Targeting Investments for Universal Preschool

Several states are extending access to preschool for a widening range of families. Georgia has made dramatic progress toward providing preschool slots for all three and four year old children. Illinois, New Jersey, and New York have taken steps to broaden access, slowed by the economic recession and shifting government priorities.

California may be joining these states. Two blue-ribbon panels have urged the state to create a plan for moving toward universal preschool (UPS), focusing first on low-income families. The proposed master plan for education, recently translated into legislation, calls for incremental implementation of UPS. Los Angeles and San Mateo counties have allocated funds for concerted planning efforts.

It remains doubtful whether Sacramento or local counties can move forward until the state budget picture improves, not to mention concern over the federal budget picture.

Recent history offers a more upbeat picture, suggesting that political will behind preschool access will continue to grow. California steadily pumped new dollars into child care and preschool programs until the recent downturn, rising from $800 million in 1996 to $3.1 billion in the 2002–03 fiscal year. Yet much of this spending growth went for license-exempt child care, allowing preschools and center-based programs to barely keep pace with the state’s growth in child population.

As state and local advocates advance the idea of UPS, their efforts are unfolding under tenuous economic conditions and long-term constraints on public financing. Initial capital for preschool expansion is coming from First 5 Children and Family commissions. But any sustainable move toward a more accessible, higher quality network of preschool programs would require program realignment and investment at the state level.

This paper, then, asks—how might public funds be effectively targeted to yield strong enrollment demand by parents and discernible effects on young children’s early development and school readiness?

The paper aims to illuminate how state and local planners might weigh the plusses and minuses of differing targeting priorities. It does not advocate a particular policy. For instance, Los Angeles County—which has allocated $100 million for UPS—could focus new investments on communities

• with the lowest performing students on standardized tests, scores which are tightly correlated with neighborhood wealth or poverty;

• with the lowest supply of preschool slots for young children, neighborhoods that may be poor or working class in composition; 

• where the pent-up demand for preschool is highest, that is, neighborhoods where family demand outstrips current supply.

This paper analyzes how these alternative targeting mechanisms—if applied to Los Angeles County—would yield differing allocations to various communities.

The risks associated with not entertaining alternative targeting methods are great. Scarce public dollars could be inefficiently spent, for example, directed to communities where an excess supply of preschool programs already exists (given current levels of family demand). In addition, early efforts to broaden preschool access will hopefully yield a strong demand response from parents who are eager to enroll their children. Yet funding could be allocated to communities where few families respond, due to low maternal employment rates or tepid responses by certain groups of parents.

Current patterns of family demand, in part, are conditioned by supply conditions. That is, unless families have the option of quality center-based programs, they cannot express demand for it. Yet if additional preschool slots were created, the demand response would be unequal across communities, given that maternal employment, parent education, and family structures vary—factors that have been shown to contribute to demand for preschool programs.

While the present paper utilizes local data from Los Angeles County, it illustrates how policymakers and planners might think through allocation options—estimating how particular communities and families benefit more, or less, under different targeting strategies. We discuss the advantages of experimenting with alternative expansion strategies, rather than investing exclusively in one method.

This paper is organized in the following manner. First, it briefly describes the current institutional arrangements and financing streams that support the state’s current network of preschool organizations, family child-care homes (FCCHs), and individual caregivers, increasingly subsidized via child-care vouchers. Then, for each of the three targeting strategies, it describes which Los Angeles communities (zip-code areas) would benefit most, compared to those that would benefit least. We show that alternative allocation strategies can yield quite different effects among low- and middle-income communities. It also considers the a priori criteria that might be used in judging the wisdom of targeting options.