And How are the Children..?

IL Budget Crisis and Early Childhood Funding: An Overview

Posted on: March 22, 2010

Early childhood programs receive public money primarily in the form of education and human services dollars.  There is a complex filtration system that the money goes through, starting with government dollars, and at the end, flowing out to schools, child care subsidies, early intervention services and other public programs.  This money pays for more than the cost of a child’s pre-k tuition, or a physical therapy session.  It pays for salaries of people who provide and coordinate those services.  It pays for supplies that stock the buildings where these people work, and equipment used to support that work.  It pays for some of the education required for workers to continue to do their jobs well, maintain certifications and uphold licensing requirements.  It is an industry web comprising retail, business and repair, educational services, personal services (these are categories of industry according to the U.S. Census Bureau) and more.  According to Illinois Action for Children’s newly published report, Child Care & Early Education in the Cook County Economy (March, 2010):

  • At least 40,867 full-time equivalent jobs are generated by the child care and early education industry in Cook County…
  • Revenues of the child care and early education establishments in Cook County total approximately $1.2 billion.
  • These revenues are from private families’ purchases of child care and early education and from public purchases through programs such as the State of Illinois’ Preschool for All program and the Illinois Child Care Assistance Program (CCAP).

Though it provides significant jobs and revenue, this network of people, places and things is supported with sparse public funding.

Illinois is now facing a budget deficit of 13 billion dollars.  There has been ongoing, heated debate about whether or not to cut spending or increase revenue.  The governor has proposed legislation to address taxes, as have several lawmakers.  Governor Quinn’s bill calls for a 1% income tax increase, in addition to significant cuts to education.  Several advocacy interests have decried this bill as inadequate.  The favorite bill among early childhood advocates is House Bill 174, introduced by Senator James T. Meeks and Representative David Miller.  According to analysis by the Center for Tax and Budget Accountability, HB174

“effectively changes the Illinois tax structure in a number of ways. It would raise anywhere from $5.0 billion to $5.2 billion in new, recurring tax revenues, provide tax relief to homeowners and low income families, and provide additional funding for public schools, health and human services.”

Early childhood advocates most likely support this bill because of the mixed nature of early childhood funding.  This bill specifically addresses human services and education, which both support early childhood programs.

The Ounce of Prevention Fund Advocacy and Policy web pages describe cuts to early childhood education (click to see descriptions of effects on child care and early intervention funds):


Illinois is known as a national leader of the early childhood movement thanks to its early education system.  The Early Childhood Block Grant funds Preschool for All for three- and four-year-olds, as well as high-quality child development and family support programs for at-risk infants, toddlers and their parents.  However, several years of underfunding compounded by FY10’s cuts and delayed payments have led to children being turned away from programs their families have come to rely on; program closures across the state; and unmet preschool access goals for our state’s most at-risk children.

Summary of Governor’s Proposal:

The Governor’s proposed budget cuts state funding for education by $1.3 billion, a 17% reduction from FY10. This cut reflects the loss of funds provided by the federal stimulus program which will end this year (July 1, 2010).  Within this plan, the Early Childhood Block Grant is cut by $54 million, a 16% reduction that mirrors the total cuts to education.  The Governor’s address called for a 1% income tax surcharge for education which would make up the gap left by the stimulus funds, restore the education budget to current levels, and restore funds from the delayed payment cycle.  A powerful body of research clearly demonstrates the positive effects of early childhood development programs such as those provided by the Early Childhood Block Grant, both in the short- and long-term for the individuals who participate in them and society as a whole.  Without new revenue for education, the short-term savings earned by budget cuts will cost more in the long-run as we spend more to fix the problems we could have prevented in the first place.  Especially during difficult economic times, investing in our future – our children – is the smartest decision we can make.

The reason this is problematic and dangerous, as opposed to just being sad, is that people who are already struggling, and more vulnerable than most depend on these services as a safety net.  This net can catch people before they fall into hunger, homelessness and desperation.  Remove that net, and what do we have?  Do the benefits outweigh the risks?

Such cuts spell big losses for Illinois’ diverse early childhood programs.  This is a particular shame, because while it is far from perfect, our early care and education system has some great features: Support to improve home-based child care quality, including quality enhancement for license-exempt providers; Preschool for All and Prevention Initiatives – programs that provide services for children up until the age of 4, designed to improve school readiness, based on research and best practices; well-established and influential Early Learning Council, and a set of Early Learning Standards that actually correspond with developmentally appropriate practice, developed in cooperation with early childhood professionals.  Not to mention the firestorm of advocacy power and comprehensive programming found among Illinois Action for Children, Voices for Illinois Children and the Ounce of Prevention Fund – Illinois’ early childhood policy experts.  There is also the Erikson Institute, a renowned graduate school in child development that turns out graduates primed for leadership in the early childhood professions). These all depend on state funds to support their programs and their clients.  Every state can’t take such resources for granted, and for Illinois they are being chipped away and degraded by our own leaders.

What else does this budget shortfall mean for ECE funding in Illinois?  It means some grassroots planning is in order.  Though we were fortunate enough to get a boost from the stimulus dollars last year to save Illinois programs from doomsday, the feds are not likely to swoop in and save Illinois programs this time around: SAFRA, anyone?  Passed in July 2009, the Student Aid and Fiscal Responsibility Act (SAFRA) initiates student loan reform, and boosts financial aid (e.g. increasing the maximum Pell Grant scholarship amount).  As it was initially drafted, there were also significant set-asides for ongoing support to early childhood education.  But, as ECE author/consultant Karen Nemeth commented on Twitter after the historic vote on health care reform (tied to SAFRA through the reconciliation process), “Ah, Early Learning Challenge Grants, we hardly knew ye….”  From New America Foundation’s report by Jennifer Cohen on the latest incarnation of SAFRA:

“However, a couple programs are obviously missing from the most recent version of the House bill. Most notable is the Early Learning Challenge Fund, an $8 billion competitive grant program meant to improve quality of and access to early learning programs in states. The absence of this program in the bill could mean a blow to the Obama Administration’s early education agenda, which was largely touted during the campaign.”

I think we all knew not to hold our breath for too long on the Early Childhood Challenge grants, but it was still a disappointment. This is another example of the status quo where early childhood is delivered straight to the chopping block and we are made to watch while the politicians debate and the cleaver gets closer and closer and then strikes. It is another policy process that engages in the de facto de-prioritization of children and families in a national, cultural habit or shortsightedness.  There is still some hope that ARRA (the Stimulus) and the Elementary and Secondary Education Act (ESEA) will follow through on provisions that support early learning.  But early childhood advocates should have their legislators on speed dial, just in case.  Fiscal support for early childhood is usually hard won, and lobbying may be necessary to maintain funding commitments.

Another question worth asking: When and how do we stop accepting this as the status quo?  What would that look like?

Other reasons we need a better plan for supporting children and families in Illinois: whenever federal become available, they may need to be matched, i.e., our state will have to put up a percentage before we see the payoff, as is the case for the Early Childhood Advisory Council grants, which require a 70/30 state-to-federal dollar match.  We have to look ahead and ask whether we will have enough to avoid losing millions, and plan accordingly.

I hope Illinois can take lessons from last year, and avoid sustaining so many losses and so much waste.   Last spring, when Illinois state legislators could not present a budget plan that would protect children or families, service providers across Illinois made plans of their own.  Some provided services anyway, and ate the cost – an unsustainable practice.  Some rallied together, and got engaged with advocacy organizations like Illinois Action for Children and the Ounce of Prevention Fund, flooding the capitol and legislative offices with phone calls, faxes, and people.  Some enforced furloughs, creating cracks in the already strained ECE workforce.  Some closed their doors, leaving many dedicated practitioners and professionals to compete for jobs or leave their field in the midst of a national employment crisis.  None of these plans were ideal, and I fear that we will see more of the same, based on the tone of the political rhetoric, and the fact that there are elections coming up in November.  Here is Speaker of the House, Mike Madigan, discussing Governor Quinn’s tax proposal:

As a voter, a tax payer, a parent and a professional, I have little patience for public servants who put their own interests ahead of the well-being of the children, families and communities that they were elected to serve and represent.  I take no comfort in the fact that their checks are coming late as well.  It’s no secret that some legislative offices can’t pay their rent due to late payments.  It would be funny if it weren’t so grim.  Non-profits are accustomed to beleaguered state controllers, and late payments aren’t a big deal if you can be sure the money will eventually come.  Now it is possible that for many, many people working in programs that support communities across Illinois, the payments will stop coming.  Again.

Compounding the frustration: Even if the state finds that money will be there in the coming fiscal year, as with last year, people running these programs can’t take that possibility to the bank, and they won’t get any credit for it.  Meaning they’ll have to slash staff and services or close their doors before the game of Fiscal Chicken is even run out.  These are working, taxpaying people who would like nothing more than to avoid public assistance. It’s one thing to re-hire a few laid-off staffers once the money becomes available, but trying to re-open a closed business is another matter: An executive director cannot put space, equipment, staff and clients on the shelf until another grant comes through.  Those assets are likely gone once their gone, and the related losses are complex and far-reaching.

Initially, Governor Quinn instructed Illinois lawmakers to raise the state income tax by one-third, or cut billions in school funds.  Shortly afterward, Quinn back pedaled and went for a softer sell; a tax increase from 3% to 4%, to fund education. After last year’s debacle, Quinn appears reticent to present voters (or his colleagues) with anything but the tiniest squeak of a tax increase, directing the funds to something few would balk at much – education.  But that still leaves the state facing devastating cuts to human services and educational programs.  It is unclear how this will satisfy our state’s need for new revenue across the board, to cover the holes created by that 13 billion dollar deficit.  Progress Illinois reports (including reactions to the 1% proposal from some local ECE leaders):

Also, watch Governor Quinn talk about his tax increase plan:

We would do well to stop making this a cuts-versus-new-revenue discussion.  It does not occur to me how we can afford to focus on only one of these options: clearly we need to prioritize spending, but a starving person is not saved by telling them to eat less food. We should spend more carefully, but to suggest that early childhood programs, and social services are an expendable casualty of decadent spending habits is disingenuous and irresponsible, especially in the face of evidence like this from Nobel laureate, University of Chicago Professor James Heckman.  We should spend more on early childhood, not less.

We need new revenue to secure needed systems and safety nets already in place, for the safety and wellness of Illinois citizens.  No belt-tightening will solve 13 billion unavailable dollars.  We need bigger pants.  Starving our state to a smaller size is not a good idea.  That sounds like the Colorado Springs option, which is not a smart one.  Let’s not cut off our nose to spite our face.  The people of Illinois deserve better.  Our children, families and communities need more.


3 Responses to "IL Budget Crisis and Early Childhood Funding: An Overview"

[…] Go here to see the original: IL Budget Crisis and Early Childhood Funding: An Overview « And … […]

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This post was mentioned on Twitter by DannerMcP_ECE: New on my blog… IL Budget Crisis and Early Childhood Funding: An Overview – | Comments welcome! #IL #ece #budget…

“We need bigger pants.” = best metaphor ever?

I don’t see “cut spending/increase revenue” as an either/or situation. I totally agree that we need to do both.

Thanks for posting the James Heckman link, I never thought of early childhood education from an economics perspective. I have to check out more of his work.

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