Infant Toddler Rate Increase

September 2010

Infant Toddler Rate Analysis

Based on the analysis of rates for educators in infant and toddler programs, and in alignment with the implementation of multiple Department initiatives focused on this age group, EEC proposes a 3% increase to rates paid to educators serving infants and toddlers in Massachusetts. Upcoming initiatives with increased expectations of educators include:

The Development of Infant and Toddler Learning Guidelines These Guidelines are intended for all types of early education and care settings that care for children from birth through thirty-six months of age. They describe how programs and educators can best support the healthy development of infants and toddlers. They are structured to facilitate their use for professional development, are aligned with EEC’s existing Preschool Guidelines for Three and Four Year Olds and with the EEC Core Competencies. They address brain development, emphasize relationships as a key factor across all development domains, and reflect values inherent in a strength based approach.

Birth to School Age Task Force Report Recommendations Multiple recommendations speak to the need to for increased compensation for providers and for quality services for infants and toddlers.

Quality Rating and Improvement System (QRIS) Includes standards for increased qualifications for staff in high quality programs.

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Infant Toddler Rate Analysis

Objective: Recommend to Board rate increase that:

1. Reduces the gap between EEC Rates and Market Median.2. Rate increase falls within available funding & budget constrictions.3. Rate increase is sustainable.4. Maintain rates by region.

The 2009 Child Care Market Survey results indicate EEC rates are significantly below median by region & type of care.

The six regions percentage variance to median ranges are:1. Center Based Child Care Blended Rate Ranges: 5.05% to 20.47%.

2. Family Child Care Rate Ranges: 5.94% to 33.94%.

EEC reviewed various rate scenarios Assumptions:

1. Blended Infant/Toddler rate used for region & type of care.2. FY2010 average headcount was used to calculate forecasted

spending to account for attrition.

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Infant Toddler Rate Analysis

EEC reviewed various rate scenarios Results:

1. In order reduce the gap between the current EEC Rate & Market Survey Median the percentage increase would vary between region & type of care.

2. We reviewed percentage increases ranging from 1% to 12%.3. Two of the six regions, Northeast and Greater Boston center

based blended rate currently has the largest gap to the median and current child care rate is highest.

4. Three regions Northeast, Greater Boston and Boston family child care blended rates have significant variances to the median and also have the highest child care rate.

5. Annualized dollar impact at 3% increase ranges from approximately $2.8 to $3.3 million.

Note: Projected dollar spending increase is dependent on numberof children & infant/toddler headcount mix and the rate (blended rate and/or Infant & Toddler individual rates) that the percentage increase is applied.

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Infant Toddler Rate Analysis

Recommendation:

To implement an increase to the Infant/Toddler rate. The impact to ARRA funding for nine months concluding with the Federal FY2011 - September 30, 2011 will be approximately $2.1 million.

1. A flat percentage increase of 3% increase for all regions & type of child care facility.

2. Rate increase effective January 1, 2011.3. Impact to spending for State FY2011 is six months - $ 1.4 million. 4. Impact to ARRA funding for Federal FY2012 ending

December 31, 2011 - $700,000.5. Forecasted State FY2010 spending - $2.8 million.

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Infant Toddler Rate Analysis

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Region EEC Rate Blended Rate

Market Survey Median

Blended Rate

Recommended Daily Rate

3% increase

Average Headcount

FY2010

SFY 2011 6 Mths. *

FFY 2011 9 Mths. *

Annualized $ Impact *

1 - Western 1,491 227,408$ 343,756$ 460,104$

- Center Based Child Care $45.60 $48.69 $46.97 895 157,942$ 238,750$ 319,558$

- Family Child Care $30.10 $32.00 $31.00 596 69,465$ 105,005$ 140,546$

2 - Central 772 115,320$ 174,321$ 233,323$

- Center Based Child Care $46.70 $52.00 $48.10 353 63,827$ 96,483$ 129,139$

- Family Child Care $31.80 $36.50 $32.75 419 51,493$ 77,838$ 104,183$

3 - Northeast 1,858 281,894$ 426,118$ 570,343$

- Center Based Child Care $52.30 $63.50 $53.87 689 139,387$ 210,701$ 282,015$

- Family Child Care $31.50 $39.00 $32.45 1,169 142,507$ 215,417$ 288,328$

4 - Greater Boston 634 128,517$ 194,271$ 260,024$

- Center Based Child Care $56.15 $70.60 $57.83 524 113,884$ 172,150$ 230,416$

- Family Child Care $34.35 $52.00 $35.38 110 14,634$ 22,121$ 29,608$

5 - Southeast 1,689 283,760$ 428,939$ 574,119$

- Center Based Child Care $46.05 $48.50 $47.43 1,379 245,712$ 371,425$ 497,138$

- Family Child Care $31.80 $40.00 $32.75 311 38,048$ 57,514$ 76,981$

6 - Boston 1,979 325,761$ 492,429$ 659,097$

- Center Based Child Care $51.50 $58.50 $53.05 1,092 217,641$ 328,992$ 440,344$

- Family Child Care $31.50 $31.50 $32.45 887 108,120$ 163,437$ 218,754$

8,423 1,362,659$ 2,059,834$ 2,757,009$

* 3% increase over current blended rate.

Infant Toddler Rate Analysis

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Current Annual Revenue/Classroom   

   

     # of Children Rate per Day # Days   Total

  7 $46.70 260   $ 84,994             Expenses          

           Staffing Lead $ 31,200      

  Teacher $ 24,960        Teacher $ 24,960        Site Mgmt. $ 6,000   $87,120.00  

  Benefits @ 20%     $17,424.00    Occupancy        

  Maint. &

Utilities   $ 2,500.00    Mortgage Int.   $ 1,400.00    Office Costs        

 

Phones, Computers, Liability Ins., etc.   $ 2,000.00  

  Supplies     $ 800.00    Training     $ 750.00    Depreciation     $ 2,000.00    General Admin.     $ 5,524.61            $ 119,518.61   Net Loss $ (34,524.61)  Net Loss/Child/Day $ (18.97)  Net Loss/Child/Year $ (4,951.06)

           

Below is an example of a center based program’s revenues/expenses from one of their Infant/Toddler Classrooms.  In this program, EEC revenues total $84,994 annually, while expenses total $119,518, for a total loss of $34,524 annually ($4,951/child).  This program serves eighty-seven EEC funded Infants and Toddlers, which reflects a total annual loss of $430,737 to provide these services.