Help us set subsidy rates by taking the Market Rate Survey

The Department of Early Learning needs your help to better serve the needs of licensed child care providers. We have just launched this year’s leaner, simplified Market Rate Survey. The survey will take about 15 minutes to complete and is open to all licensed providers in Washington state. DEL is required by the federal government to conduct this Market Rate Survey. The results from the survey will be used to inform child care subsidy rates. You can help by taking the survey if you are a licensed provider, and if not, you can help promote it!

DEL has conducted Washington State’s Market Rate Survey since 2007, as the lead agency for the Child Care Development Fund. The survey asks questions about licensed providers' child care and the children they serve. Topics covered include enrollment, private tuition rates, staff education and compensation, and support services offered. The survey includes several important updates this year:

• DEL is partnering with Public Consulting Group, Inc. (PCG) to deploy the survey.
• Shorter and more concise format than previous years.
• Web-based format with email, telephone, and postcard contacts planned.
• Translations available for providers who speak Spanish and Somali.
• Telephone interpreters available for additional languages.

To inform subsidy rates, your participation is very important! To reach our response rate goal of 75 percent for licensed centers and licensed family homes, we need your help. DEL would appreciate if you could take the survey, help promote it to other child care providers, or both! Providers can check their email for a link to the survey, subject line “Market Rate Survey.” Or, providers can access the survey at this link: http://surveys.pcgus.com/s3/WADELMRS.

The survey will close April 20 or after we receive our response rate goal, whichever comes first. You can also contact PCG at wamarketratesurvey@pcgus.com or (844) 880-8714 with any questions. Thank you!

Why Subsidy Rate Increases Matter to Everyone--Even if you aren’t a family on subsidy

Talking about base rate increases for child care providers who accept children on subsidy can seem a little wonky. You may think it’s important only to those families and providers it touches directly. But this is one of the key issues facing our child care system in Washington. The Department of Early Learning believes that we need rate increases for Family Homes and Child Care Centers across the state if we want the system to survive. 

A single parent with two children has to be making $40,320 a year or less in order to qualify for our subsidy program. A family of four is limited to $48,600 a year. If you’re making even a dollar more than that, you’re paying the full price of child care costs.

Everyone knows that the cost of child care has risen steadily in recent years. We know too that the average family’s wages have not kept pace with this rising cost. How does the State help? We provide subsidies to low-income families so that they can access high-quality child care in the communities where they live. These subsidies pay the owners and employees of Family Home and Child Care Centers to deliver early learning services.  

 So are the providers raking in money hand-over-fist when they accept subsidy payments? The simple answer is no. Our federal funding partners from the Child Care and Development Fund (CCDF) want our subsidy rates to be at in the 75th percentile of market-rate child care [1], and our state is nowhere close to that. That’s why our Governor put into his budget proposal this year a 2% base rate increase for Family Homes, and a tiered reimbursement increase for Child Care Centers. That was to get us closer to that 75th percentile before accounting for the January minimum wage increase.  

We know that minimum wage increases enacted in I-1433 will benefit child care workers. Hopefully it will have a positive influence on childcare quality given the association between employee compensation and childcare quality. However (and that’s a big however) there are some very real problems this wage increase creates for the child care system.  

In order to understand the effects of I-433 on the child care system, we conducted a Minimum Wage Impact Survey Analysis. This report suggests that costs for providers are going up 1% for Family Homes and 3.5% for Child Care Centers, in addition to cost increases as a result of inflation. 

The biggest element of cost for child care providers is labor (about 60%, significantly higher than most other business types). If we drive down their revenue relative to their costs because of wage increases they have only a few options: 

• Pass the increased costs onto private-pay families. This hurts the middle class and those struggling to make it into the middle class (remember the part above about sky-rocketing child care costs?) 
• Stop serving children on subsidy. This will bankrupt small businesses who rely on subsidy families for their business model and will force more families into dangerous, unlicensed care scenarios. 
• Hire less educated, lower quality staff. This will reduce educational outcomes. 

These are not options that child care providers like, and they are not ones we want to see either. We want to get more children into high-quality early learning programs so that we can get them ready for kindergarten, regardless of race or family income. We want to ensure that every parent or guardian who waives goodbye to their child at the beginning of the day can feel confident about his or her safety.

To keep the system whole, to not unduly burden middle class families, and to continue our quest for quality, we need to be thinking about subsidy base rates. 

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[1] Meaning subsidy families have access to at least three-quarters of all available child care.