEA)Federal:IDEA Part B allocationIDEA, Section 619 preschool allocationFTEMost children are counted as half-day pupils (.5 FTE)Districts may apply for the flexibility to fund a child using two CPP slots. Only 5% of the slots in CPP can be used for full-day programs.All children are counted as half-day pupils (.5 FTE)Colorado Preschool Program FundingColorado Preschool ProgramEarly Childhood Special EducationNumbers Served in 10-1120,160 slots

6,944 childrenHow PPR Funds Can Be UsedDefined in statute (22-28-108 (5.5) C.R.S.). Costs that a district would not have incurred without the services provided in conjunction with the preschool programOverhead limited to 5%Revenues and expenses reported by district in ADE Financial Data SubmissionsNo guidance provided on use of per pupil revenue Trends in CPP Funding Over Last Three YearsThe Fabric of Early Childhood Education

Charlotte Brantley - President and CEO, Clayton Early Learning

The Fabric of Early Childhood Education at the Community LevelCPP is one critical componentIn many communities, other components include Early Head Start (federal),Head Start (federal),the Child Care Assistance Program (federal + state), local tax-funded programs (e.g., the Denver Preschool Program DPP), and tuition-based child care and preschool programsCharacteristics of ComponentsSome programs/funding streams target high need children, such as low-income and other risk factors, or specific age groups, such as 4 year oldsSome operate only in center-based settings, while others also fund family child care settingsSome require specific program quality indicators or performance standardsSome focus primarily on the child, while others have a more comprehensive family focus The Fabric of Early Childhood Education from the Childs Point of ViewIn the period from birth to kindergarten entry, an individual child might be enrolled in several of these components, often simultaneouslyAn estimated 240,000 + Colorado children in this age range have parents in the workforceFamilies weave together these ECE components, many of which are part day, to form the whole day needed to support their childrens health, safety and school readiness while the parents are at work

The Fabric of Early Childhood Education from the Providers Point of ViewJust as families weave these components, providers often weave them when policies allowThe resulting blended or braided funding streams create comprehensive programs that meet multiple needs of children and their families in one locationFor example, embedding CPP within a community-based licensed child care program supports enhanced focus on early learning while eliminating the need to move children from site to site during the parents work dayThe Economic and Social Underpinnings of the Early Childhood Education FabricThe US approach to ECE has evolved over decadesThe most compelling identified need for programs has differed from era to eraFor example, during WWII, as women were encouraged to enter the workforce, the companion need for child care established a focus primarily on health and safety of children while parents workedThe 60s political focus on the Great Society resulted in establishment of Head Start to address school readiness of poor childrenThe Economic and Social Underpinnings of the Early Childhood Education FabricIn the late 70s and 80s states began to establish a year of readiness programming prior to kindergarten entry, most focusing on high need childrenAs more and more mothers entered the workforce in the past few decades, the number of child care programs grew exponentiallyThis pattern of program creation in response to one compelling need or another has resulted in the often fragmented non-system of a system we see today The Funding ChallengeIn large part, funding has not kept pace with the expansion of need and the expansion of programsNot one of the multiple funding sources (federal, state, parent paid tuition) currently covers the real cost of early childhood educationIn addition, many funding streams were designed to provide only a few hours of programming (e.g., 10 hours a week for CPP), not recognizing the family need for program hours that match the parents work scheduleThe Starting Early Challenge A growing body of research evidence supports the critical importance of starting a comprehensive early learning focus well before kindergarten entry, particularly for high need childrenResults driven programs for infants and toddlers have proven outcomes, and are the most expensive to provide due primarily to the required staff to child ratios (ideally three teachers to 8 children)

The Starting Early Challenge

School Readiness Scores (English Bracken) of Kindergarten Bound Children by Age of Entry into Educare All Sites, Adjusted, 2007-09

The Starting Early Challenge from a Community ECE Fabric PerspectiveDespite the compelling evidence of the previous slide, most programming for infants and toddlers is offered in community-based settings, and is paid for primarily by parents who are at the lowest earning levels of their adult lifeIn the most successful financing models, infant/toddler programming is combined with programming for preschoolers to leverage the dollars available

Early Childhood Education and School Finance Systems

John Augenblick Partner, Augenblick, Palaich and AssociatesThe General Structure of School Finance SystemsMost states use some form of a foundation program to allocate the majority of state current operating aid not capital aid to school districts.Under a foundation program, the state determines how much revenue school districts should have based on numbers of students, student characteristics, and district characteristics.The state then equalizes aid by deducting local revenue from the total revenue districts should have.

How Students are Differentiated in State Aid SystemsMost foundation formulas are based on the dollars times students approach (e.g., $6,000 X 8,430 = $50,580,000).In determining how much revenue districts should have from state and local sources, states may differentiate the value of students based on:Grade level (e.g., .50 for K or cost weights for grade levels) Program (e.g., vocational education)Student characteristics such as: eligibility for free/reduced price lunch, gifted/talented, language needs, or participation in special educationIt Is Possible to Add Preschool Students to the SystemThe state could count students who participate in preschool just like students in any other grade.A variety of issues would arise:How to count studentsWhat cost (or relative cost weight) to apply to studentsWhether funds would be categorical or fungibleWhether funds would be equalizedWhether there would be programmatic requirementsHow to Count StudentsWhat ages would be counted? (e.g., four years old, three and four year olds, younger participants, etc.)Would all participants count or just some? (e.g., just those from low income families)Would students be counted as full-time or part-time (that is as 1.0 or something less than 1.0 if attending on less than a full-time basis)Would there be a cap on the number of students? Note: this age group may or may not be covered by state education clause language.

What Cost to Apply to Preschool StudentsThe same base cost as all other studentsThe actual cost of pre-school or a weight that is the ratio of that cost to the base costDifferential cost based on program quality (e.g., higher quality programs have a higher weight) Differential cost for three vs. four year old students (e.g., the cost differs between the two age groups)Direct education cost only or include the cost of wrap-around services as well?

Other ConsiderationsWould some portion of state funding (e.g., 85%) be required to be spent on preschool programs or would funds be fungible like most other funding?Usually, the cost of providing a service exceeds state aidIt is more difficult to require spending of state aid if it has been equalized so that districts receive different amounts of aid

Would private pre-school providers be eligible for state support? If so, how would wealth be taken into consideration? (e.g., districts count students served privately and pass through state, and local, support) Could tuition be charged? What, if any, restrictions apply?Programmatic Requirements Should the quality of preschool programs be rated (e.g., Qualistar)? Should standards be set for class size?Should teachers have to meet certain credit or degree requirements?Should teachers be paid on the same schedule as other teachers in the district?

Programmatic Requirements Should there be standards for facilities? Should funds be provided for districts that do not have appropriate facilities?Should a portion of slots be provided privately?Should districts be required to have plans demonstrating how they will work with private providers?

Funding Illustrations13 states and DC include preschool in their state aid formulas.Other states provide funding but outside the formula.States that do include preschool in their formulas do not require that districts actually provide preschool.Funding may be insufficient to meet demand either due to the weight given preschool children or a cap on the numbers eligible to receive state aid.Weights can conflate time and cost. That is .60 might mean students attending half time but cost weighted at 1.20 (50 X 1.20 = .60).

Funding IllustrationsStudent counting examples: Vermont, .46; Kansas, .50; Iowa, .60; Oklahoma, .70 (1.3 for full-time); West Virginia, variable depending on hours per week (25 hours = 1.0, 12 hours = .5)West Virginia requires that no less than 50% of the classrooms for eligible children must be provided through contractual agreements with community partners that can meet state quality standards.New Jersey has studied the cost of providing high quality preschool programs, which is higher than K-12 programs, but does not provide sufficient funding.

Chart1105.14104.498.433105.3496.39696.97195.47688.71798.76792.968

Childrens Home Language:English (n=332)Non-English (n=189)

Sheet1< 2 yrs2-3 yrs3-4 yrs4+ yrsAllEnglish (n=332)105.1498.43396.39695.47698.767Non-English (n=189)104.4105.3496.97188.71792.968