‘Heat and eat’ — another squandered opportunity

Michigan is being penny-wise and pound-foolish, refusing to pay $3 million to bring in $137 million in federal food assistance to 150,000 low-income households.

There are two issues in play here. The first is is that the Supplemental Nutrition Assistance Program (formerly food stamps) does not keep up with family food costs. The second is that Michigan has been able to raise SNAP benefits by an average of $76 per household, but now refuses to do so. (more…)

Oh Michigan!

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‘O’ stands for October — and it also stands for Opportunity.

With just a few short weeks before the Nov. 4 election, now is your best chance as a concerned Michigan citizen to make a difference. (more…)

Failure to Invest in High-Quality Child Care Hurts Children and State’s Economy

Child care is a necessity for working parents and a key ingredient in the state’s recipe for economic growth. Access to safe, stable and high-quality child care reduces employee absenteeism and turnover and improves businesses’ bottom line. And, because learning begins at birth, it is in child care that many children are developing the basic language, cognitive and emotional skills needed to succeed in school and beyond.

For low-wage workers, child care has become increasingly unaffordable, often rivaling or exceeding housing costs. The state’s child care subsidy program has not adequately met the need, and since 2005, the number of low-income Michigan parents receiving publicly subsidized care has dropped by two-thirds, from nearly 65,000 to only 22,000. Total child care spending fell from $479 million in 2005 to just $136 million in 2014—a reduction of over 70%.

While changes in the economy, including high unemployment, undoubtedly had some impact, policy decisions—including Michigan’s continuing low child care subsidy eligibility levels and provider payments—have been major contributors to Michigan’s inadequate child care system.

Very Young Children Are Most At Risk

The underfunding of Michigan’s child care system is particularly troubling because of the high numbers of very young, low-income children in care while their parents work. In June 2014, 40% of all the children in state-subsidized child care were under the age of 4, and over 60% were under age 6.1

Michigan has too few licensing inspectors to ensure that even basic health and safety standards are met. Placing very young children in care of unknown or questionable safety and quality is a risk Michigan can’t afford to take given the scientifically documented importance of the first years of life in terms of lifelong learning and development. It is during the earliest years that the very architecture of the brain is constructed—a window of opportunity to prime children for success in school and life.

Communities Have Lost State Funding That is Needed to Keep Families Working

The reduction in state child care payments to local communities has economic repercussions. Parents find it increasingly difficult to secure reliable, consistent child care, making it more difficult for them to keep their jobs and provide for their children. Child care providers—an important sector of the state’s workforce—continue to struggle to bridge the gap between their costs and what parents can afford to pay. And, children who spend large portions of their first 2,000 days of life in low-quality child care can face greater hurdles as they transition to school and ultimately into the workforce.

The impact of reduced spending is felt acutely in Michigan’s most populous counties, where more than two-thirds (67%) of the children in state-subsidized child care reside. For example, between January 2007 and January 2014, the average monthly number of children in state-subsidized child care fell nearly 76% in Wayne County, from 38,910 to 9,408, while state funding fell from $16.4 million to $2.5 million. In Kent County, the number of children fell 69%, from 7,314 to 2,283, while payments fell from approximately $3 million to $567,000.

While the impact of child care subsidy caseload reductions and funding losses affects counties and regions of the state somewhat differently, all counties have experienced steep declines. For example, in Southeast Michigan, the decline in average monthly child care spending between January 2007 and January 2014 ranged from 63% in Livingston County to 84% in Wayne.

An Overview of Michigan’s Child Development and Care Program

Michigan’s Child Development and Care program provides child care subsidies to: (1) public assistance recipients; (2) low-income working families with incomes below 121% of poverty ($22,448 for a family of three); (3) licensed foster parents caring for foster children; and (4) families with open child protective services or preventive services cases.2 Most children eligible for subsidized care (65%) in fall 2013 lived in low-income working families; roughly another quarter (23%) lived in families receiving public assistance while working or participating in another approved activity.

Child care subsidies are available for eligible children under the age of 13, as well as children between the ages of 13 and 18 in cases where there are health or disability reasons or a court order. According to state policy, there are four valid reasons for care: (1) family preservation; (2) high school completion; (3) participation in an activity approved by the state; and (4) employment.

Between 2012 and July 2014, Michigan covered only 80 hours of child care in a two-week period—down from a high of 140 hours. The Legislature approved the governor’s recommendation to increase reimbursable care to 90 hours biweekly beginning July 27, 2014. Thirty-two states do not impose caps on the hours of care, and of the states that do, Michigan’s is the lowest, with the average cap being 120 hours biweekly.3

Under federal law, parents are allowed to choose the type of child care settings that best meet their family’s needs, with the following options in Michigan:

  • Child care centers – Facilities, other than private homes, licensed to care for groups of children.
  • Group child care homes – Private homes, licensed to care for up to twelve children.
  • Family child care homes – Private homes registered to care for up to six children.
  • Unlicensed child care providers – Care provided by relatives either in the provider’s or child’s home; or care provided by an unrelated adult in the child’s own home.

In 2011, Michigan’s child care subsidy program was transferred to the new Office of Great Start in the Michigan Department of Education, where the goal is to make child care a part of the early learning continuum—rather than solely a work support resulting in children spending long days in child care settings of unknown quality while their parents work at low-wage jobs. While the Child Development and Care program is housed in the Michigan Department of Education, eligibility is currently determined by local Department of Human Services workers.

In 2012, Michigan spent $23 million on child care quality improvements, or nearly 15% of total federal Child Care Development funds—above the 4% required by federal law.4 Michigan spends those funds on its child care quality improvement and rating system (Great Start to Quality); child care licensing; local Great Start to Quality Resource Centers; tuition scholarships and supports for early childhood educators; the Great Start CONNECT database that helps parents secure better quality care, and serves as a resource for providers; and local Great Start Collaboratives and Great Start Parent Coalitions.

A Note on Michigan’s Other Major Early Learning Programs

Great Start Readiness Program: While Michigan’s child care system is underfunded, the state has made great strides in early education for at-risk 4-year-olds through a $130 million expansion in the Great Start Readiness Program over a two-year period, bringing total funding to $239 million. Michigan’s rise in state funding for preschool was the largest dollar and service expansion in the country, and helped to draw down another $52 million in federal Race to the Top – Early Learning Challenge funding to focus on quality improvements. Michigan expects to serve a total of 63,000 children in the GSRP during this upcoming school year, up from approximately 32,000 in the 2012-2013 school year—nearly doubling the number of children who benefit.5

Currently, 90% of each GSRP grantee’s enrollment of 4year-olds must live in families with annual income at or below 250% of poverty ($46,380 for family of three). Beginning Oct. 1, 2014, children from families with incomes of up to 300% of poverty ($55,656 for family of three) can be enrolled if Intermediate School Districts can demonstrate that all children at or below 250% of poverty are being served and there is no waiting list. The highest need children must be enrolled first; and homeless children, children in foster care and those in special education inclusive preschool programs are eligible regardless of family income.

GSRP is a half-day program for approximately 50% of the children who participate. Providers can combine funding for two GSRP “slots” to create a school-day program, and more have done so with the recently expanded funding. Michigan has not elected, as many states have, to open its state preschool program to 3-year-olds. This is a critical gap, since research shows that two years of intensive preschool provides the best results, particularly for low-income children.

Despite the large increase in overall funding for preschool for 4-year-olds, there have been only small increases in per-slot funding for the GSRP in recent years. The Legislature rejected the governor’s recommended increase of $100 per slot for the 2014-15 school year, leaving total per slot grants at $3,625. Low payments make it difficult to ensure the uniform level of quality needed across the state, as well as build more high-quality programs in the private, community-based sector. In the upcoming school year, Intermediate Schools Districts may lose preschool slots if they fail to submit evidence that they attempted to contract 30% of their total slots to community-based organizations.

Head Start and Early Head Start: In 2013, Michigan received $266 million in federal Head Start funding.6 Federal funds are provided directly to local Head Start providers, and are not subject to state appropriations. Michigan does not invest significant state funds in Head Start. Supplemental state spending on Early Head Start and Head Start is limited to less than $700,000, and includes federal Maternal, Infant and Early Childhood Home Visiting program funds used to expand Early Head Start in three Michigan counties.7

In 2013, there 43,921 Michigan children enrolled in Head Start programs, including 37,571 in regular Head Start (86%), 6,259 (14%) in Early Head Start, and 91 in migrant/seasonal Head Start. Of the funded options for regular Head Start, 89% were in center-based programs, 9% in home-based programs, and 2% in combination programs. For younger children and pregnant women (Early Head Start), 75% were in home-based programs.8

Michigan’s Child Care System is Failing Many Low-Income Working Families

High-Quality Child Care is Unaffordable for Many Families. Child care is one of the biggest items in many working families’ budgets. The average annual cost of full-time infant care in a child care center in Michigan is over $10,000, which is nearly half of the state median income for a single mother, and 13% of the median income of a married couple, placing Michigan as the 12th least affordable state in the U.S. for infant care. Full-time centerbased care for a 4-year-old in Michigan is nearly $8,000, with care for school-age children averaging over $4,500.9

Single parents hoping to place their children in high-quality child care centers—where costs are likely higher than the average—would owe more in child care than rent, with average annual rent payments in the state at nearly $9,000. Certainly they would not be able to afford to buy a home, with average mortgage payments of over $16,000 annually.10

Low Eligibility Levels and Provider Payments Have Limited Access and Quality of Care.

Michigan’s child care eligibility levels are among the lowest in the country. Michigan has one of the lowest child care subsidy eligibility levels in the country, limiting low-income parents’ access to the child care assistance they need to work and support their children. The state’s child care income eligibility threshold (39% of state median income) has not been changed since 2003, and without adjustments for inflation has fallen from 155% of poverty to 121%, or gross monthly income of under $1,990.11

Low child care provider payments have forced families to seek out unlicensed care of unknown quality. Michigan’s low subsidy rates have limited access to licensed or higher quality child care. Historically, child care provider rates have varied depending on the type of child care setting (centers, family and group homes, relatives and aides), the age of the child (under or over 2½ years of age), and the region of the state where care was provided.

In 2010, child care provider rates were restructured and are now the same statewide, varying only by the age of the child and the type of child care setting. Michigan continues to reimburse child care providers on an hourly basis, depending on a child’s actual attendance, making it difficult for providers to run their businesses and project income. Most states pay child care providers on a daily, weekly or monthly basis.

In 2012, Michigan’s reimbursement rates for state subsidized child care were well below the federally recommended level—the 75th percentile of current market rates, which is the level designed to give families access to 75 percent of local providers.12 The state subsidy for a 4-year-old in center care was $433 per month, less than half the $974 monthly subsidy that would represent the 75th percentile of market rate in that year. Center care for a 1-year-old was $650 per month, which is 35% below the 75th percentile of market rate.13

In July of 2014, Michigan increased rates for higher quality providers, based on the state’s new child care quality rating system that ranks licensed child care centers and homes based on a star system, with five stars representing the highest quality programs.

While this rate adjustment is long overdue and much needed, state rates still do not reflect the true and growing cost of care, and under state policy, low-income families are required to pay the difference between what the state will pay for child care and providers’ actual rates. More importantly, there are still relatively few providers in the state eligible for higher payments as a result of quality improvements.

Michigan launched its child care rating system, known as Great Start to Quality, in 2011, but there is still much work to be done to increase the number of child care centers and homes that have high ratings and are thus eligible for higher payment rates. As of Aug. 1, 2014, of the 9,963 programs/providers eligible to participate in Great Start to Quality statewide, 8,164 (82%) had met only basic licensing requirements.

 

Inadequate state child care rates have forced many low-income families to seek out lower cost unlicensed care of unknown or poor quality. In response, state policymakers—using both a carrot and stick approach—have sought to encourage greater parental reliance on licensed care, as well as improve the quality of unlicensed care. Payment rates for unlicensed child care providers were reduced as part of state budget cuts, but also as a reflection of the intention to focus state subsidy dollars on licensed care. Then, beginning in 2009, all unlicensed home providers were required to participate in a seven-hour orientation training before being able to receive a subsidy. When the training requirement was adopted, 65% of subsidized children were in the care of unlicensed providers; by 2012, only 38% were placed in unlicensed care.14

Unfortunately, there are no data showing whether the parents of children no longer in unsubsidized care were able to find higher quality child care in licensed homes or centers, and it is possible that grandparents or other relatives caring for young children simply dropped out of the subsidy system because they were unable to participate in the training, or chose not to because they anticipated only caring for children for a short period of time to help out a family member.

Between 2009 and 2012, overall licensed child care capacity in Michigan fell by nearly 5%, from 366,000 to 349,000. Child care center capacity remained flat, while the capacity of family and group child care homes fell by over 22%.

Michigan Has Been Unable to Adequately Supervise Licensed Care to Ensure Children’s Basic Health and Safety

One area of consistent underfunding has been child care licensing. Michigan has a history of insufficient child care licensing inspectors to monitor child care providers’ compliance with baseline health and safety guidelines. In May 2014, the state employed 68 child care licensing inspectors who were responsible for 10,397 child care facilities, resulting in a 1:153 caseload ratio—more than three times the recommended ration of 1:50.15

As a result, a recent unannounced site visit and audit of 20 licensed family and group child care homes that received CCDF funding in Michigan found that all 20 providers did not comply with one or more state licensing requirements related to health and safety of children, and half did not do required criminal record and protective services checks.16

Subsequent site visits to three child care centers found that the state failed to ensure compliance with health and safety requirements, with all three not completing required criminal record or protective services checks on employees. Included in the audit findings were a blocked fire exit, hazardous substances within the reach of children, a recalled safety crib, unsupervised toddlers, and one caregiver for eleven children in a mixed group including 3-year-olds—all violations of state licensing rules.

One of the primary recommendations of the federal auditors was that Michigan must ensure adequate oversight of child care homes by reducing licensing inspectors’ caseloads, something the state responded was unlikely given current budget constraints.

Investments in Child Care Boost the Economy and Create the Next Generation of Workers

While access to affordable child care has become more limited in Michigan, the state has begun to address the quality of child care, and those efforts were recently bolstered with the new federal Race to the Top – Early Learning Challenge grant. Current initiatives to improve quality are critical, but face an uphill battle because the child care system is so grossly underfunded that it is difficult to attract and retain skilled providers, and high-quality care is financially out of the reach of so many working families.

To ensure that children have the right start in life, and to give lower wage workers the opportunity to work and support their families, Michigan must increase its investments in child care—particularly for its youngest children. While significant investments are needed throughout the child care system, the following is an initial agenda for the state:

  • Increase child care payment rates with the goal of reaching the 75th percentile of market rate. Michigan’s efforts to improve child care quality and get Michigan working will be inhibited if parents cannot afford safe, reliable and high-quality child care, and it is impossible to develop and retain a qualified child care workforce.
  • Increase funding for child care licensing consultants, with the goal of a 1:50 ratio, to ensure that children’s basic health and safety are protected when in state subsidized child care. Failing to invest in the basic safety and health of children who are in child care so their parents can work to support them is incomprehensible and unacceptable.
  • Provide child care payments on a daily or weekly basis, rather than hourly. To ensure an adequate supply of stable child care, it is important to streamline the system and ensure that providers can project their income and stay in business.
  • Further increase the hours of care so that child care can be reimbursed while low-income parents work or participate in approved education and training. While the increase in the upcoming year from 80 hours of reimbursable child care every two weeks to 90 is welcome, it is still too low. If a cap is continued, it should not fall below 100 hours biweekly because it is a disincentive for lowincome parents trying to juggle child care with full-time jobs or training activities, and doesn’t recognize both a 40-hour work week and the time required to travel to a child care setting and work, particularly for parents who are working multiple jobs to make ends meet.
  • Expand eligibility for the Great Start Readiness Program to provide a high-quality early learning experience for the state’s low-income 3-year-olds, beginning on a pilot basis. There is evidence that the lowest income children with the most risk factors do best when they have two years of early childhood education that is adapted to their developmental levels. Of the 40 states that have state-funded preschool programs, only 14, including Michigan, do not enroll 3-year-olds.
  • Strengthen Michigan’s tax system to support the work efforts of families earning lower wages and increase the quality of child care. In 2011, Michigan increased taxes on working families as a way to fund reductions in business taxes. Included was a 70% cut in the Michigan Earned Income Tax Credit which reduced the tax credit for a single mom raising two children and working full-time at minimum wage ($7.40/hour) from $1,074 to only $322—funds that could be used to purchase higher quality child care or transportation to and from work. The EITC is a proven tool for supporting working families, and has been shown to have longlasting positive effects on children, including success in school.

Michigan should also adopt child care tax credits that could help increase access to care and improve quality. One model is the Louisiana School Readiness Tax Credit, which was adopted in 2007, and provides refundable tax credits to: (1) low-income parents who purchase higher quality care for their children while they work to support their families; (2) child care providers based on their level of quality and the number of state-subsidized children they serve; (3) child care teachers and directors in programs that participate in the state’s child care rating system; and (4) businesses that invest in high quality child care.

Endnotes

1. Green Book Report of Key Program Statistics, Michigan Department of Human Services (June 2014).
2. Child Development and Care, presentation to the House Appropriations Subcommittee on Education by Lisa Brewer-Walraven, Michigan Department of Education (March 5, 2013).
3. Ibid.
4. Michigan Race to the Top – Early Learning Challenge Application for Initial Funding, Michigan Department of Education Office of Great Start (Oct. 11, 2013).
5. History of GSRP Funding, Michigan Department of Education at http://www.michigan.gov/documents/mde/Funding_History_317203_7.pdf?20140818143632
6. Michigan Race to the Top – Early Learning Challenge Application for Initial Funding, op. cit.
7. Ibid.
8. Center for Law and Social Policy DataFinder.
9. Parents and the High Cost of Child Care, 2013 Report, Child Care Aware of America (2013).
10. Ibid.
11. Communication from Lisa Brewer-Walraven, Director, Child Development and Care, Office of Great Start, Michigan Department of Education (March 14, 2013).
12. State Child Care Assistance Policies: Michigan, National Women’s Law Center (October 2012).
13. Karen Schulman and Helen Blank, Downward Slide: State Child Care Assistance Policies 2012, National Women’s Law Center.
14. Michigan Race to the Top – Early Learning Challenge Application for Initial Funding, op. cit.
15. Letter from Michael P. Flanagan, State Superintendent, Michigan Department of Education, and Maura D. Corrigan, Director, Michigan Department of Human Services to Sheri L. Fulcher, Regional Inspector General for Audit Services, Office of Inspector General, Office of Audit Services, Region V (May 28, 2014).
16. G. L. Jarmon, Some Michigan Child Care Home Providers Did Not Always Comply With State Health and Safety Licensing Requirements, Office of the Inspector General, Department of Health and Human Services (July 2014).

Census numbers tell of stagnancy and slow recovery

Today is the big day that comes each year: the release of American Community Survey figures on income and poverty.

Ready for some numbers?

Michigan’s household median income in 2013 ($48,273) was a bit higher than in 2012, but is nearly $1,000 lower than in 2009. The income bracket that grew the largest from 2009 to 2013 was the share of Michigan households who make under $10,000 a year. The only other income bracket with a significant share increase was households making more than $200,000 a year. These numbers taken together suggest that the slow economic recovery in Michigan is primarily benefiting those at higher incomes. (more…)

Back to school: Are children ready to learn?

For children to succeed in school, they must go to school “ready to learn” –  rested, fed and healthy. But how many children will start the school year with a toothache or other dental problem?

According to the Department of Community Health’s 2011 -2012 Count Your Smiles survey, the number is likely pretty high. (more…)

100,000 kids get reason to smile, 400,000 left out

With the expansion of Healthy Kids Dental to Kalamazoo and Macomb counties, 100,000 kids (and their parents) will have reason to smile as they gain access to this highly successful program starting Oct. 1.

Healthy Kids Dental  is a public-private partnership between the Department of Community Health and Delta Dental of Michigan. The program is available to Medicaid-eligible children under age 21 in 78 counties in which the Department is funded to contract with Delta Dental. (more…)

Maternal and infant risks in Michigan’s legacy cities

Roughly one of every four children in the state lives in one of Michigan’s legacy cities located across the southern half of the state’s Lower Peninsula. These legacy cities, once economic and social powerhouses, are now, in many cases, struggling with population loss and high unemployment.

Perhaps, not so surprising, risks to maternal and infant well-being are generally worse within these cities than the out-county areas in the counties where they are located.

The latest analysis of Right Start in Michigan, an annual report from Kids Count in Michigan, examines eight indicators to assess maternal and infant risks across the 15 so-called legacy cities. Only Ann Arbor, which has actually thrived in the new post-industrial economy, shows lower risk on almost all indicators than the out-county. (more…)

Today’s lesson: Poverty is not a learning disability

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My Brother’s Keeper is a White House initiative aimed at addressing what is truly a crisis in Michigan and across the nation: The lack of opportunity for young males of color.

Attendees at the Opportunity and Equity Convening Monday in Novi, an event sponsored by the Prosperity Coalition and the League, heard directly from Cabinet Secretary Broderick Johnson, who attended the gathering to preview the initiative – with a report due to President Obama May 28. (more…)

More schools can opt to feed all their hungry kids

At school, a fifth-grader named Rosie pretends her teacher is a banana, and her classmates are apples. Active imagination? Yes, but not only because she’s a child. Rosie cannot concentrate on her school work because her stomach is empty. She’s constantly hungry and copes with it by daydreaming about food.

That is the unfortunate experience of a food-insecure child documented in A Place at the Table, a film that highlights some of the effects of hunger on children. (more…)

Early reading critical

Michigan is losing ground on a key benchmark in its long-term goal of expanding its educated workforce. The state is among only six that showed no improvement in reading proficiency among fourth-graders over the decade between 2003 and 2013, according to a just released Data Snapshot from the Annie E. Casey Foundation.

Almost seven of every 10 Michigan fourth-graders did not demonstrate reading proficiency in 2013—up 1 percentage point from 2003 while the national average dropped by 4 percentage points, according to the review of national test results across the states. Just over half (53%) of all fourth-graders in the best state, Massachusetts, scored below proficient in reading compared with almost four of five Mississippi fourth-graders. (more…)

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