Spending Disparities: A Patchwork Approach To Pre-K Funding (Interview)

Kent McGuireKent McGuire, president and CEO of the Southern Education Foundation based in Atlanta, Georgia

What’s going on with Pre-K in the South; what are some of the trends you see?

I think a consistent trend – over as many as seven to ten years – is that the demand for early childhood education, for pre-K, has increased steadily right across the South. That shouldn’t surprise us insofar as the birth rates in this part of the country are high relative to other parts of the country – the fastest-growing demographically, and there’s been some considerable in-migration to account for some of that as well.

Either way, what the data show are that demand for, and service levels, have increased fairly steadily relative to other parts of the country; our report from a couple of years ago suggests that the percentage of kids in public programs is twice the national average. If the national average is somewhere between 10 and 14 percent, the national average in the South is between 20 and 25 percent; that’s been a fairly consistent trend. Now the kind of fiscal challenges here of late, certainly since 2008-2009, have probably put a dampening effect on the number of kids served relative to demand or eligibility, but it doesn’t change the overall pattern that we see in this part of the country.

So, basically what you’re saying is that demand has increased, but because of fiscal challenges, states have not been able to keep up with the demand?

I think that varies from state to state, but as with everything else in this period of time, the recession, which maybe it started in 2009 but it is still playing out in terms of state budgets; I think states have struggled just to hold those kind of pre-recession budget commitments, and in any number of instances we’ve seen reductions, modest or worse. Here in Georgia, for instance, where lottery funds support pre-K, we’ve had to reduce the number of days in the year; we’ve had to debate whether or not we should reduce service from a full day to a half day. Luckily we didn’t do that, but it’s indicative of the challenges that I think all the states are facing as they figure out how to meet this growing demand with limited resources.

Can Pre-K programs survive cuts from state legislatures? Are states down to the bare bones now?

Well, it probably depends on who you talk to. You know, about two months ago [the Southern Education Foundation] held a meeting here in Atlanta where we had teams of people from six states in the South: South Carolina, Georgia, Alabama, Mississippi, Arkansas and Louisiana, and we talked about the fiscal challenges and what the states were doing to try to work through and around those challenges, among other things. These are creative people; they’re looking to do a better job of coordinating services across various agencies; they’re trying hard to make sure where there are opportunities to be more efficient that they pursue them; but at the end of the day, what’s certain in the current environment is that absent more money it’s difficult to see how this gap between need and opportunity won’t grow.

Now it is true, unlike K-12, there is no single formula by which these programs are supported. Unlike K-12 in some states, programs are – the costs of them are partially borne by parents or participants. Unlike K-12, the market is interesting because there are private providers as well as public ones. And so where I think some of the innovation is likely to occur looking forward is in trying to figure out new and innovative ways to support programs. But the main thing I would say is yes, absent sustained public support, it’s hard to imagine that these programs will grow; they’ll be struggling to maintain their current service levels.

So you see a lot of declining tax revenue, especially now, and if we’re talking about demand going up but revenue going down, what are some of the ways you’ve seen states work around that, especially in the South?

Well the obvious workarounds – certainly the ones that come up early in these kinds of challenges – are to do things like increase class size – you try to spread more kids into a fixed population of teachers or adults. The next thing you look to do is to shorten the year, because you can save money that way. The big savings or efficiencies are going to be found largely in people: Either you reduce the number of people or hold the line on the number of people working in these programs, or you reduce the slots, and that’s the third thing that you would see. Those are the obvious things you do if you are coming up well short of the resources you need to muster. Then there’s the question of trying to means test or change the parameters in terms of public subsidies so that people who can afford to pay a little more do. Those would be the big ones. That’s where – you could say that’s where the money is.

You know, beyond that, there’s the question of trying to re-think the interaction between state programs and federal ones, so you’re talking about Head Start and maybe some strategic collaboration there. But there’s probably not a whole lot of savings to be found beyond doing one or more of or some combination of those three or four things I just mentioned.

So what do states gain by trying to find these savings – are they getting a lot of money back in the budget by making these kinds of cuts?

Well, the question is how easy it is to spot those gains and how long does it take them to be realized.

But if a huge benefit to participation in a Pre-K program has to do broadly speaking with being more ready for school – bigger vocabulary, word recognition, more likely to be able to learn to read, less likely to be identified as having a learning disability or something like that, then savings actually start to surface pretty early in terms of kids enrolling in first and second and third grade who don’t have learning deficits, behavioral problems and the like that cause them to be enrolled for instance in special education, which on average roughly costs two-point-five times as much as a – quote  - “regular student” – unquote. So there are some near-term benefits in terms of kids who simply arrive at school without being special needs.

And we have argued that those are rather consequential and that they compound over time as you see the kids who had the benefit of early childhood or pre-K move up the grade system more successfully – less likely to drop out, less likely to fall a grade level or more behind, and more likely over the long run to actually graduate from high school and make a smooth transition from college to work.

Those are the longer-term outcomes that you don’t see just around the corner, but there is evidence to suggest there are benefits. So if I were a state and I was looking at high drop-out rates, I was looking at participation rates in special education at 10 to 15 percent, and I was hemorrhaging funds from having to meet these special needs upstream, I might find investments in early childhood to be attractive because there’s so much evidence that suggests that kids who can read well and have a solid vocabulary by the time they are in say the third grade perform much better than average as they matriculate up through the higher grades. So that’s the logic, that’s how you want to think about it if you were a state, deciding whether to fund that or more prison beds, for instance.

I’ve noticed a disparity between urban and non-urban districts; can you address that?

The pattern you suggest is also true for K-12. It has in part to do with the formulas that states use to support public education. And sometimes the urban communities actually look wealthy on paper: They have concentrations of corporate business real estate, and their tax base seems large, so in the eyes of the state, it seems like they have a greater capacity to pay for things like pre-K or K-12. At the same time, these cities are likely to have disproportionately large concentrations of households with families who are poor, kids with special needs, and therefore the cost of providing education can tend to be higher on average than certainly than in the suburbs.

These are sweeping generalizations I’ve made.

As a result, what [states] can spend on a per-pupil basis relative to what they might need to – there’s a gap there, too, and these are the sort of inequities that you see in many state aid formulas that have been a problem for the country, most of the states, forever. This is not a new occurrence. In the 60’s and 70’s and 80’s, there were over 30 or 40 court cases challenging the constitutionality of the way we fund public education largely based on these wealth-related disparities in spending, and those problems are still with us today.

Any last thoughts?

Here’s the reality: the fastest-growing population in the region are kids of color. They are, by now, literally a majority of the students. They are also the students that we have historically served least well. The future of this part of the country hinges to a great degree on seeing to it that these kids are well-educated, become full and thoughtful participants in our democracy, and are skilled enough to compete for a very new and global workforce if we want to see the fortunes of the region – and the country, for that matter – rise. So this is no time to disinvest; it is in many respects the time – a watershed moment – for seeing to it that the fastest-growing population learns well and learns a lot.

What I worry about is that this trend on the demographic side is running in one direction and the forces in terms of public support for public education, pre-K and beyond, is moving in the other direction. Yes, we have to be more efficient and more productive, but what I think we do only at our peril is to ignore this wave of new students and not figure out how to serve them well.

I think there is even less inclination to invest in education in some of the [Southern] states than in other parts of the country. These states are poorer; the economy hit Southern states particularly hard. Taxes are already low relative to the rest of the country. Incomes are lower; these are long-standing trends, particularly in the deep South, and so if these things are true, there’s both this sort of conservative orientation at the state level toward government, and there’s the reality that the ability to pay or support these things is limited, too, compared to Massachusetts or New Jersey, Connecticut or New York. These are long-standing differences in capacity that have been with us for decades.

Some actually would argue – and, in fact, you could interpret the two sentences in the president’s state of the union speech when he talked about universal pre-K – you could argue that this was the closest thing to saying that the federal government has a role to play in leveling the playing field across the states. And if you were serious about that, and you noticed that the highest percentages of kids who were poor; the highest percentages of kids with special needs are in the South, the federal government might play some role in trying to compensate for that. In fact, the federal government always has; Title One’s a good example. If on average, federal support of public education nationally hovers around 6 percent – which it has for decades – that number has been closer to 8 to 10 percent in the South. Why? Because the formulas that drive federal support for those programs are based on underlying definitions of poverty – free and reduced lunch – and those kids are down here in the South. So that need has not changed. All the recession and the fiscal crisis has done is put greater pressure on these states to meet demands that they were never as well-equipped to meet as others.

In Tennessee, where you don’t have an income tax – here’s an example of a state that is missing one leg of the three-legged stool that you typically want to have. Now it just so happens that your governor does intend to hold the line on education spending; at least, that was the last I heard. So I don’t want to be understood as saying that every single state in the South and every single state nationally is cutting, because it’s simply not the case, because some are, some are not.

But in general, the last several have been years of belt-tightening years of modest if not steep cuts in appropriations which have been accounted for in the ways that I [mentioned earlier]: Making the year shorter, reducing the number of slots – or at least holding them constant, holding the line on salaries … the early learning workforce is typically a part-time workforce, typically a workforce where wages are low, where the folks working don’t enjoy healthcare; there are lots of challenges once you pull the covers back to quality as well as quantity. And so at a very time when the states, people running the programs are trying to make them better – national standards have emerged, et cetera, et cetera – you’ve got this growing understanding of what the returns to early childhood are, a lot more research and data on what gives rise to quality – so we’re all dressed up and ready to go to church; the only question is will we find the public will to make these investments, particularly now that we have a sense of what to buy.

Maybe a decade ago or more, we had a few big studies, but we didn’t have a preponderance of evidence at the state and local level that we have now. So you could argue that the good news is that we’re even better positioned to make wise investments, given what we know today, about what good programs look like; we’re in a better position to tie our investments to standards – quality rating and improvement systems. Think about this from a glass half full: We’re smarter and ready to go. We’re well-poised to do good things if we can create the constituencies and arguments for those investments. I would never pit pre-K against K-12 against higher ed – but if you’re a state and you’ve got limited resources and you’re trying to decide where to make the biggest bang for the least buck, it’s hard not to take a look at investing in very young children on the premise that if you can get that right, you’re setting them up to do well over the longer run.

Thank you.

One Comment

  1. Pingback:Southern Education Desk – Getting Ahead With Early Ed? The Debate Over Publicly Funded Pre-K In The Deep South

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