Skip to main content

Currently Skimming:

5 Current Financing for Early Care and Education: Ensuring High Quality Across Settings
Pages 135-156

The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.


From page 135...
... Next, the chapter discusses the committee's fifth principle and examines the current financing mechanisms available to support the building and maintenance of quality ECE facilities, which are important for ensuring delivery of high-quality early care and education. Finally, the chapter concludes by examining the current financing mechanisms that support ongoing accountability, evaluation, and continuous improvement in early care and education, the committee's sixth principle.
From page 136...
... However, providers that accept children who are eligible for different types of funding (e.g., some receive Head Start funding and others receive funding through ECE assistance programs) currently face the challenge of managing sources that have different program standards and family eligibility requirements (see further discussion below, under "Licensing, Monitoring, and Regulation")
From page 137...
... States are required, however, to submit ECE program plans to the federal government to address systemlevel issues, including quality assurance. States also set reimbursement rates for ECE assistance programs, and these rates vary greatly by state.
From page 138...
... Typically, 2 Louisiana also provides refundable tax credits that are linked to quality for businesses that pay expenses to ECE facilities with a Quality Start rating of at least two stars and for ECE providers whose facilities are rated two stars or higher (ChangeLab Solutions, 2016)
From page 139...
... Many providers lack secure funding that would allow them to maintain stable operations and invest in quality improvements. PRINCIPLE 4: VARIETY OF HIGH-QUALITY SERVICE OPTIONS This section analyzes provider-oriented and family-oriented mechanisms against the committee's fourth principle: High-quality early care and education requires a variety of high-quality service delivery options that are financially sustainable.
From page 140...
... Summary: Principle 4 -- Variety of High-Quality Service Delivery Options In summary, family-oriented financing mechanisms as currently used give families more discretion for deciding which type of ECE service option to use. However, there are a number of challenges related to such discretion, including the potential for parents to prioritize program attributes other than high quality.
From page 141...
... Some ECE providers may need funds for acquiring new facilities and maintaining, expanding, and improving existing facilities. In contrast to the K–12 system, there is no dedicated financing mechanism for ECE facilities.
From page 142...
... Some states have developed innovative strategies to help businesses access and manage loans, including loan guarantees, direct loans, debt service support, and performance-based loan forgiveness. Some of these programs are specific to ECE providers, whereas others are geared toward helping small, nonprofit, or otherwise needy businesses in general.
From page 143...
... partnered with the state to guarantee loans to ECE providers using federal block grants from CCDF. Self Help, Inc.'s lending aimed to help home-based ECE providers and small ECE centers access capital to make improvements (Sussman and Gillman, 2007)
From page 144...
... administers the North Carolina Department of Health and Human Service's Child Care Revolving Loan Fund.3 This program ties loan forgiveness to quality improvement standards. Providers who maintain or increase the quality of their program, as measured by the state's quality rating system, qualify for partial loan forgiveness amounting to between 30 and 50 percent of their loan principal after 4 years.
From page 145...
... Given the high rents in this county, ECE providers struggle to offer affordable quality early care and education; the county hopes that addressing ECE facilities in this way will alleviate the cost burden on families (Montgomery County Department of Health and Human Services, 2017)
From page 146...
... Summary: Principle 5 -- Financing for High-Quality Facilities This section considered whether current financing is available and adequate to sustain quality facilities and whether current mechanisms are easy for providers to navigate and administer. While financing may be available for ongoing facilities costs as part of the cost of service delivery for some providers, in situations where support for building and improving ECE facilities is required, no systemwide approach for addressing facilities exists.
From page 147...
... This section analyzes the financing mechanisms currently available to support quality assurance and improvement systems. It examines whether sustainable funds are available for planning and designing accountability systems and for monitoring and evaluations systems that promote systemwide quality improvements and whether financing is available to support accountability at the educator, program, and system levels.
From page 148...
... State-funded prekindergarten programs were more likely to be included in the state systems than were subsidized ECE or Head Start programs. These linked data systems provide a foundation, but their limitations severely curtail the utility of current data collection efforts as a tool for quality improvement efforts.
From page 149...
... At the federal level, the Bureau of Labor Statistics and the National Survey of Early Care and Education report data on the number and salaries of ECE professionals (Bureau of Labor Statistics, 2016; National Survey of Early Care and Education Project Team, 2013)
From page 150...
... Similar state systems tend to be funded either through short-term grants or through federal quality improvement funds with state matches, rather than through dedicated financing mechanisms for data collection. Summary The financing for data collection systems tends to be through shortterm or one-time funding initiatives, contributing to the dearth of data collection systems able to answer the most basic questions about early care and education and to track improvement and changes over time.
From page 151...
... Because of the inadequacy of each funding source to support the full cost of an ECE program, ECE providers often receive funding from multiple sources, requiring them to blend, braid, stack, and leverage multiple sources of revenue. In fact, 75 percent of providers report receiving and using multiple revenue streams to cover the cost of delivering services, which means that these ECE providers are regulated and monitored by multiple agencies or authorities, each of which carries its own purpose, regulatory rules, reporting requirements, and monitoring system (Maxwell et al., 2016)
From page 152...
... Moreover, if the requirements across these funding streams are inconsistent, additional inefficiencies will result. A lack of incentives or resources for coordinated monitoring systems may also contribute to the current focus on compliance rather than on continuous quality improvement.
From page 153...
... Some argue that QRISs are expensive and that limited funds may be better used within ECE programs.7 The QRIS model has been validated by studies performed by states that received funding from RTT-ELC grants, which required states to research the relationship between rating levels and program quality and between rating levels and improved outcomes for children. Taken as a whole, these studies show a positive relationship in some 7 See, e.g., https://www.washingtonpolicy.org/publications/detail/qris-rating-systems-do-not improve-learning-or-social-development-of-children [January 2018]
From page 154...
... In addition to strengthening QRISs already in existence, additional alternative approaches to accountability and improvement systems could be explored. Summary: Principle 6 -- Systems for Accountability, Quality Assurance, and Improvement In this section, the committee analyzes current financing mechanisms available to support quality assurance and improvement systems, determining whether sustainable funds are available and adequate for planning and designing accountability systems and for monitoring and evaluation systems that promote systemwide quality improvements.
From page 155...
... The inadequacies of the current financing structure stem not necessarily from having multiple financing mechanisms but from these mechanisms neither being harmonized in ways that avoid gaps in access nor structured to improve ECE service quality. These flaws are exacerbated by overall levels of funding that are not sufficient to support either provision of high-quality early care and education or its affordability by families at all income levels (see Chapter 6)


This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More information on Chapter Skim is available.