The changing landscape of publicly-funded center-based child care: 1990 and 2012

https://doi.org/10.1016/j.childyouth.2018.05.029Get rights and content

Highlights

  • The supply of publicly-funded centers has expanded greatly since passage of the Child Care and Development Block Grant of 1990.

  • Growth between 1990 and 2012 within the for-profit sector has been due exclusively to centers receiving public funds.

  • There has been dramatic growth in reliance on vouchers as a core funding mechanism among publicly-funded child care centers.

Abstract

Low-income families' ability to sustain employment while ensuring the care and safety of their young children is profoundly affected by federal policies regarding access to subsidies and programs, such as Head Start. The current structure of these policies evolved during the decades following the 1990 enactment of the Child Care and Development Block Grant – a period that also witnessed expansion of the Head Start program and growth of state pre-K programs. Using data from two nationally representative surveys of child care providers conducted in 1990 and 2012, this paper examines trends in the supply, sponsorship, and funding structure of publicly-funded child care centers during this period of active policymaking in early care and education. These changes include major expansion in the number and share of child care centers receiving public funds, as well as in the number of children enrolled in these centers; relatively more rapid growth among for-profit vs. non-profit centers in the publicly-funded sector, but consistency in that the major share of publicly-funded centers remained non-profit; and substantial growth in publicly-funded centers receiving vouchers as a primary funding mechanism. These trends carry the potential to enhance the reach of quality improvement efforts tagged to public funds and may have increased low-income families' choice of centers with differing hours, in a range of locations, that serve a wider age range of children, as well as children supported with differing funding sources. Whether the growing supply of publicly-funded centers has actually kept pace with demand, let alone enhanced access of low-income families to care that supports their children's development, are critical, next-stage questions to address.

Introduction

Low income children and families are profoundly affected by federal and state policies that determine the availability and structure of public child care support. Access to publicly-funded child care affects parents' ability to sustain employment, the type and quality of child care to which they have access, and the income available to the household for non-child care expenses. Child care policies, for example, set family eligibility criteria, establish reimbursement rates, and determine which providers are eligible to receive funds. Between 1990, when the major federal child care subsidy law was enacted – the Child Care and Development Block Grant (CCDBG) – and today, these policies have been revisited numerous times (Cohen, 2001).

During the same period, the landscape of public child care options for low-income families experienced a number of significant changes. For example, the Head Start program for low-income preschool-age children experienced close to a doubling of enrollments (U.S. DHHS, 2017) and, in 1995, the Early Head Start Program was established to serve poor children birth through age two and pregnant women. The number of state-funded pre-kindergarten programs has increased substantially and enrollments, now at 1.5 million children, have doubled since 2003 (Barnett et al., 2017; Barnett, Robin, Hustedt, & Schulman, 2003; Chaudry & Datta, 2017).

This constellation of early education policy developments likely influenced the supply and characteristics of publicly-funded child care centers and thus low-income families' access to child care that addresses their dual needs for employment support and support for their children's development. Nationally representative surveys of child care providers and households with young children, conducted in 1990 and 2012, provide the opportunity to examine how the supply and funding structure of publicly-funded child care centers have changed during this period of active policymaking in early care and education. This paper takes advantage of this opportunity to ask: How have the supply, auspice and sponsorship status, and funding structure of child care arrangements receiving public funds changed over this 22-year period?

Specifically, we examine changes in the supply, types (defined by auspice and sponsorship), and funding sources and mechanisms of publicly-funded child care centers. These centers, as defined below, encompass those receiving any federal, state, and/or local funds or sponsored by a government agency, including public schools. We compare the changes affecting publicly-funded centers with those that have characterized centers not receiving public funds over the same time period. This comparison offers insights into the extent to which goals articulated in the 1990 CCDBG legislation to maximize low-income families' choice and access to care have been addressed. We next trace trends in federal subsidy (CCDBG) policy since 2000 and then turn to a summary of other developments in the public child care landscape, followed by a description of the current study.

The modern-day structure of federal child care subsidy policy was put in place during the two decades following enactment of the CCDBG (Cohen, 2001; Lombardi, 2003). The CCDBG established for the first time a stand-alone federal child care subsidy program for low-income families. Its explicit priority was to facilitate work and thus offer families maximum flexibility and choice in making child care arrangements. Accordingly, a central goal of the law was to ensure that families dependent on public support for child care would have access to similar child care options as those who purchased child care privately (Adams & Rohacek, 2002; Cohen, 2001). Driven by these emphases on choice and equity of access, the law and the regulations that accompanied the law mandated reliance on vouchers (in addition to contracts and grants) and allowed federal dollars to purchase child care provided by religious institutions and settings that were exempt from state child care regulation, such as informal, home-based arrangements and care by relatives. States were given wide discretion in establishing payment rates, as long as they were based on market surveys, and in the extent to which health and safety requirements were applied to funded programs.

Federal child care subsidy policies have continued to evolve post-1990. Most notably, the 1996 welfare reform legislation (the Personal Responsibility and Work Opportunity Reconciliation Act, P.L. 104-193), consolidated the CCDBG with three child care programs funded as part of the U.S. income support program - Aid to Families with Dependent Children (AFDC). The new streamlined law (commonly referred to as the Child Care and Development Fund or CCDF) thus integrated child care support for families on welfare (AFDC) and for low-income working families. The law removed the prior entitlement to free child care for families on AFDC, expanded eligibility to families with incomes up to 85% of state median income, and substantially increased child care funding (Lynch, 2014). The CCDBG received additional, though smaller, funding increases in the late 1990’s and early 2000’s, spurred by evidence that large numbers of eligible children were not receiving services. The net result of these policy changes was a substantial increase in child care subsidy funding from a combined total of $1.27 billion in 1991 ($732 million for the CCDBG and $537 million for the three pre-1996 welfare-linked child care programs) (Lynch, personal communication, April 9, 2018) to combined (CCDF) funding in 1996 of $2.9 billion, and growing to $5.2 billion in 2012. As of 2012, an average 1.5 million low-income children received CCDF subsidies each month (Lynch, 2014).

Implementation of federal subsidy policy occurs within the context of other policies and programs in each state and at the national level that have evolved alongside the CCDBG. Since 1990, the Head Start program has experienced major expansions, including enactment in 1995 of the Early Head Start program serving infants and toddlers. Federal funds for Head Start grew from $1.55 billion in 1990 to $3.6 billion 1996 and to almost $8 billion in 2012, with enrollments at close to 1 million children (U.S. DHHS, Head Start Bureau, 2017). In addition, the number of states with pre-kindergarten (pre-k) programs has grown from 13 in 1990 to 40 as of 2012, adding a significant new player to the child care landscape (Chaudry & Datta, 2017). State expenditures on pre-k programs grew from $2.4 billion in 2001–20021 to $5.1 billion in 2011–2012. The majority of these programs (33/57) target low-income children and thus provide an important new child care option for low-income preschoolers. At the federal level, the late 1990's saw increasing attention to campus-based child care and school-age child care starting in the late 1990's, funded through the Higher Education Act and the 21st Century Community Learning Centers legislation. The aggregate impact of these developments is that the early care and education options available to low-income families have expanded substantially since 1990.

The availability of two nationally representative surveys of child care programs in the U.S. – the Profile of Child Care Settings: Early Education and Care in 1990 and the National Survey of Early Care and Education conducted in 2012– offer the opportunity to examine trends in the broader context within which programs receiving public funds have sought to meet the needs of low-income families. Importantly, the two surveys capture the time frame during which the CCDBG has become a mainstay of federal child care policy. We address gaps in knowledge regarding how the center-based child care options available to families with preschoolers, defined as children three to five years of age, have changed since enactment of the CCDBG. This age restriction was necessitated by the structure of the Profile of Child Care Settings Study, for which some questions were restricted to preschool-age (3–5 year old) classrooms. We compare centers receiving at least some public funds to those not receiving any public funds, and explore how the characteristics of these two subsets of centers have changed over this period of substantial evolution in the nation's subsidy policies and surrounding context.

Central questions that we address, based on the priorities guiding federal and state child care policies between 1990 and 2012, concern (1) growth in the supply of child care, (2) changes in the characteristics of this supply, especially with regard to for profit status and sponsorship, and (3) changes in the funding structure of child care programs, notably in the role of vouchers and the extent of reliance on single vs. multiple sources of funding. Growth in the supply of publicly-funded child care options, a more diverse array of programs, and greater reliance on vouchers and multiple funding sources would presumably indicate enhanced options for parents eligible for public child care support. If similar trends regarding the supply, diversity, and funding structure of centers are documented for non-publicly-funded programs, this would affirm the policy emphasis on equity of access to child care for families regardless of their reliance on public funds to support child care costs.

We focus on child care centers for three reasons. The majority of CCDBG funds pay for center-based child care (72%) and for care for children ages birth to five years (66%) (U.S. DHHS, 2015). The majority of children (73%) in CCDBG-funded care as of 2015 were in centers (Mohan, 2017). Second, we examine Head Start and pre-K funds in some of our analyses. Because the vast majority of these funds also go to center-based arrangements, we chose to restrict our sample to child care centers. Finally, the list of home-based arrangements from which the sample for the 1990 survey was drawn was less complete than the list of center-based providers (Kisker et al., 1991a, Kisker et al., 1991b), leading to concerns about the representativeness of this subgroup of child care programs and comparability with the 2012 data. Nevertheless, it is important to place center-based care in the context of the larger child care market. In 1990, the centers examined in this study comprised 38% of all providers in the PCS and 86% of enrollments. In 2012, these centers comprised 52% of the same types of providers in the NSECE (center-based providers and home-based providers appearing on state or national lists) and 90% of their enrollments.

In sum, we focus on centers receiving and not receiving public funds, and serving 3–5 year olds, in 1990 and 2012 to address three questions:

  • (1)

    How has the supply of center-based child care, with regard to both programs and enrollments, changed over the 22-year period from 1990 to 2012?

  • (2)

    How have the types (defined by auspice and sponsorship) of child care centers changed over this period?

  • (3)

    How have the sources (e.g., contracts, vouchers) and funding structure of revenues that support publicly-funded child care centers changed from 1990 to 2012?

Section snippets

Data sources

This study relies on secondary data analyses of two nationally representative surveys of child care programs in the U.S. conducted in 1990 and 2012: The Profile of Child Care Settings (PCS) conducted in 1990 (Kisker et al., 1991a) and the Center-based Provider Survey from the National Survey of Early Care and Education (NSECE) conducted in 2012 (2014; National Survey of Early Care and Education Team, 2013). The NSECE was designed, to the extent possible, to provide an update of the PCS. The

Trends in the supply of child care centers

During the period from 1990 to 2012, the supply of centers serving at least one 3–5 year- old child grew substantially. The number of such centers grew by 67% between 1990 and 2012, from 71,690 to 120,046 centers (see Table 1).

All of this growth occurred among centers receiving public funding. The number of centers serving preschool children that received public funds increased by 134%, twice the growth rate of centers overall. As a result, the proportion of all centers receiving some public

Discussion

The central purpose of this paper was to examine trends in publicly-funded child care centers since passage of the CCDBG and to compare these trends to those characterizing centers not receiving public funds. This focus was driven by the emphasis in the CCCBG on supporting work among low-income families and expanding these families' access to the range of center-based (and other) child care options available to non-subsidized families. Three central findings emerged from this analysis, each of

Limitations

As is often the case with reliance on secondary data sources, let alone two sources that span over two decades, our findings raise at least as many questions as they answer. We are unable to assess, for example, the impact of the documented trends in program auspices or funding sources and mechanisms on actual center operations, fiscal stability, or enrollments, let alone on the quality of care provided in publicly-funded child care centers. These are each critically important topics for

Conclusion

The surveys do, however, capture two nationally representative portraits of center-based child care over a two-decade period during which policy actions were taken to address needs for expanded child care options for low-income working families. The trends we were able to document indicate that, at a broad national level, the number and perhaps variety of centers that accept public child care funds has greatly expanded. The growth in supply, as well as expanded reliance on vouchers, may have

Acknowledgements and funding

The authors thank members of the Child Care and Early Education Policy Research Consortium for their helpful comments in earlier drafts of this manuscript. This work was supported by the Office of Planning, Research and Evaluation (Administration for Children and Families) grant #90YE0165 titled, The changing landscape of publicly-funded center-based child care: 1990 and 2012.

Conflicts of interest

None.

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