Saving Daycare Access in California

California is in a daycare crisis. We need universal coverage to stabilize the provider industry or costs will force more new families to leave our region and state.

If you haven’t read about it or spoken with a daycare provider recently in California, there is a serious problem facing the community of small businesses that give parents early childcare support before they enter public school. In essence, our state’s expansion into public coverage just for age 4 as a means to shore up lost student enrollment in public schools has put tremendous strain on the financial models of providers who cover children from 0-4. 

This is because daycare providers cross subsidize tuitions for age 4 children to pay for the very high costs of age 0-2. By removing the critical source of revenue from providers without providing an alternative support to cover the costs of children from age 0-2, California will begin driving providers out of business completely (potentially 30% of daycare access have already closed since the public TK expansion), while forcing those that remain to raise prices dramatically, potentially more than $1000 a month per child, in order to stay afloat.

I'm running for California's Senate so the East Bay can be a place for new families. As the only candidate with young children who recently finished my own daycare experience, I am very worried about the future here for new families. I intend to change our support structure to truly serve the needs of parents. If you send me to Sacramento, I will introduce and enact legislation that will bring comprehensive age 0-4 coverage in order to stabilize providers, increase options, and lower costs for parents. 

If you're a parent, you know how hard finding and affording infant and early childhood care already is today.

For those who aren't, infant daycare costs at least $20,000 annually (before the pending price increases), per child in Alameda and Contra Costa counties. That rate drops to $15,000 for toddlers because they require fewer staff per child. These costs are a burden for most households and almost entirely paid by parents. The costs are simply unmanageable for low-income and single income families. And these costs are going to go way up absent comprehensive reform to cover all parents from age 0-4.

The Cost of Inaction is Greater Than the Cost of Investment

California’s decision to make public pre-K available to 4 year olds is a problem. While I agree with the goal that all 4 year olds should have access to excellent early childhood education in our state, we seem to forget the importance of age 0-3 with that premise. More importantly, limiting support to just 4 year olds has the perverse result of raising prices and pushing facilities to close that cover age 0-3.

Comprehensive coverage is necessary beyond just age 4. Early childhood education instructors give kids a foundation for success and parents peace of mind during the workday. Children's brains develop during their first five years faster than at any other point in their lifetimes. This developmental stage can be a powerful opportunity to lock down building blocks, get kids used to a classroom setting, improve social skills, and instigate lifelong love of learning.

Families take on debt or have hard discussions about one parent leaving the workforce to care for their babies and toddlers. This interrupts career pathways and translates into higher lifetime income loss. Typically, this burden falls on working mothers because of already existing wage differences, only made worse by our own state government’s decision to disrupt the provider market. Since women stay home most often, this pressure has major downstream effects on the gender pay gap and equity in the workplace. High early childhood costs are one of the reasons so many families are leaving the state now. However, despite the high costs (almost entirely financed by young parents now), many early childhood educators and infant care businesses still struggle to turn a profit. 

One parent that I talked to described the process of applying for slots in early childhood centers like the Hunger Games. My wife and I went through over 15 separate applications to get our first child into a center and know how the hunt alone is a huge stress for parents. The fact that it is only going to get harder and more expensive is intolerable. This can be fixed, but it requires the legislature to dig deep in finding a comprehensive solution, and soon, before the damage can’t be reversed. 

We Need to Pass Comprehensive Childcare Coverage

The impact of losing 4-year olds is particularly pronounced despite warnings Sacramento received about disrupting financial models of daycare access. Since 4 year olds are usually relatively more advanced and self-sufficient than 2 and 3 year olds or infants, they can be staffed much more affordably. Having 4 year olds in the system makes up lost revenue and puts downward pressure on prices across the board in the aggregate. 

To prevent the daycare crisis from getting worse, we must move forward with comprehensive coverage for all parents, not just a small number that rely on state contracted providers. We need to enable parents’ choices from age 0-4 to the provider of their choosing in both public and private options. Parents' schedules typically dictate whether public TK is even viable for them in the first place, we need to be broader in our support of raising kids and flexible with their needs.

If elected, I would introduce legislation to increase government investment up to $1000 per child in early childhood education and infant care through 5 years for all new parents.

Vermont has recently enacted comprehensive coverage that provides a good model for California to follow. In essence, we need to increase our per child investment of public money into the age 0-5. There are a number of ways to finance this, by providing parents with direct funding like the recently expired federal child tax credit that led to a 46 percent decline in child poverty. The state can provide direct support to all providers, not just state contracted ones that serve a narrow set of parents, to bring down their costs which translates into lower tuition paid by parents. This support should apply to parents for the first five years of raising kids and be flexible in its application.

This reform would also preserve families' ability to choose the best fit for them. Parents shouldn't face pressure to leave a school they like for a TK option they don't want. Peoples' reasons for staying, or leaving, can be diverse and individualized. Anything from instructional style or a beloved teacher to maintaining a friend group or carpool arrangement could motivate families to choose private school or TK. Ultimately, the goal should be empowering families to make the best decision for themselves.

We need to set the goal of increasing the investment to reach an average of $1000 per month per child for the first five years of life and move to cap childcare spending by parents at no more than 10% of annual income. The goal of these reforms are to enable working moms (and dads) to keep their jobs if they so choose rather than be forced to surrender their income and career prospects to have children. We also don’t want young people starting families to decide they need to leave the Bay Area entirely to have kids. An exodus like that will lower revenues for our local governments, lower enrollment even further at our public schools, and shrink the community of people who share the journey of raising kids in the region.

Remember that parents are already spending in excess of $2000 a month per child completely on their own today, which forces a lower income earning parent in a two income household to surrender their income as the least expensive option. By raising the support, we can enable more working moms to stay at their jobs if they so choose rather than force the decision on them to leave work and lose future earning potential. Comparatively, by increasing the per child investment up to $1000, California would be on par with the average EU nation (see chart below) while dramatically ahead of the U.S. national average, which is only $41.60 per month per child. 

I would work with the private industry on financing because they too are facing challenges retaining workers who are forced to leave their job in order to afford to be parents in the Bay Area. It is likely that many business leaders are seeing the impact on their workforce from the daycare crisis where they too would benefit from investing in parents in their early stage of family. For both the economy and community, the costs of inaction are far greater than the investment. If we do not make the Bay Area a place where raising a family is easier, we will set the stage for greater flight from our region that is already facing enormous pressure on housing costs, crime, and homelessness.