California Preschool Planning Toolkit Budget and ... - Karen Hill Scott

California Preschool Planning ToolkitProcess7Budget andLaunchProjectionsNeedsFacilitiesSystemsEngagementProgramFinancebyA Project Funded by the David and Lucile Packard Foundation

Budget and Phase-InOVERVIEWThe goal of this section is to offer a practical method to estimate the local cost of implementing a qualitypreschool program accessible to all on a “system-wide” basis, such as within a county, city, or schooldistrict(s).The approach recommended here involves the use of a model originally developed by the Institute forWomen’s Policy Research (IWPR) and Early Childhood Policy Research (ECPR) for states to estimatethe cost of implementing universal preschool. The American Institutes for Research (AIR) adapted thismodel to the development of local cost estimates, as described in the First 5 California Preschool for AllToolkit and Developing a Local Preschool for All Plan located on the First 5 California website (see linksunder Resources).Although the complete model is composed of two categories, direct service costs and infrastructurecosts, this section focuses on the direct service costs likely to be encountered by preschoolimplementers locally. See Section 3 for how to estimate the cost of workforce development and Section 4for how to assess the cost of facilities.The model assumes that the majority of direct service costs related to program implementation will beupgrading the compensation of early education teachers as they obtain educational qualifications similarto those of elementary school teachers. Given current California policy as of the writing of this Toolkit, thegoal of this section is to help counties budget for improved quality of preschool, moving towards universalaccess with an incremental approach. The approach is incremental in two ways: First, the increase inteacher qualifications and compensation is phased in, because existing teachers cannot be expected toobtain bachelor’s or associate’s degrees overnight. Second, the approach is incremental because accessto new or upgraded preschool spaces takes place gradually, as resources are available to finance them.Developing a plan for phasing in preschool is thus an important part of the planning process. Samplephase-in plans are included in this Toolkit that extend five, eight, and ten years, but individual localitiesmay use the same approach to cover any time span. Since AB 172 will provide some funds forexpanding preschool in attendance areas for low API schools (deciles 1-3), it is recommended thatcounties focus their plans on these areas first.Before costs can be estimated and a phase-in plan developed, a Needs Assessment (see Section 2)must be completed. Data from the needs assessment will be used to determine the number of new andupgraded spaces needed, and the areas with low API schools and a relatively greater need for newspaces. This data, along with the estimated per child cost of new and upgraded spaces can be used tocreate a budget, and ultimately to determine the length of time necessary to phase in access to a qualitypreschool program for all four-year-olds (the same model could be used to develop a plan that includedthree-year-olds as well). An accurate budget and well-thought-out phase-in plan are critical to thesuccess of a preschool initiative.The California Preschool Planning Toolkit: October 20061

Budget and Phase-InPRINCIPLES AND GUIDELINESThe principles and criteria below may help shape your program and budget development.Relevant Preschool California Principles:Financing Will Support the Cost of Quality ProgramsPrograms will be sufficiently funded to meet the real cost of a quality early childhood education. Thisincludes meeting established standards, providing comparable pay and benefits for qualified teachers,establishing accessible higher education opportunities for the preparation of the workforce, developingsuitable preschool facilities, and engaging in ongoing quality assessments. Financing of preschoolshould not detract from funding for infants, toddlers, and school-age children, or from child care subsidiesthat help low-income families to work.SAMPLE APPROACHESCalifornia Approaches:California has numerous examples of counties that are phasing in quality preschool. Los Angeles Countyhas developed a five star system quality rating system for preschool programs, with programs with threeto five stars eligible to apply to participate in Los Angeles Universal Preschool (LAUP), with more starsrepresenting higher quality, especially in teacher qualifications, and qualifying for a higher rate ofreimbursement. A description of the star system is included in the Quality section of this Toolkit, andreimbursement rates are included in this section.First 5 Power of Preschool (PoP) demonstration grants also offer three levels of reimbursement—Entry,Advancing and Full Quality. Tables showing current reimbursement rates from two PoP grant counties,San Francisco and San Mateo, are also included in this section.Experiences in Other States:Participation RatesIn Oklahoma and Georgia, the only two states that have fully implemented voluntary universal preschool,participation rates are around 70 percent in the publicly funded preschool program and collaboratingHead Start programs. However, the total enrollment of four-year-olds in some kind of formal earlyeducation and care, including private programs unaffiliated with the state preschool program, is estimatedto be higher, and participation also varies by county.The California Preschool Planning Toolkit: October 20062

Budget and Phase-InExpenditures per ChildState expenditures for preschool vary substantially, based on teacher qualifications, teachercompensation, and program duration. For a rating of states on reimbursement levels, see the StatePreschool Yearbook published by the National Institute for Early Education Research (link included in theresource list below).BASIC ISSUES AND INSTRUCTIONSBelow is a brief list of the basic instructions for estimating the cost of preschool in your county:1. Understand the current budgets of existing publicly-funded preschool providers, such as StatePreschool and Head Start. Create “before” budgets.2. Determine the teacher qualifications you want.3. Determine teacher salaries. Counties often use beginning K-12 salaries or average kindergartenteacher salaries.4. Set teacher/child ratios.5. Using the above teacher qualifications, ratios, and salaries, create “after” budgets: the full cost ofa preschool program that meets your PFA standards.6. For existing public programs who will participate, calculate the difference in cost per childbetween the “before” and “after” budgets.7. Determine the number of children you project will participate in the PFA program in your county.8. Determine the number of children already served in existing participating programs (from yourneeds assessment sheet).9. Calculate cost of full implementation.10. Develop a feasible phase-in plan, by gradually ramping up teacher salaries and/or participationrates.For more complete instructions, see “How to Estimate a Budget and Phase-In Plan” in the Toolsand Templates section in the materials in this section of the Toolkit.TOOLS AND TEMPLATES1. How to Estimate a Budget and Phase-In PlanOTHER RESOURCES1. Examples of provider budgets (included)2. Examples of phase-in plans (included)3. Examples of tiered reimbursement rates (included)4. County-specific data on certificated salaries by school district available athttp://www.cde.ca.gov/ds/fd/cs/documents/j90summary0405.doc or interactively at http://www.ed-The California Preschool Planning Toolkit: October 20063

Budget and Phase-Indata.k12.ca.us/navigation/fstwopanel.asp?bottom=/fiscal/fundingsummary.asp%3Flevel%3D06%26fyr%3Dcurrent%26reportnumber%3D45. Preschool for All: Step by Step, A Planning Guide and Toolkit, Section 4: Estimating the LocalCost of Preschool for All; developed by American Institutes for Research for First 5 California;http://www.ccfc.ca.gov/PDF/SRI/Section4.pdf6. Developing A Local Preschool for All Plan; developed by American Institutes for Research forFirst 5 California; http://www.ccfc.ca.gov/PFA.htm7. Orchestrating Access to Affordable, High-Quality Early Care and Education for All YoungChildren, Human Services Policy Center, University of Washington, 2004;http://www.hspc.org/publications/pdf/OrchestratingReport.pdf8. How Much Does Quality Preschool Cost? W. Steven Barnett & Kenneth B. Robin, NationalInstitute for Early Education Research, 2006, athttp://nieer.org/resources/research/CostOfEffectivePreschool.pdf9. The 2005 State Preschool Yearbook, the National Institute for Early Education Research.Rutgers, the State University of New Jersey. http://nieer.org/yearbook/The California Preschool Planning Toolkit: October 20064