Education and Care: Early Childhood Programs and Services for Low-Income
Families (Letter Report, 11/15/1999, GAO/HEHS-00-11).

Pursuant to a congressional request, GAO provided information on federal
child care funding, focusing on: (1) programs and services funded at the
federal and state levels that directly provide early childhood care and
education for the general population of low-income children up to age 5;
(2) state and local assessments of the relative difficulty low-income
parents face in obtaining care for their children; and (3) the
collaborative efforts among child care officials and early childhood
education officials to address these parents' difficulties.

GAO noted that: (1) the federal government invested about $11 billion in
fiscal year 1999 on early childhood care and education programs for
low-income children through a range of programs and the states invested
almost $4 billion for such programs; (2) the Department of Health and
Human Services (HHS) provides most of the federal support for early
childhood care and education, about $8 billion, through the Head Start
program and the Child Care and Development Fund, which subsidizes the
child care expenses of low-income working parents; (3) other HHS and
Department of Education programs provide the remaining funding for early
childhood care and education; (4) 32 states reported funding preschool
programs, 15 states reported providing state money to supplement Head
Start, and 19 states reported child care programs that provided funding
to communities; (5) GAO's survey results showed that educationally
oriented services were the most common services providers offered in
centers and homes; (6) providers were less likely to include other
services; (7) although a number of federal and state programs provided
significant funds for early childhood care and education, some types of
child care were still difficult for low-income families to obtain,
including: (a) infant and toddler care; (b) care for children who have
special needs; and (c) care for children during nonstandard hours; (8)
in contrast, a majority of the survey respondents indicated that care
for 3- and 4-year-olds was generally not difficult to obtain; (9)
childcare administrators identified three major barriers to finding care
for low-income children: (a) cost of care, especially for infants and
toddlers; (b) availability; and (c) accessibility; (10) some states and
localities are using collaborative initiatives to better bridge child
care programs and early childhood education programs as well as the
federal and state programs; (11) all the states GAO visited reported
increased availability of full-time care for 3- to 5-year-olds as a
result of collaborative efforts and more limited success in increasing
the availability of infant and toddler care or care during nonstandard
hours; (12) however, barriers to collaboration still remain, according
to state officials and survey respondents; and (13) the types of care
that have the greatest need for support are infant and toddler care,
care during nonstandard hours, and care for children with special needs.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-00-11
     TITLE:  Education and Care: Early Childhood Programs and Services
	     for Low-Income Families
      DATE:  11/15/1999
   SUBJECT:  Children
	     Child care programs
	     Preschool education
	     Public assistance programs
	     State-administered programs
	     Disadvantaged persons
	     Interagency relations
	     Grants-in-aid
IDENTIFIER:  HHS Child Care and Development Fund
	     Social Services Block Grant
	     Colorado
	     North Carolina
	     Ohio
	     Oregon
	     Head Start Program
	     HHS Temporary Assistance for Needy Families Program
	     Even Start Program

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Cover
================================================================ COVER

Report to Congressional Requesters

November 1999

EDUCATION AND CARE - EARLY
CHILDHOOD PROGRAMS AND SERVICES
FOR LOW-INCOME FAMILIES

GAO/HEHS-00-11

Low-Income Childhood Care

(104930)

Abbreviations
=============================================================== ABBREV

  CCDF - Child Care and Development Fund
  HHS - Department of Health and Human Services
  IDEA - Individuals with Disabilities Education Act
  NACCRRA - National Association of Child Care Resource and Referral
     Agencies
  SSBG - Social Services Block Grants
  TANF - Temporary Assistance for Needy Families

Letter
=============================================================== LETTER

B-281005

November 15, 1999

The Honorable Judd Gregg
Chairman, Subcommittee on Children and Families
Committee on Health, Education, Labor, and Pensions
United States Senate

The Honorable William Goodling
Chairman, Committee on Education
 and the Workforce
House of Representatives

The Honorable Michael N.  Castle
Chairman, Subcommittee on Early Childhood,
 Youth, and Families
Committee on Education and the Workforce
House of Representatives

Billions of federal and state dollars annually support multiple
programs to address the early childhood care and education needs of
low-income families.  Information from these programs on the
availability and accessibility of care and services that children
receive is of great interest for several reasons.\1 Recent
developments in the 1996 welfare reform legislation require more
welfare families, including those with very young children, to find
and keep jobs.  Also, much attention has been given to the
relationship between child care experiences and school readiness. 
Finally, the existence of multiple funding sources for early
childhood care and education has increased some states' interest in
using program collaboration. 

Recently, a number of congressional proposals have been made to
increase federal child care funding.  Therefore, you asked us to
describe (1) programs and services funded at the federal and state
levels that directly provide early childhood care and education for
the general population of low-income children up to age 5, (2) state
and local assessments of the relative difficulty low-income parents
face in obtaining care for their children, and (3) the collaborative
efforts among child care officials and early childhood education
officials to address these parents' difficulties.  Much of our data
came from a survey of child care administrators and departments of
education in all 50 states and the District of Columbia and from a
survey of all 537 child care resource and referral agencies in the
membership database of the National Association of Child Care
Resource and Referral Agencies (NACCRRA).\2 We also visited Colorado,
North Carolina, Ohio, and Oregon, which the National Governors
Association had identified as leaders in collaborative efforts for
early childhood care and education, and we visited two counties, one
mostly rural and one mostly urban, in each of these states.  We
interviewed program officials at all levels and early childhood
researchers, and we reviewed related reports of research
organizations.  We did work in accordance with generally accepted
government auditing standards between August 1998 and October 1999. 
(See appendix I for more details on our methodology.)

--------------------
\1 In this report, "early childhood care and education" includes care
that is provided to low-income children whose parents are out of the
home in work activities and who may be in a center or a home, as well
as care that is focused on a child's education, such as care that
preschools and Head Start provide. 

\2 NACCRRA's membership database contains 537 of an estimated 800
agencies nationwide. 

   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The federal government invested about $11 billion in FY 1999 on early
childhood care and education programs for low-income children through
a range of programs and the states invested almost $4 billion for
such programs.\3 The Department of Health and Human Services (HHS)
provides most of the federal support for early childhood care and
education, about $8 billion, through the Head Start program and the
Child Care and Development Fund (CCDF), which subsidizes the child
care expenses of low-income working parents.  Other HHS and
Department of Education programs provide the remaining funding for
early childhood care and education.  Thirty-two states reported
funding preschool programs, 15 states reported providing state money
to supplement Head Start, and 19 states reported child care programs
that provided funding to communities.  Our survey results showed that
educationally oriented services (for example, numeracy and literacy
activities) were the most common services providers offered in
centers and homes.  Providers were less likely to include other
services, such as family social services or medical referrals. 

Although a number of federal and state programs provided significant
funds for early childhood care and education, some types of child
care were still difficult for low-income families to obtain,
including infant and toddler care; care for children who have special
needs, such as children with physical disabilities; and care for
children during nonstandard hours (evenings and weekends).  In
contrast, a majority of the survey respondents indicated that care
for 3- and 4-year-olds was generally not difficult to obtain.  Child
care administrators identified three major barriers to finding care
for low-income children--cost of care, especially for infants and
toddlers; availability; and accessibility, such as transportation to
get to providers, described as more difficult in rural and remote
areas. 

Some states and localities are using collaborative initiatives to
better bridge child care programs and early childhood education
programs as well as the federal and state programs.  During our
visits to Colorado, North Carolina, Ohio, and Oregon, officials at
all levels reported that collaboration among child care and early
childhood education program officials and nonprofit organizations
improved the availability of education and care services for
low-income families and enhanced the quality of care.  Officials from
these states reported using in these collaborative efforts similar
strategies to provide incentives for local collaboration, such as
additional funding.  For example, in Ohio CCDF and Head Start
officials pool resources by sharing staff to add full day care to the
half-day Head Start program and to add Head Start services, such as
nutrition and medical care, to day care programs.  All the states we
visited reported increased availability of full-time care for
3-to-5-year-olds as a result of collaborative efforts and more
limited success in increasing the availability of infant and toddler
care or care during nonstandard hours.  However, barriers to
collaboration still remain, according to state officials and survey
respondents.  Factors they identified as impeding collaboration
included differing eligibility requirements; "turf" issues, such as
concerns about losing program authority; lack of information on
different programs; and the lack of funding to support collaborative
activities.  These barriers generally reflect the division between
the child care and early childhood education communities. 

The types of care that currently have the greatest need for support
are infant and toddler care, care during nonstandard hours, and care
for children with special needs.  In the states we visited,
collaborative efforts have yielded some positive results in
addressing child care and education needs.  Information on them may
be useful to other states and communities. 

--------------------
\3 We included only major programs that low-income parents can use to
obtain child care.  For the total federal funding figure, we included
only programs that directly provide (1) child care or education or
(2) funds to provide child care and education for low-income children
up to age 5.  We did not include programs that support but do not
provide funding for child care, such as the U.S.  Department of
Agriculture's Child and Adult Food program, child care tax
expenditures at the federal and state levels, programs with a limited
eligibility, or the Stewart B.  McKinney Homeless Assistance Act. 
For a detailed list of other sources of federal funding available for
child care, see Federal Child Care Funding (GAO/HEHS-98-70R, Jan. 
23, 1998).  The $4 billion figure for state funding represents data
from our survey on state expenditures.  This does not represent the
entire state investment but it does reflect state contributions for
programs within the scope of our review. 

   BACKGROUND
------------------------------------------------------------ Letter :2

Early childhood care and education are generally provided in three
types of settings:  in the child's home, in the home of a provider,
and in a center or other nonresidential setting.  Providers in a home
setting that are regulated by the state are required to meet certain
operating standards established by state or local governments, such
as a maximum number of children per staff.  Unregulated providers may
or may not meet such standards.  Most care provided in centers is
regulated, although some states exempt centers if they are sponsored
by a religious group or government entity.  Further, within a
particular setting--whether a home or a center--the specific services
provided can range from solely child care assistance to a full
continuum of services such as children's educational activities,
immunization referrals, and developmental assessments and parental
literacy and job training, referrals to social services, and
parenting-skill training. 

Historically, early childhood care programs and early childhood
education programs have existed as separate systems with different
goals.  The primary goal of child care programs has been to subsidize
the cost of care for low-income parents who are working or engaged in
education and training activities.  At the federal level, child care
is primarily supported by CCDF.  In contrast, early childhood
education programs have generally focused on helping children become
ready to begin school.  The largest such program is Head Start.  This
split is also reflected at the state level in child care subsidy
programs and preschool programs. 

The Personal Responsibility and Work Opportunity Reconciliation Act
of 1996 (P.L.  104-193) is directed at increasing low-income
families' reliance on work rather than welfare.  This legislation
established Temporary Assistance for Needy Families (TANF), a program
designed to help welfare recipients move into the workforce. 
Previously, under Aid to Families with Dependent Children, most
states exempted single parents with children younger than 3 from
participating in education, training, or work-related activities. 
However, under the new welfare reform legislation, most states exempt
only single parents with very young children, and most recipients are
now required to participate in work or work-related activities.\4 In
addition, increased emphasis on moving people off welfare and into
work activities may result in parents with low skills being employed
in evening-shift and weekend work activities.  As a consequence, this
legislation could increase the demand for some types of child care,
specifically infant and toddler care and nonstandard hour care, for
both families on welfare and those moving into the workforce.\5

Concern over the kind of services low-income children receive while
their parents work has been underscored by research.  Although the
relative importance of recent neurological research on early brain
development is controversial, a large body of research from child
development experts and quality-of-care studies indicates that
developmentally appropriate experiences for very young children are
beneficial.  In addition, concern in many states over the number of
children who arrive in school with poorly developed skills necessary
for learning, such as fine motor and general cognitive skills as well
as social skills, adds to the interest in what kind of care and
services are most effective for school readiness. 

--------------------
\4 TANF has no exemption based on the age of children but allows
states to exempt parents with children younger than 1.  Twenty-four
states exempt parents with children up to 1 year of age, 15 states
exempt parents with children 6 months of age or younger, and 4 have
no exemption related to children's ages.  Two states allow counties
to set the exemption age.  The 5 other states have exemptions at
various ages older than 1 year.  In addition, the states may not
reduce or terminate assistance to a single custodial parent of a
child younger than 6 who has demonstrated the inability (as
determined by the state) to obtain needed child care. 

\5 See Welfare Reform:  Implications of Increased Work Participation
for Child Care (GAO/HEHS-97-75, May 29, 1997) and Welfare Reform: 
States' Efforts to Expand Child Care Programs (GAO/HEHS-98-27, Jun. 
13, 1998), for a more complete discussion of welfare reform and child
care. 

   FEDERAL AND STATE GOVERNMENT
   PROGRAMS FUND A VARIETY OF
   EARLY CHILDHOOD CARE AND
   EDUCATION SERVICES
------------------------------------------------------------ Letter :3

In 1999, the federal government provided approximately $11 billion
through multiple programs administered by HHS and Education to fund a
variety of early childhood care and education services--mostly
targeted to low-income children.  In addition, many states support
care and education by funding preschool programs and providing grants
to communities to increase the supply of child care.  These programs
are often targeted to a specific population, such as children up to 3
or 3- and 4-year-olds from low-income families.  Our surveys of state
child care administrators and resource and referral agencies provide
information on the variety of services offered in home and center
settings.  These services most often focus on educational activities
but also occasionally include meals, immunization referrals, parental
support services, and social service referrals. 

      HEAD START AND CCDF PROVIDE
      MOST SUPPORT FOR EARLY
      CHILDHOOD CARE AND EDUCATION
---------------------------------------------------------- Letter :3.1

Of the $11 billion in federal support for early childhood care and
education for low-income children, almost $8 billion is provided
through Head Start and CCDF, as shown in table 1. 

                          Table 1
          
          Major Federal Programs That Funded Early
           Childhood Care and Education for Low-
            Income Children in Fiscal Year 1999

                                                Funding in
Program             Target age    Department      millions
------------------  ------------  ------------  ----------
Head Start                                          $4,660

Early Head Start    Birth to 3    HHS                349.4

CCDF                Birth to      HHS                3,167
                    12\a

TANF

Funds transferred   Birth to 12   HHS                636\b
to CCDF

Funds used for      Not           HHS                259\b
child care          specified

Social Services     Not           HHS                285\c
Block Grants        specified

Title I, part A     Pre-K         Education          936\d
                    through 12

Individuals with
Disabilities
Education Act

Preschool Grants    3 to 5        Education            374

Grants for Infants  Birth to 2    Education            370
and Families with
Disabilities

Even Start          Birth         Education            135
                    through 8

21\st Century       All           Education            200
Learning Centers
----------------------------------------------------------
\a According to HHS, it does not track the amount of funds spent by
age group, including birth to 5 years. 

\b Figure is for fiscal year 1998. 

\c Total fiscal year 1999 appropriation was $1.9 billion.  The states
have historically reported spending on average about $285 million
from Social Services Block Grants on child care, or 15 percent. 

\d Total fiscal year 1999 appropriation was $7.8 billion.  In
previous years, an estimated $156 million, or 2 percent, supported
pre-K programs and $936 million, or 12 percent, supported pre-K and
kindergarten children. 

Head Start, established in 1965, focuses on providing early childhood
education and developmental services for low-income preschool
children and their families through grants to local agencies. 
Specifically, services for children focus on education (such as
literacy activities), socioemotional development (such as activities
developing self-concept), physical and mental health (such as
immunizations), and nutrition (such as meal and nutrition awareness). 
The program also provides some parental support services (such as,
referrals to social services).  Head Start primarily serves 3- and
4-year-olds in part-day and full-day programs.\6 At least 90 percent
of the children enrolled in a program must come from families whose
income is at or below the federal poverty line or who are receiving
public assistance.\7 In fiscal year 1999, an estimated 1,520 grantees
participated in Head Start, serving slightly more than 831,000
children.  Early Head Start, which began in 1995, was designed to
enhance the development of infants and toddlers and to promote
healthy family functioning and healthy prenatal outcomes for pregnant
women.  For fiscal year 1999, the Congress earmarked $349.4 million
for Early Head Start.  The program reports having served 39,000
infants and toddlers in that year. 

The other major HHS program is CCDF, which in fiscal year 1999
provided $3.2 billion to states to subsidize child care expenses for
children younger than 13 in low-income working families.  Federal law
allows the states to use CCDF to help working families or families
preparing for work with an income of less than 85 percent of the
state median income.  In practice, however, many states establish
lower income eligibility levels.  Federal regulations also require
that the states target a portion of CCDF funds to welfare recipients
working toward self-sufficiency or to families at risk of welfare
dependency and that they use at least 4 percent of their total CCDF
funds for quality improvements and offer additional services to
parents.\8 CCDF funds subsidize child care through certificates that
parents can use to pay the child care providers they select.  Some
states also use contracts to fund slots in child care programs. 
Preliminary HHS data over the 6-month period January to June 1997
indicate that voucher use was fairly evenly split between home and
center settings.\9

Other HHS and Education programs also support child care and
education in various ways, sometimes with different program goals. 
For example, HHS's TANF program provided about $900 million for child
care in fiscal year 1999 to support parents in work activities.  In
addition, Social Services Block Grants (SSBG) is a flexible source of
funds that the states may use to support a wide variety of social
services, including child care.  In Education, the Even Start program
has adult literacy and parenting education, as well as early
childhood care and education for children through 8 as goals.  This
program is funded with $135 million and serves about 40,000 families. 
In addition, title I of the Elementary and Secondary Education Act
supports programs and services for educationally disadvantaged
children; funding for early childhood education is estimated to have
been about 12 percent, or $936 million, of the total $7.8 billion in
fiscal year 1999.  The Individuals with Disabilities Education Act
(IDEA), another Education program, has a Grants for Infants and
Families with Disabilities program.  Services such as speech therapy
are provided to assist the states in creating statewide systems of
programs to make available early intervention services to all
children with disabilities aged birth through 2 years old and their
families at home or in whatever early childhood care or education
setting children attend.  The IDEA Preschool Grants program provides
states with funding to enable children with disabilities to receive
special education and related services for preschool children. 
Finally, 21\st Century Community Learning Centers may support early
childhood care and education.  The $200 million program funds
school-community partnerships to keep schools open after school and
in summer as a safe haven for enhanced learning. 

--------------------
\6 In Head Start Programs:  Participant Characteristics, Services,
and Funding (GAO/HEHS-98-65), we reported that 93 percent of the
children were in part-day and part-year programs and 63 percent were
4 years old. 

\7 According to 1999 HHS guidelines, $13,880 per year for a family of
three is the federal poverty level for the 48 contiguous states and
the District of Columbia; the level is higher in Alaska and Hawaii. 

\8 Additional services to parents include services such as resource
and referral counseling regarding the selection of appropriate child
care.  In addition, for fiscal year 2000, the Congress has
established several earmarks above the 4 percent minimum quality
expenditure requirement--$173 million for quality activities, $50
million for improving the quality of infant and toddler care, and $19
million for child care resource and referral and school-age child
care activities. 

\9 Preliminary data on types of care being used by children
subsidized by block grants indicate that on average about 11 percent
of the children are cared for in home, 30 percent are with family
child care, 4 percent are with group homes, and 55 percent are using
centers. 

      MOST STATES FUND EARLY
      CHILDHOOD PROGRAMS
---------------------------------------------------------- Letter :3.2

Forty-three states, including the District of Columbia, reported that
in fiscal year 1999 they provided their own state funding, beyond the
amounts required to match federal contributions, to support early
childhood programs.\10 Table 2 provides information on funding and
enrollment in such programs. 

                          Table 2
          
             Types of Programs States Funded in
                      Fiscal Year 1999

                     Number of     Estimated     Number of
Type                  states\a       funding      children
----------------  ------------  ------------  ------------
Early childhood             32  $1.7 billion       613,000
 education
Child care                  19   1.7 billion       351,000
 program
 supplements
Head Start                  15   155 million        48,000
 supplements
----------------------------------------------------------
\a Some states supported more than one type of program, but in total
43 states had at least one. 

Thirty-two states reported funding preschool programs that generally
operated as part of the public school system.  Also, 15 states
provided funds to supplement the Head Start program by expanding it
to serve more children, by increasing teacher salaries, or by
providing transportation to Head Start facilities.  Finally, 19
states administered programs that helped fund child care for
communities by providing grants to communities to address their child
care needs.  These funds could be used in a variety of ways, such as
for preschools, for child care, to give providers training, and for
assistance in meeting licensing requirements.  Of the 43 states, 20
provided some funding for infant and toddler care, generally through
funds to communities.  The number of children served by state early
childhood care and education programs ranged from several hundred in
five states to nearly 140,000 in Texas. 

--------------------
\10 In order to draw down their federal allotments, the states must
meet a maintenance of effort requirement and contribute matching
funds.  We excluded programs funded by a state match and programs
with a limited eligibility, such as programs only for teenagers. 

      EDUCATION IS THE MOST
      FREQUENTLY PROVIDED SERVICE
---------------------------------------------------------- Letter :3.3

Resource and referral agencies reported in responding to our survey
that providers in home and center settings offered a range of
services, but educational programs in centers were by far the most
common, as shown in figure 1.  The proportion of providers offering
other services was much lower.  Generally, centers provided more
services than were provided in homes.  For instance, about 10 percent
of the resource and referral agency respondents stated that all or
most centers provided parental support services or medical referrals;
fewer agencies reported that all or most home care settings provided
these same services.  According to census data, about 70 percent of
low-income families met their child care needs in the home. 

   Figure 1:  Percentage of
   Providers That Offer Services
   as Reported by Resource and
   Referral Agencies

   (See figure in printed
   edition.)

Similarly, our survey of state child care administrators showed that
most state-funded programs offered educational services.  In
addition, most also offered parental support activities, meals for
the children enrolled, and referrals for medical services. 

   SOME TYPES OF CARE ARE
   DIFFICULT TO OBTAIN
------------------------------------------------------------ Letter :4

Although the federal and state governments support many programs for
early childhood care and education for low-income children, some
types of care such as infant and toddler care are still difficult to
obtain.  State child care administrators reported that the high cost
of care, its unavailability, and inaccessibility to providers were
significant barriers to low-income families in obtaining the types of
care they needed. 

Collectively, our surveys, which covered all states and many
communities across the country, showed that obtaining care for
infants and toddlers, for children with special needs, and during
certain hours posed the most difficulty for low-income families. 
Figure 2 shows the responses on the difficulty of obtaining different
types of care from the resource and referral agency survey; the
responses of the child care administrators identified similar
difficulties.  Our previous work, based on limited case studies, also
identified obtaining care as a problem for infants and toddlers.\11

Resource and referral survey responses, however, reported that care
for preschool children generally was not difficult to find.\12
Slightly more than half of child care administrators reported that
there was sufficient full-time care for preschoolers.  Respondents
provided additional comments on the difficulties in obtaining care. 
For example, they reported that finding one place that provided care
for children of different ages in the same family such as an infant
and a preschooler was difficult.  The need for infant care and care
during nonstandard hours may be particularly important for TANF
recipients.  According to a recent study, more than a quarter of
former welfare recipients and a similar proportion of low-income
mothers work night hours.\13

   Figure 2:  Percentage of
   Resource and Referral Agencies
   Reporting That Care Is
   Difficult or Very Difficult to
   Obtain

   (See figure in printed
   edition.)

Child care administrators reported that high cost is a barrier,
whether parents are seeking care for preschoolers or care for infants
and toddlers.  Care for infants and toddlers is generally more costly
than preschool care mainly because of the higher staff-to-child ratio
required.  The subsidy provided in states does not always cover the
cost of available care for infants and toddlers.  Resource and
referral agencies reported in our survey that about 80 percent of
their centers and 70 percent of their home care providers accepted
children with subsidies.  Smaller subsidies allow states to provide
subsidies to more families but can limit the families' ability to
find affordable care.  For example, officials in Colorado estimated
that the average child care assistance subsidy is just 62 percent of
the cost of quality care. 

More than half of the state child care administrators cited the
inaccessibility of care, often related to transportation
difficulties, as another major barrier to low-income families seeking
child care.  Transportation was especially problematic in rural
areas.  For preschool care, arrangements sometimes have to be made to
move children from a half-day educational program to a supplementary
care program for the rest of the day. 

--------------------
\11 See Welfare to Work:  Child Care Assistance Limited; Welfare
Reform May Expand Needs (GAO/HEHS-95-220), and GAO/HEHS-98-27. 

\12 Our survey does not reflect whether or not the care available is
considered quality care. 

\13 "Assessing the New Federalism:  An Urban Institute Program to
Assess Changing Social Policies," discussion paper, Urban Institute,
Washington, D.C., 1999. 

   COLLABORATION HAS POSITIVE
   OUTCOMES BUT BARRIERS REMAIN
------------------------------------------------------------ Letter :5

To address the difficulties in obtaining certain types of care,
states and localities are using collaborative initiatives to bring
together the different program authorities involved in funding and
providing care, with the goals of increasing the availability of
various types of care and enhancing the services provided.  However,
according to state officials, collaboration does not eliminate all
gaps in care, and collaborative initiatives are sometimes limited
because of barriers such as differing eligibility requirements. 

      STATES REPORTED THAT
      COLLABORATIVE INITIATIVES
      HAVE RESULTED IN POSITIVE
      OUTCOMES
---------------------------------------------------------- Letter :5.1

In Colorado, Ohio, North Carolina, and Oregon, collaborative efforts
combined state and federal funds from a variety of sources to
increase the availability of child care and education settings
available to low-income families.  Collaboration was usually
accomplished through interagency coalitions or organizations that
tried to fit together different care and education options to meet
communities' and parents' needs.  These states also offered
communities incentives to collaborate, either in the form of waivers
to state regulations or as additional funds.  Some of the efforts
were enhanced by Head Start collaboration grants to local grantees. 

         CHILD CARE AND EDUCATION
         COLLABORATIVE INITIATIVES
         IMPLEMENTED IN FOUR
         STATES
-------------------------------------------------------- Letter :5.1.1

In Colorado, the state legislature created the Community Consolidated
Child Care Pilot Program to encourage communities to design
consolidated programs of comprehensive early childhood care and
education services for children in low-income families aged 6 weeks
through 5 years old.  At a minimum, pilot communities were required
to consolidate funding from the Colorado Preschool Program, operated
under the authority of local school districts and child care money
administered by local boards of county commissioners, thereby
encouraging the education and child care systems to come together. 
Initially, the legislature provided no financial incentives to
encourage pilot counties to collaborate; however, in future years,
additional funds will be made available to enable the collaborations
to further increase child care availability. 

The Colorado legislature authorized the state Department of Human
Services to waive state laws or rules that would prevent the pilot
communities from implementing collaborative projects.  Waivers
included requiring only a single application for multiple programs
and broadening program eligibility to meet specific community needs. 
For example, two pilot counties raised the income eligibility level
for the state child care subsidy so that low-income working parents'
child care expenses would not increase substantially as their income
increased. 

North Carolina's Smart Start initiative provided state funds ($24.4
million in 1998) to assist communities in improving and expanding
their existing programs for children and families and in designing
and implementing new programs.  The primary goal of Smart Start is to
ensure that North Carolina's children enter school healthy and ready
to learn.  A prerequisite for the receipt of Smart Start funds is
that representatives from various community organizations must form
local partnerships for children to plan for and direct the
distribution of the funds to local service providers.  Initially
funding twelve partnerships, Smart Start partnerships now operate
throughout the state.  Local partnerships were funded both to
increase the availability of child care and to improve center or
provider quality. 

Created in 1992, Ohio's Family and Children First Initiative focuses
a diverse group of agencies and organizations on achieving better
outcomes for children and their families.  The goal is to promote
collaboration among state and local governments, nonprofit
organizations, businesses, and families to ensure that children are
ready to learn.  Its three key objectives are making infants
healthier, increasing access to quality preschool and child care, and
improving services for family stability.  The Early Childhood
Coordination Committee is charged with bringing Ohio's Head Start
program, Ohio's public preschool program, and its subsidized child
care program into a coordinated system of care.  At the county level,
the initiative has supported the funding and development of councils
composed of several child care organizations, including both child
care programs and education programs.  Each county council received a
$20,000 state grant for these collaboration activities.  Ohio also
provided $181 million in state funds to expand Head Start services to
more eligible families.  Further, by combining Head Start with CCDF
funds, the state has enabled children in poor working families to
receive a full day of care. 

In 1993, Oregon's legislature created the Commission on Children and
Families to support community-based planning and decisionmaking and
to encourage collaborative partnerships to change the state's system
of delivering services and develop supports for children and
families.  Local commissions were to include citizens, community
groups, businesses, service providers, and government.  In 1997, the
commission directed $58.4 million, primarily from state and federal
government sources, to the local commissions on children and families
in each of its 36 counties.  Collaboration among different programs
operating in the community was a prerequisite for receiving a grant. 

         HEAD START SUPPORT FOR
         COLLABORATION
-------------------------------------------------------- Letter :5.1.2

Collaborative efforts were also being fostered through federal
programs.  For example, in 1990, HHS began to award collaboration
grants to a few states to promote more integrated service delivery
systems and to encourage collaboration between Head Start and other
programs.  By 1997, all states were funded.  The Congress also
increased funding for Head Start for fiscal years 1998-99, in part to
increase enrollment numbers.  Recognizing that an increasing
proportion of Head Start families work and that many who receive
public assistance are participating in welfare reform initiatives in
response to TANF, HHS gave priority to funding more full-day,
full-year care.  Head Start encouraged programs to consider combining
Head Start expansion funds with other child care and early childhood
funding sources to deliver services through partnerships such as
community-based child care centers.  In addition, the 1998 amendments
encouraged collaboration and have resulted in a performance
indicator, the measure by which Head Start grantees are evaluated,
that indicates the extent to which a Head Start grantee is
collaborating with other community providers in providing linkages to
child care. 

         POSITIVE OUTCOMES
         REPORTED
-------------------------------------------------------- Letter :5.1.3

As a result of these initiatives, the states reported positive
outcomes in terms of increased child care and services.  Colorado
officials reported a larger increase in the number of children served
in pilot counties than elsewhere in the state.  For example,
according to the director of one pilot collaboration project, the
project's efforts have enabled it to increase child care by 61
percent and to essentially meet the need for care and education for
3- to 5-year-olds.  Similarly, Ohio reported that the collaboration
between state and federal Head Start and Ohio preschool and child
care programs has enabled Ohio to increase not only the amount of
care available to low-income children but also their access to Head
Start services.  The state reported that it currently serves 84
percent of its children who are eligible for Head Start in state or
federal Head Start programs, compared with a national average of 38
percent.  In North Carolina, an evaluation of the Smart Start program
reported a 12 percent increase in credentialed child care providers. 
Officials in one county credited Smart Start with a 25 percent
increase in the number of child care centers meeting the state's
highest standard for center-based care.  Likewise, state officials in
Oregon identified positive outcomes that have resulted from its
collaborative efforts, including increased numbers of preschool
programs, licensed providers, and home-based care for infants and
toddlers and the initiation of a career development program for
providers.  Oregon also reported that it increased the number of
group homes by 25 percent. 

      BARRIERS TO COLLABORATION
---------------------------------------------------------- Letter :5.2

Collaboration has, according to state officials, clearly resulted in
positive outcomes; however, barriers to collaboration still remain. 
State program administrators and resource and referral agency
respondents identified several barriers, including differing
eligibility requirements, "turf" issues or concerns that an
official's authority or power would be lessened, insufficient funds,
and lack of information on programs.  Program administrators said
that the differing eligibility requirements between Head Start and
CCDF made collaboration difficult.  Head Start's income eligibility
standard requires that 90 percent of enrollments be at or below the
federal poverty level, whereas CCDF funds may be used for families
with income up to 85 percent of state median income, which generally
allows the states to give subsidies to families who make more than
the federal poverty level.  Thus, collaboration between these
programs to achieve objectives, such as full day coverage, might be
difficult because some children may be eligible only for CCDF. 

In citing turf issues as barriers to collaboration, the respondents
expressed concern that officials' power or authority would be reduced
and that they would be unwilling to share program funds.  These
issues often reflected the division of child care organizations from
early childhood education organizations.  Child care programs were
generally administered through human services agencies, whereas
preschool education programs were generally administered by the
education departments and public school agencies.  One state official
said that with the separate funding, regulations, and goals, the
child care and education offices have not traditionally understood
the importance of each other's role in a child's development. 

Resource and referral agency and state administrator respondents also
frequently cited a lack of information on the various programs that
fund child care and education as a barrier to collaboration.  For
example, one respondent commented that a lack of understanding of the
different agencies' and organizations' policies and service delivery
hindered collaboration.  In one state, an official told us that the
people who work in child care do not know the requirements for
facilities and training that exist in the education department and
that are very different from theirs and vice versa. 

Respondents reported that insufficient funds also hindered their
ability to collaborate.  Lack of funding to support collaborative
initiatives was widely cited as a barrier, with respondents
specifically citing a lack of staff, training, and transportation as
hampering collaboration with other organizations. 

   CONCLUSIONS
------------------------------------------------------------ Letter :6

The implementation of TANF has put more low-income children in care
outside the home and put them in care earlier in their lives.  While
efforts to provide programs of care for preschool children appear to
generally meet the demand for such care, care for infants and
toddlers, care during nonstandard hours, and care for children who
have special needs are still not available, affordable, or
accessible.  As a result, these are the types of care most in need of
support.  Some states and localities have been using collaborative
initiatives to increase the number of full-day providers and to
enhance the quality of program services, and these have positively
addressed families' and children's needs.  The methods they have used
may be helpful to other states and localities as they attempt to
address their own needs. 

   AGENCY COMMENTS
------------------------------------------------------------ Letter :7

We provided Education and HHS with a draft of this report for their
review.  HHS responded with comments that are printed in appendix II. 
In its comments, HHS wrote that this report will be helpful as it
continues its efforts to work with states and communities to meet the
needs of low-income preschool children and their families.  HHS fully
supports our conclusions about the need for care for working
low-income families.  It provided additional information about the
types of care and the adequacy of the care it says is needed, as well
as descriptions of various initiatives to support collaborative
efforts to meet such needs. 

At our meeting with Education officials, including representatives
from different Education program offices, Education said that it
generally agrees with our findings and conclusions.  In addition,
Education provided us with information about its ongoing and planned
efforts to promote literacy and coordination with other programs. 
Where appropriate, we made technical changes that both departments
provided. 

---------------------------------------------------------- Letter :7.1

We are sending copies of this report to the Honorable Donna E. 
Shalala, Secretary of the Department of Health and Human Services;
the Honorable Richard W.  Riley, Secretary of the Department of
Education; and others who are interested.  We will also make copies
available to others upon request. 

If you or your staff have any questions about this report, please
contact me on (202) 512-7215.  Other staff who contributed to this
report are listed in appendix III. 

Cynthia M.  Fagnoni
Director, Education, Workforce, and
 Income Security Issues

SCOPE AND METHODOLOGY
=========================================================== Appendix I

This appendix contains detail on our surveys of state child care
administrators, state departments of education, and members of the
National Association of Child Care Resource and Referral Agencies as
well as our case studies in four states. 

SURVEY METHODOLOGY

We conducted two surveys to obtain information about activities at
the state level.  We sent questionnaires to the child care
administrators in all 50 states and the District of Columbia to get
information about the funds that states allocate for early childhood
programs, the source of the funds, the characteristics of
state-administered child care programs--including the types of care
and services they provided and their availability of
care--difficulties low-income families encounter finding care, how
the states attempt to gauge the adequacy of the supply of care, and
factors that foster or hinder collaboration among early childhood
programs.  We also sent questionnaires to the departments of
education in each state and the District of Columbia to get
information about state-administered early education programs.  Of
the 51 questionnaires we sent to the child care administrators, 50
were returned--a response rate of 98 percent.  Of the 51
questionnaires we sent to state departments of education, 49 were
returned--a response rate of 96 percent. 

Because limited information was available on services from most
federal programs, we surveyed resource and referral agencies which
have access to information on various types of care and services
provided through centers and home care providers because of their
role in referring low-income parents to potential child care
providers.  We used the membership list of the National Association
of Child Care Resource and Referral Agencies.  We sent a
questionnaire to each agency listed as a member of the association,
excluding 32 members that we sent to agencies that were not resource
and referral agencies or that were sublocations of larger resource
and referral agencies.  The response rate was 80 percent:  428 of the
537 questionnaires we sent were returned. 

According to early childhood care and education experts, a survey of
the NACCRRA members was most likely to yield credible local
perspectives on child care programs and an acceptable response rate. 
However, our survey should not be considered to be an overall measure
of child care services at the local level.  Some resource and
referral agencies are not NACCRRA members, and some child care
providers may not be registered with their local agencies.  According
to the association, about three-fourths of child care resource and
referral agencies are members. 

Our compilation of programs does not include every program with which
a state addresses early childhood issues.  We excluded from our
survey results any reported programs that did not use state or local
funds over and above those required by federal maintenance of effort
or matching requirements.  We also excluded funds and any reported
programs that did not serve children directly. 

CASE STUDIES

We developed in-depth information about early childhood programs,
particularly their collaboration efforts, in Colorado, Ohio, Oregon,
and North Carolina and two localities within each of those states. 
We chose states that the National Governors Association and others
considered to have integrated approaches to child care and
established frameworks for state action.  We also selected states to
get a mix of geographic regions.  We met with states' officials and
also visited at least one primarily urban jurisdiction and at least
one primarily rural jurisdiction.  We interviewed state officials in
the education and human services and social services departments.  We
talked with state officials responsible for preschool programs, early
childhood education, title I, the Individuals with Disabilities
Education Act, child care subsidies, and child care provider
licensing.  We also talked with officials of private and nonprofit
organizations involved in early childhood education or care issues. 
We reviewed documentation on these issues.  In the two localities we
visited in each state, we interviewed officials responsible for
similar programs and activities at the local level and reviewed
documentation about their programs. 

(See figure in printed edition.)Appendix II
COMMENTS FROM THE DEPARTMENT OF
HEALTH AND HUMAN SERVICES
=========================================================== Appendix I

(See figure in printed edition.)

(See figure in printed edition.)

(See figure in printed edition.)

(See figure in printed edition.)

GAO CONTACTS AND STAFF
ACKNOWLEDGMENTS
========================================================= Appendix III

GAO CONTACTS

Harriet Ganson, Assistant Director, (202) 512-9045
Mary Roy, Evaluator-in-Charge, (202) 512-7072

ACKNOWLEDGMENTS

In addition to the persons named above, Kopp Michelotti, Martha
Elbaum, Margaret Boeckman, and Kelly Mikelson contributed
significantly to this report. 

*** End of document. ***