August 5, 2015

In Some States, Pre-K Providers That Have the Money, Keep the Money, and That’s a Problem

By Bellwether

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Charter schools should offer pre-k. Sometimes they can, and sometimes they can’t. One reason they can’t: Policies in ten states privilege existing pre-k providers. When these states allocate pre-k funding, they allocate funding first to providers that are currently serving children, leaving little — if any — funding for charter schools that aren’t existing providers, which many aren’t. So the providers that have the money, keep the money.
There are good reasons to structure a state pre-k program this way. Funding existing providers affords a measure of stability to families and programs. It’s also reasonable to believe that a provider with experience running a pre-k program would know how to do it better than a brand-new provider. And in some states, like New Jersey, pre-k allocations to providers include funding to improve program quality. A provider in its fifth year has received five years’ worth of state funding for program improvement. If a state allocates the funding to a new provider, it loses its investment.
But privileging existing providers closes off new opportunities for high-quality pre-k options – especially charter pre-k options. Early education is an established “diverse delivery” system: many types of providers, including Head Start programs, public schools, private childcare centers, and community-based nonprofits, are permitted to serve children. Charter schools exist through a similar premise in K-12 education. Both systems assume that resources are scarce and should go to the best possible provider. The difference is that some pre-k programs assume the best provider is the current provider, while the charter model assumes that new types of providers might offer better options than those that currently exist. If providers can’t deliver results for students, resources are reallocated to a provider that can. This theory of action provides additional classroom options for parents and spurs innovative human capital and teaching models. Without it, there’s little incentive to innovate or improve.
Ten states hamstring new providers from competing for state pre-k funding. In California, Delaware, Illinois, and Kansas, new providers are only eligible to compete for pre-k funding if the state appropriates additional funding to the program. If funding levels stagnate, only existing providers can continue to receive funding. In Delaware, Georgia, Louisiana, North Carolina, and Pennsylvania, the application process for pre-k funding awards additional points for existing providers. And in Georgia, New Jersey, and New Mexico, the state will only approve new providers if it identifies unmet need in the community, regardless of any promising innovations offered by the potential provider.
The best way to address this barrier depends on the state, but in our paper for the Thomas B. Fordham Institute, Sara and I recommend that states “recompete” pre-k funding between new and existing providers on a set cycle, even if funding for the program does not increase.
We also recommend that program quality should be the top priority when agencies make funding decisions. There’s an ongoing discussion about how to best monitor the quality of pre-k programs, particularly those operated by charter schools, which I’ll get into in a later post. But we think states should evaluate existing providers primarily on evidence of child learning and developmental outcomes – in addition to compliance with standards, sound fiscal management, and quality of adult-child interactions. Instead of prioritizing who had the money, prioritize who spent it best.

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