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III The Current System

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6 Child Care Services Although many working parents continue to care for their children themselves or to rely on relatives, nannies, and babysitters to provide care at home, many others have turned to caregivers in settings outside the home. These include day care centers, operated on a for-profit or a not-for profit basis; family day care homes and group homes; public and private nursery schools, prekindergartens, and kindergartens, operated as part-day or full-day school programs; before- and after-school programs; and Head Start programs. There have been striking changes among these care arrangements in the past three decades; see Figure 6-1. Although data on the supply of child care services are largely inadequate because of the broad range of providers and auspices and the lack of systematic collection of information at the national or state level, there is evidence that the supply of out-of-home services has increased substantially since the 1970s (Kahn and Kamerman, 1987~. The most striking characteristic of the existing system of out-of-home child care is its diversity. Like other social services, child care services have not developed within any designed framework of regulations, policy, or legislation. States vary in their commitment to developing, funding, and regulating care, and this variation increases at the community level. The resulting "patchwork quilt" is an amalgam of individual and institutional child care providers (Siegel and Lawrence, 1984~; the individual programs do not perceive themselves as interrelated or as sharing a common set of goals. The need for some coordination and regulation of child care services has been widely recognized for some time, and the debate over which jurisdiction should regulate, what should be regulated, to what extent, with 147

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148 30 ~ 1958 Eli 1965 25 ~ =1 1977 Em 1982 20 Lo 15 Lo to 10 5 o WHO CARES FOR AMERICA'S CHILDREN? ~ 1984-1 985 _. _~_ ~\ ~Axon ~ <~\~0~ GO to CARE ARRANGEMENT FIGURE 6-1 Child care arrangements for children, under age 5 of full-time employed mothers, 1958-1985. Source: Data from Bureau of the Census (1987~; Lueck et al. (19823; O'Connell and Rogers (1983~. what exceptions, and with what types of enforcement and sanctions is an old one. After more than a decade of legislative and regulatory battles at the national level, the Federal Interagency Day Care Requirements were eliminated in 1982, and states are now responsible for the regulation of child care services. Since the early 1980s, the debate at the state and local levels has focused on ways to improve consumer knowledge and standards for protection as well as government monitoring and enforcement. In general, regulations have gradually become more stringent during the past decade and a half, although states vary dramatically in their specific provisions (see Appendix A). Moreover, within this context, different types of programs are governed by different regulatory authorities, and some providers are exempt because of the auspices under which they operate or the number of children they serve. In this chapter we review what is known about the delivery and reg- ulation of child care services and some barriers to effective services. In Chapter 4 we discussed the role of regulation as it affects the quality of care that is provided by different types of programs and arrangements; in this chapter we consider the ways in which regulation and the regulatory environment affect the delivery of child care services. It is important to note at the outset, however, that our knowledge is limited. Information concerning the supply of child care services is not systematically reported, and few programs have been rigorously evaluated. As a result, information

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CHILD CARE SERVICES 149 about program effects must be cumulated from the growing body of small- scale child care studies that provide some insights into how various delivery approaches work, for whom, under what circumstances, at what costs, and with what intended and unintended consequences, but that generally lack comparability in their design and methods. CHILD CARE SERVICES Care by Relatives Many parents provide care for their own children by working split shifts or other flexible arrangements. A total of 3.7 million children under age 15 whose mothers are in the labor force are cared for exclusively by their parents (Bureau of the Census, 1987~. Grandparents, siblings, and other extended family members continue to be important sources of care, especially for infants and toddlers, and to supplement school and school- based programs: approximately 3.1 million children under age 15 are cared for by relatives in their own homes or in the relative's home (Bureau of the Census, 1987~. Together, these 4.8 million children constitute more than 20 percent of all children under age 15 who receive supplemental care. But relative care is declining for all children because many grandmothers and aunts who once were available to serve as caregivers are now employed (Bruno, 1987~. As discussed in Chapter 2, parents who work evening or night shifts and those who work part time appear to be more likely to rely on relatives to care for their children than those who work regular day shifts, especially if they work full time. In two-parent families, the caregiver is often the father. The direction of the relationship between shift work and the use of relative care is not known, however: it is unclear if families who choose to rely on relatives (including fathers) as caregivers choose to work evening and night shifts or, if having chosen or having been assigned to irregular shifts, they must rely on relatives in the absence of other types of care (Presser, 1986~. Child care provided by parents and other relatives is unregulated whether it occurs in the child's own home or in the relative's home. Only when an adult cares for a related child along with other children in a child care center or a regulated family day care home are these services subject to state or local government monitoring and enforcement. Data concerning the incidence of relative care come from the Current Population Surveys (CPS), the Survey of Income and Program Participation (SIPP), the National Survey of Family Growth (NSFG), and the youth cohort of the National Longitudinal Survey. These sources provide information concern- ing trends in reliance on relative care, but they do not provide information about the relatives who serve as caregivers, for example, whether they

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150 WHO CARES FOR AMERICA'S CHILDREN? provide care for other children, including their own, in addition to the relative child. Nor is there any information about their qualifications or the amount, if anything, they are paid for their services. There is also no reliable information on their longevity as caregivers. Nannies and In-Home Babysitters There is similarly little systematic information on nannies, babysit- ters, and other unrelated caregivers who care for children in the child's own homes. Data from the NSFG suggest that approximately 1 million children were cared for in this way in 1982; 1985 SIPP data showed that approximately 687,000 (2.6 percent) of children under age 15 who received supplemental care were cared for in their own homes by an unrelated adult. If these data are comparable, there has been a decline of approximately 31 percent in the use of in-home care in just 3 years. Because so little is known about this form of care, it is difficult to speculate about reasons for the decline. It may reflect in part the growth in out-of-home care alternatives. In addition, as Hofferth and Phillips (1987) point out, recent migrants have often served in this role. As immigration patterns and laws have changed, and as women who have been in this country for some time accumulate labor market experience, their likelihood of becoming child care providers in someone else's home will probably continue to decline. Like relative care, in-home care provided by nannies, babysitters, and other unrelated caregivers is unregulated. Nanny placement agencies, which have sprung up in recent years in many large metropolitan cities across the country, provide some anecdotal information on women who serve as in-home caregivers. Many are young, in their late teens and early 20s, from small communities in the Midwest and far West who want to have the experience of living and working in a large city. Some are black women living in urban centers. Others are immigrant women from Central America, the Pacific Islands, and the Caribbean, newly arrived in this country and often illegal aliens. A few are Europeans on short-term visas who have come as a part of an au pair or living-abroad program. Some have professional training and experience; many do not. Some live on their own; many live in the homes of their employers. Many in-home caregivers combine child care responsibilities with some housekeeping duties. Although salaries vary dramatically, recent information from Washington, D.C., suggests that the range is $150 to $350 per week, depending on hours of work, specific duties, and benefits (Granat, 1988~.

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CHILD CARE SERVICES 151 Family Day Care Although there are no reliable data on the number of family day care homes or the number of children in those homes, this form of care clearly represents a significant portion of the supply of child care ser- vices in the United States in the late 1980s. Since many family day care providers operate in the underground economy, however, precise estimates of their numbers and the number of children they serve are illusive. In the 1977-1978 Family Day Care Home Study, the U.S. Department of Health and Human Services estimated that 1.8 million unregulated providers and 115,000 licensed or regulated providers were caring for 5 million children and that approximately 23 percent of these children were of school age (Fosburg, 1981~. Adams (1982) reported that a 1982 telephone survey of all states and territories found 137,865 licensed, registered, or certified family day care homes. A 1988 survey of the states and Washington, D.C., undertaken as a part this panel's study, showed 198,257 licensed family day care homes nationwide (see Figure 6-2~. Estimates of unregulated care cited in congressional testimony and elsewhere range from 60 to 90 percent of the total supply, suggesting that there may now be between 496,000 and 1,983,000 such homes in the United States. Estimates of the number of children cared for in family day care homes are similarly wide. The Family Day Care Home Study reported an average of 3.5 children per home (excluding the caregiver's own children), with a range of 2 to 6 children per home (Fosburg, 1981~. Average enrollments varied according to the regulatory status of the home: sponsored homes (those in a network, which may or may not be regulated) averaged 4.3 children; regulated homes averaged 4.0 children, and unregulated homes averaged 2.8 children. Using the average of 3.7 children per home suggests that there may be as few as 1.8 million or as many as 7.3 million children, including school-age children, in family day care. Using an average of 3.5 children per house, Kahn and Kamerman (1987) point out that the total 5.0 million estimate that is widely quoted could be correct. However, Kahn and Kamerman (1987), using NSFG data, estimate 5.1 million children in family day care. An increasing number of states treat large family day care homes or group homes as a separate category for regulatory purposes. Epically these providers serve between 7 and 12 children (although some include larger groups). The number of large family day care or group homes appears to be expanding rapidly, from 2,371 in 1985 to 5,373 in 1988, according to survey data collected by the panel. Data from the CPS and the NSFG show that the highest rate of use of family day care is for very young children (HoRerth and Phillips, 1987~. In 1982, approximately 10 percent of children in family day care homes

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152 WHO CARES FOR AMERICA'S CHILDREN? 250 200 cn Is ~ 1 50 s - ._ - ~ 100 m he 50 o ...... :-:.:.:.:-:- :-:-:-:-:-: .~ : :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-:-:- :-:-:-:---: :.:.:.:.:.:.:. .:.:.:.:---: :-:-:-:-:-:-:- . .~ :-:-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-: :-:-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:---:- :-:-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-: :-:-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-: :-:-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-:-: :-:-:-:-:-: ....... _ 1977- 1 982 1978 ...... .:::. ~ ~ .~ :-:-: :-:-:-:-:-:-: :-:-: :-:- .-.-.-.-...... :-:-:-:-:-: :-:-:-:-:-:- :-:-:-:-:-- .:.-.:--.:-. :-:-.-:-:~ :-:-:-:-::: ............. :-.-:-:-:-:-: :.:.:.:.:.:.: :-:-.-:~: .: :-:-:-:-:-:- :-:-:-:-:-.-: :-:-:-:-:-: .. :.: :~:. :-:-:-:-:-:- :-:-:-:-:-: :-:-:-:-:-: ............ :-:-:-:-:-:- :-:-:-:~ :-:-:-:-:-:- :-:-.-:-:-: ............ :-:---:-:-:- :-:-:-:-:-: ............ :-:-.-:-:-:- :-:-:-:-:-: ............ :-:-:-:-:-: :-:-:-:-:-: :-:-:-: ..... 1 988 YEAR FIGURE 6-2 Regulated family day care homes, 1777-1978, 1982, 1988. Source: Data from Adams (1982~; Fosburg (1981~; unpublished panel survey. were infants, 26 percent were toddlers, 27 percent were preschoolers, and about 36 percent were of school age (unpublished tabulations from the 1982 NSFG). Although these measures are rough, they suggest that the percentage of toddlers in family day care has declined somewhat since 1977 and the percentage of school-age children receiving care before and after school hours and on school holidays has increased (Fosburg, 1981; Hofferth and Phillips, 1987~. Family day care is not a monolithic service. It differs greatly from provider to provider and from community to community. In general, however, family day care providers fall into one of three broad categories (Fosburg, 1981~. The first is young white mothers in their late 20s and 30s with their own young children at home. Many of these women left the paid labor force when they became mothers, and they provide care to other children as a means of supplementing their family income while at home. Although their income is still low by general standards, these women have relatively higher incomes than those in the other groups. Many of them

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CHILD CARE SERVICES 153 resume employment outside their homes when their own children are of school age or when they no longer require care. The second group comprises women in their 40s and 50s who care for at least one related child, often a grandchild. Like the younger women in the first category, they often decide to take on the care of other unrelated children as a means of earning some money while they are staying home with their relative's child. It is not uncommon for them to close down their family day care services when the related child no longer requires care. Many black or Hispanic caregivers fall into this group. The last group includes women in their 30s to 50s who care only for unrelated children. They may have begun providing child care when they were caring for their own young children and then developed their services into a business and a career. These providers are more likely to have had some professional training in child development and child care, and they are more likely to be regulated and sponsored than are providers in the first two groups. They also tend to stay in the family day care market for more sustained periods of time than the others. Overall, however, three-quarters of family day care providers describe this as a permanent role (Fosburg, 1981~. Family day care is distinguished by small group size (typically 6 or fewer children) and generally mixed-age groups (including school-age youngsters during before- and after-school hours), although some providers care only for infants and toddlers or only for preschoolers. Despite variation in the ages of children in their charge, however, family day care providers are unlikely to care for children whose race or ethnicity is different than their own. The National Day Care Home Study found that 80 percent of children in family day care are the same race and ethnicity as the caregiver (Fosburg, 1981~. Consumer surveys indicate that among parents who prefer family day care, it is the intimacy of a small group and a home environment as well as a sense of shared values with the caregiver that are important (Leibowitz et al., 1988~. Parents frequently live in close proximity to their family day care providers and, especially black or Hispanic parents, are of similar economic backgrounds (Waite et al., 1988~. Several researchers emphasize the close relationships that often develop between providers and children and between providers and parents. These adult relationships are frequently more informal and social than between parents and caregivers in other settings, and they are thought to enhance communications and interactions that can positively affect the child. In 1988, 27 states required some form of licensing for family day care providers depending on the numbers of children in their care. Twenty-three states did not have any formal licensing requirements, although 13 required

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154 WHO CARES FOR AMERICA'S CHILDREN? Or offered voluntary registration, and 6 states had an approval or a certifi- cation procedure for providers seeking to receive federal funds (Blank and WiLkins, 1985; Morgan, 1987; unpublished data from panel survey). Some states exempted homes serving fewer than four children. Despite the ens- tence of licensing requirements and registration or certification provisions, few family day care providers appear to operate under them. Fosburg (1981) found that in three cities in states with regulations, 94 percent of providers were operating informally and independently; another 3 percent were independent and licensed or registered, meeting state regulations (and federal standards governing the Child Care Food Program); and another 3 percent were regulated and a part of a family day care network, under the auspices of a sponsoring agency. In a recent study of the Child Care Food Program, Glantz and colleagues (1988) estimated that approximately 70 percent of family day care providers are unlicensed. Despite recent efforts in many states to register family day care providers (as opposed to licensing them) and to bring them into organized systems, there is consensus that the vast majority are still unregistered and unregulated (Kahn and Kamerman, 1987~. The reasons are not clearly un- derstood. Undoubtedly, some providers regard themselves as temporarily caring for the children of relatives and neighbors while raising their own children, and they may be unaware of the requirements or may regard the licensing process as too complex and costly to negotiate. Others may re- gard licensing as an intrusion, especially if they have no interest in seeking government subsidies. Still others may be hoping to avoid the tax liabil- ities or lost welfare benefits and transfers that would result from having to report their income (Kahn and Kamerman, 1987; Morgan, 1980~. The primary incentives for becoming licensed or registered appear to be public subsidies, such as the Child Care Food Program and funds for serving chil- dren in low-income families, referrals from resource and referral agencies and public social service agencies, as well as the ability to obtain liability insurance. Providers who see their activities as a business or a career are frequently more eager to gain the visibility that licensing and registration may bring. Kahn and Kamerman (1987) report that 94 percent of family day care is carried out through "largely invisible and unprotected" cash transactions; generally, reliable cost data are lacking. Fosburg (1981) found early in the 1980s that sponsored and regulated care was more expensive than unregulated care; see Bible 6-1. In more recent estimates of the costs of family day care in selected cities, Work/Family Directions, Inc., found a wide range within and across 15 cities; see Table 6-2. On the whole, family day care is slightly less expensive than center care, and unregulated family day care is least expensive of all. Kahn and Kamerman (1987) note that independent, unregulated providers rely solely on market fees and

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CHILD CARE SERVICES TABLE 6-1 Average Weekly Fee per Child by Type of Family Day Care Home and Race of Provider Race of Type of Care Provider Sponsored Regulated Unregulated White $31.80 $23.68 $19.70 Black 24.68 21.61 16.57 Hispanic 24.49 21.42 16.54 Average 6.36 22.65 17.80 Source: Data from Fosburg (1981:96~. TABLE 6-2 Weekly Child Care Rates for Family Day Care in 15 Cities, August 1987 Preschool-Age City Infants Toddlers Children Atlanta, Ga. $35-150 $45-70 $45-70 Boston, Mass. 150 95-125 80-105 Chicago, Ill. 60-100 65-85 50-80 Cleveland, Ohio 25-100 25-100 25-100 Denver, Colo. 60-100 455-95 55-95 Greenville, S.C. 35-60 35-60 35-60 Los Angeles, Calif. 44-88 44-88 38-84 Miami, Eta. 25-75 25-65 20-65 Minneapolis, Minn. 70-90 60-75 50-65 New Orleans, La. 30~5 30~5 30~5 New York, N.Y. 35-150 35-150 35-150 Oklahoma City, Okla. 35-60 40-80 40-65 Raleigh, N.C. 25-125 25-85 25-85 Seattle, Wash. 46-58 69 69 Washington, D.C. 35-125 35-125 35-100 Source: Unpublished data from Work/Family Directions, Inc. 155 therefore both charge and earn somewhat less than sponsored and regulated providers. Those that are a part of a network or are agency sponsored are more likely to have their services partially or completely subsidized by public funds, including the Child Care Food Program. Indeed, the cost differences between sponsored or regulated family day care and center care are generally modest. As a result, these caregivers are more likely to earn somewhat higher wages (Kahn and Kamerman, 1987~.

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CHILD CARE SERVICES 183 has not been an analogous increase in licensing staff. In addition, licensing personnel are under great pressure to interpret a myriad of regulations that may have been drafted to allow flexibility but in fact create confusion. Individual regulations may use such words as "adequate" or "sufficient" very differently and, therefore, subject similar programs to very different standards. A major question that remains largely unanswered is the effect of regulations on the supply of child care services. Do stringent regulations drive some providers out of the market or discourage others from entering? Do they significantly raise the costs of care, and if so, who bears these additional costs? Do they affect the quality of care that is provided? There is no shortage of opinion on these matters, but there is little convincing evidence. Many observers conclude that the elimination of the Federal Interagency Day Care Requirements in 1981 led some large commercial chains to expand their operations in the southern states where there is less stringent regulation of child care. Low standards, particularly as they apply to staff qualifications and to staff/child ratios, allow providers to reduce staff costs and enhance profitability. At the same time, however, relatively lower real estate costs in the South have meant lower capital expenditures for providers developing facilities. Hence, it is difficult to determine the extent to which regulation has actually affected the supply of center care. Critics of state licensing and registration requirements insist that they increase the costs of providing services, "driving providers underground and limiting the number of children who can benefit" (Lehrman and Pace, 1985:1~. This has been a special concern with regard to family day care homes. Although there are no definitive data that show that providers have closed or closed and then reopened as unlicensed facilities-data from state licensing offices indicate that in states with more stringent regulations and registration requirements, there are relatively fewer licensed family day care providers and fewer licensed spaces for children (data from panel survey). I~enty-seven states require some form of licensing or registration for family day care providers, depending on the number of children in the home; 13 states require or offer voluntary registration, again depending on the number of children in the home; 4 states combine these two mechanisms; and 6 states have an approval or certification procedure if a provider receives federal funds (Morgan, 1987; data from panel survey). As Kahn and Kamerman (1987) indicate, most child care experts agree that for the most part this licensing or registration does not constitute an accountability or monitoring system. Some experts worry that this lack of accountability may be a problem; others believe there is no way to effectively regulate all family day care.

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184 WHO CARES FOR AMERICA'S CHILDREN? The registration and certification systems may provide positive incen- tives for some family day care providers to come into the regulated system, by offering referrals, training and technical assistance, and help in obtain- ing federal subsidies, especially through the Child Care Food Program. Evidence concerning the growth of family day care networks suggests that this incentive may be operating in many states, even those with stringent regulatory policies. And advocates from many points on the political spec- trum have supported such incentive (rather than punishment) approaches to promoting the adoption of performance standards in family day care homes. ~ date, there has been no analysis of the effects of registration or certification on the quality of child care services or on developmental outcomes among children in family day care. The National Day Care Home Study in the late 1970s did show that regulation and sponsorship were associated with many of the characteristics that are desirable in family day care settings (Fosburg, 1981~. Building and Zoning Restrictions In many communities, restrictions on local land use, building, and zoning have become barriers to the development of child care programs and facilities centers as well as family day care homes whether operated on a for-profit or not-for-profit basis.1 Local ordinances that affect child care services include zoning and land use laws, building codes, and deed restrictions. The use of these types of provisions to restrict the location and operation of child care services has two different origins. In many communities, concerns about the effects of child care facilities on the character of neighborhoods, noise levels, property values, traffic, and the like have led citizens' groups to invoke such provisions as a means of discouraging or opposing the establishment of centers and family day care homes. Those provisions have also been invoked by child care activists to try to ensure the basic health and safety of children in out-of-home care, using restrictive local building and land use provisions as means of compensation for lax state licensing and enforcement. In states with lenient regulations on group size and staff/child ratios, for example, proponents of regulation have used local zoning and building restrictions to create barriers to the establishment of programs that are of poor quality in other dimensions. Although there are no national data available, experience suggests that local restrictions have in many cases limited the development of licensed child care services. 11he information in this section comes largely from the Child Care Advocapy Center in San Francisco (Abby Cohen, personal communication, May 23, 1988~.

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CHILD CARE SERVICES 185 Zoning and land use laws have been used to exclude child care ser- vices, especially family day care homes, from residential neighborhoods, where ironically they are by definition intended to operate in many states. Opposition has been greatest toward large family day care or group homes, which serve as many as 12 to 15 children. Some communities have invoked occupation ordinances, which limit the use of space (especially outdoor space), restrict hiring home employees for child care purposes (other than to care only for the occupant's children), or prohibit operating any kind of business in the home. In addition, by establishing impossible condi- tions (e.g., requiring 10-foot masonry walls around the residential property, costly use permits, conditional use permit hearings), child care services are excluded de facto whether or not local ordinances explicitly prohibit operations. Building codes have similarly been used to restrict child care services in commercial spaces and residential areas. Specific requirements concerning the configuration of indoor and outdoor space, building permits, and the use of materials have stymied many commercial developers willing to establish child care centers in new office complexes and proprietary providers building their own new facilities (Claudia Ostrander, Maryland National Bank, personal communication, May 23, 1988~. They have also affected family day care providers who adapt residential spaces for child care. It is not uncommon for building codes and fire codes to be contradictory, which creates impossible problems for providers and takes months or even years to resolve through administrative and judicial processes. In addition to local public ordinances that limit use and set conditions concerning the configuration of space, deed restrictions have been adopted in many developments, condominiums, and cooperative properties. These private agreements limit the rights of property owners to acquire, own, use, or dispose of their property, and, increasingly, they are being used in subur- ban condominium and townhouse developments to exclude family day care providers. Even if providers become licensed, homeowners' associations can force them to close down. One way to overcome such barriers is through state preemption laws. Approximately 10 states have passed legislation prohibiting local zoning officials and private homeowners' agreements from excluding family day care. In most cases, these laws specify that family day care Is a permit- ted residential use requiring no further approval. Preemption laws have helped to alleviate, and In some cases overrule, local building and zoning restrictions, but they also present problems. For example, because there are no uniform definitions of family day care from state to state and even from locality to locality, questions often arise as to whether the service in question is a family day care home or a group home and, therefore, which

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186 WHO CARES FOR AMERICA'S CHILDREN? provisions do or do not apply. In addition, in suspending deed restric- tions, preemption laws may affect the ability of commercial developers and homeowners' associations to obtain liability insurance for common areas. Local ordinances vary, and even within the same community they may be inconsistently applied. The enforcement of building and zoning restrictions has had a disproportionate impact on providers in low-income neighborhoods. Public housing frequently restricts its use for business purposes. Lacking the resources to meet building and fire provisions, providers may either shut down or operate illegally, thus limiting the supply of licensed child care in communities where it is needed. Liability Insurance In the early 1980s, economic hardship in the insurance industry cou- pled with wide media attention to several cases of alleged sexual abuse in child care centers led many insurance companies, fearful of their po- tential liability, to significantly increase premium rates to providers or to discontinue coverage for child care operators. A national survey of cen- ters and licensed family day care homes in 1985 revealed that more than two-thirds of providers had experienced policy cancellations, nonrenewals, reductions in coverage, or large rate increases. Rate increases averaged ap- proximately 300 percent (Strickland and Neugebauer, 1985~. These results were corroborated by several state-level surveys (Phillips and Zigler, 1987~. Although there is disagreement about whether claims records justified these actions, by the mid-1980s child care was regarded as a high-risk business by insurance actuaries (U.S. House of Representatives, 1985~. In congressional hearings, insurance industry representatives cited inadequate regulation and monitoring as a fundamental concern and indicated that companies that continued to write policies during this period applied their own "loss" standards (Phillips and Zigler, 1987; U.S. House of Repre- sentatives, 1985~. These standards varied by company but in most cases were more stringent than applicable state licensing standards on matters of stafI/child ratios, employee screening, and staff supervision (Phillips, 1986~. Over the past few years, as the financial health of the insurance industry has improved and as publicity about sensational cases of alleged child abuse has subsided, some companies have resumed writing liability coverage for child care providers, particularly for centers. Premiums vary on the basis of a number of factors, including building structure, program size, and perceived safety factors. Together with the National Association for the Education of Young Children (NAEYC), for example, Cigna has begun to offer coverage to centers that meet NAEYC credentialing criteria. In 1988 approximately 3,500 centers nationwide were covered by this policy, which provides package coverage for the building and its contents, liability,

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CHILD CARE SERVICES 187 worker's compensation, and transportation liability. (Plans are currently under way to develop a similar program for family day care homes.) Independent insurance brokers report that in 1986, the first year that the program was in operation, it was so profitable that Cigna paid a 7.1 percent dividend back to the insured; in 1987 Cigna paid back a 23.4 percent dividend (William Ashton, Forest T. Jones & Co., personal communication, May 23, 1988~. An important policy issue, however, is the extent to which the high costs or unavailability of liability insurance may have forced providers to shut down or to operate without coverage. Unfortunately, there are no definitive data on this issue. In 1988 24 states required insurance coverage for child care centers and 7 required coverage for family day care homes (unpublished data from panel survey). Therefore, it seems likely that if the liability insurance crisis of the mid-1980s had an impact, it was more likely to have been felt by child care centers than family day care homes. There is a widespread perception that many family day care providers operate with no special coverage other than a regular homeowner's policy (if that). Strickland and Neugebauer (1985) concluded that very few centers or family day care homes shut down as a direct result of actions by the insurance industry. Moreover, the success of programs such as that offered through NAEYC may help to alleviate the problem of obtaining insurance for centers and family day care homes that meet set performance standards. Coordination and Planning As we have described throughout this chapter, the child care system in the United States is characterized by diversity by different types of programs, providers, and institutional auspices that represent different pro- fessional and economic interests. In the absence of a strong national child care policy, child care services have grown haphazardly, in response to an array of perceived needs at the community level, with partial and frag- mented leadership from the states and the federal government. Child care providers and advocates speak with many voices and inevitably represent a range of interests and perspectives that are as likely to be competing as coordinating. As a result, planning and coordination are unusual at every level. Because the federal government reduced its role in the provision, financing, and regulation of child care during the 1980s, there has been no focal point, either in Congress or in the executive branch, for child care issues. Child care and early childhood education are reasonably the concerns of numerous committees in both houses of Congress, and hearings on pending legislation have been held over the past 2 years by nearly all of them. Within the executive branch, no single agency or department has responsibility for

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188 WHO CARES FOR AMERICA'S CHILDREN? establishing policy, setting priorities, or facilitating coordination on child care issues. With a couple of exceptions, the same has been true of the states. A1- though many have passed legislation for funding early childhood programs through the schools, licensing and registering centers and family day care homes, subsidizing care for children from low-income families and those with special needs, and developing resource and referral services, few have effectively developed mechanisms for planning and coordination among these separate initiatives. The two notable exceptions are Massachusetts and California. In Massachusetts, the Office of Human Resources works across departments and provides a focal point for the range of state pro- grams and initiatives. On the basis of a 1983 planning report by the Department of Social Services and a 1984 report by the Governor's Day Care Partnership, a statewide advisory group was established, the state- level administrative capacity was upgraded, and priorities were established for future policy and program development. Among those priorities were a significant increase in child care funding through the social service sys- tem, a commitment to statewide resource and referral coverage, a pilot grant program to assist school districts in establishing programs for 3- and 4year-olds, a corporate child care program to assist employers, and a voucher program (Commonwealth of Massachusetts, 1985; Massachusetts Department of Social Services, 1983; Catherine Dunham, Massachusetts Governor's Office, personal communication, Nov. 3, 1987~. In many ways, California served as the model for actions in Mas- sachusetts. California has the highest state budget for child care services and the longest history of involvement and leadership on child care. The Governor's Advisory Committee on Child Development Programs has lob- bied effectively for funding, advocated specific policies, and kept child care issues visible in the state. In addition to its strong support for the develop- ment of school-based programs, resource and referral services, vouchers for subsidizing care for low-income families, and a self-insurance program (ad- ministered through the Department of Education), the state has provided support and incentives for planning and coordination at the local level. These efforts have effectively involved corporations, and in turn, their re- sources have been mobilized in a systematic way to join local government in increasing and improving the child care supply. In the San Francisco Bay area, Bank of America raised over $2 million from local corporations and helped establish a "supply development" project for six pilot sites. The state's well-developed system of resource and referral services has provided the administrative core for assessing supply and demand at the local level and for facilitating the coordination of resources at the municipal and county level. As a result, child care has become a municipal political issue in many California communities (Kahn and Kamerman, 1987~.

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CHILD CARE SERVICES 189 At the local level, there are other scattered models of efforts to ef- fectively link public and private resources and to coordinate the activities of different providers and institutional organizations. In Minneapolis and St. Paul, Minnesota, two strong and effective organizations were formed in the mid-1980s to address the child care issue- the Greater Minneapolis Day Care Association and the Resources for Child Caring. These organi- zations often collaborate to improve child care services in the twin cities. Minneapolis and St. Paul have long traditions of effective human services delivery and of the public and private sectors working together to address local social service needs. These two organizations have involved schools, social services agencies, family day care networks, parent consumer groups, and local corporations to expand child care and Head Start. Much of their programmatic activity resembles initiatives in California cities and counties, combining community organizing and advocacy with resource and referral and technical assistance to local child care centers and prospective family day care providers. In contrast to the California experience, where local initiatives grew out of a strong state structure, however, the developments In Minneapolis and St. Paul have led the way for new Initiatives at the state level. These initiatives provide a great deal of encouragement that the dif- ferences between programs, providers, and institutions can be bridged, but they are by no means the rule In states and communities across the country. Clearly they depend on both political will and the creation of an ~nfrastruc- ture at state and local levels to plan and coordinate, to create networks, to allocate resources, and to cover gaps in the existing array of service delivery components. In the few states and local areas where planning and coordination have occurred, there has been an increase In the supply of child care and a more efficient allocation of funds. REFERENCES Adams, D. 1982 Summary of Findings: National Survey of Family Day Care Regulation. Chapel Hill, N.C.: Bush Institute for Child and Family Policy. Almy, M. 1982 Day care and early childhood education. In E. Zigler and E. Gordon, eds., Day Care Scientific and Social Policy. Boston, Mass.: Auburn House. Blank, H., and ~ Wilkins 1985 Child Care: Whose Priority? A State Child Care Fact Book. Washington, D.C.: Children's Defense Fund. 1986 State Child Care Fact Book 1986. Washington D.C.: Children's Defense Fund. Bruno, R. 1987 After School Care of School Age Children. December 1984. Current Population Reports, Series P-23, No. 149, Bureau of the Census. Washington D.C.: U.S. Department of Commerce.

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190 WHO CARES FOR AMERICA'S CHILDREN? Bureau of the Census 1987 Who's Minding the Kids? Current Population Reports, Series P-70, No. 9. Washington, D.C.: U.S. Department of Commerce. Bureau of Labor Statistics 1988 BLS reports on employer child care practices. News (January). Washington, D.C.: U.S. Department of Labor. Bureau of National Affairs 1984 Employers and Child Care: Development of a New Employee Benefit. Washington, D.C.: Bureau of National Affairs. Burud, S., P. Aschbacher, and J. McCroskey 1984 Employer Supported Child Care: Investing in Human Resources. Boston, Mass.: Auburn House. Caldwell, B. 1971 A timid grant grows bolder. Saturday Review 54(February 20~:47-49, 65-66. Coelen, C., F. Glantz, and D. Calore 1979 Day Care Centers in the US.: A National Profile, 197~1977. Cambridge, Mass.: Abt Associates. Commonwealth of Massachusetts 1985 Final Report of the Governor's Day Care Partnership Project. Boston, Mass.: Executive Department. Fosburg, S. 1981 Family Day Care in the United States. Summary of Findings. DHHS Publ. No. 80-30282. Washington D.C.: U.S. Department of Health and Human Resources. Friedman, D. 1985 Corporate Financial Assistance for Child Care. Research Bulletin No. 177. New York: The Conference Board. 1988 Estimates from the Conference Board and Other Monitors of Employer Sup- ported Child Care. Unpublished memo. The Conference Board, New York. Gannett, E. 1985 State Initiatives on School Age Child Care. Unpublished paper. School Age Child Care Project, Wellesley, Mass. Glantz, F., J. Layzer, and M. Battaglia 1988 Study of the Child Care Food Prowar Final Report. Cambridge, Mass.: Abt Associates. Gnezda, T., and S. Robinson 1986 State approaches to early childhood education. State Legislature Report 11~14~. Denver, Colo.: National Conference of State Legislatures. Goodman, I., and J. Brady 1988 The Challenge of Coordination: Head Starts Relationship to State-Funded Preschool Initiatives. Newton, Mass.: Education Development Center, Inc. Goodman, I., J. Brady, and B. Desch 1988 A Commitment to Quality: The Impact of State Supplemental Funds on Mas- sachusetts Head Start. Newton, Mass.: Education Development Center, Inc. Granat, D. 1988 Are you my mommy? Washingtonian 24~1~:164-201. Grubb, W.N. 1987 Young Children Fare the States: Issues and Options for Early Childhood Programs. New Brunswick, N.J.: Center for Policy Research in Education. 1988 Choices for Children: Policy Options for State Provision of Early Childhood Programs. Paper prepared for the Education Commission of the States. School of Education, Stanford University.

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CHILD CARE SERVICES 191 Hartmann, H., and D. Pearce 1988 Wages and Salaries of Child Care Workers. The Economic and Social Realities. Washington, D.C.: Institute for Women's Policy Research. 1989 High Skill and Low Pay. The Economics of Child Care Work. Washington, D.C.: Institute for Women's Policy Research. Hofferth, S., and D. Phillips 1987 Child care in the United States, 1970-1995. Journal of Marriage and the Family 49:559-571. Hostetler, L. 1984 The nanny trap: Child care work today. Young Children (January):76-79. Kagan, S. 1988 Current reforms in early childhood education: Are we addressing the issues? Young Children 43~23:27-32. Kagan, S., and T. Glennon 1982 Considering proprietary child care. In E. Zigler and E. Gordon, eds., Day Care Scientific and Social Policy Issues. Boston, Mass.: Auburn House. Kahn, A., and S. Kamerman 1987 Child Care: Facing the Hard Choices. Dover, Mass.: Auburn House. Kamerman, S.B., and ~ Kahn 1987 The Unresponsive Workforce: Employers and a Changing Labor Force. New York: Columbia University Press. Lehrman, K, and J. Pace 1985 Day Care Regulation Serving Children or Bureaucrats. Analvsis No. 59. Washinaton, D.C.: Cato Institute. Cato Institute Policy i_-} O Leibowitz, A, Lo Waite, and C. Witsberger 1988 Child care for preschoolers: Differences by child's age. Demography 25(~2~:205- 220. Leuek, M., ~ Orr, and M. O'Connell 1982 Trends in Child Care Arrangements of Working Mothers. Current Population Reports, Series P-23, No. 117, Bureau of the Census. Washington, D.C.: U.S. Department of Commerce. Marx, F., and M. Seligson 1988 The Public School Early Childhood Study: The State Survey. New York: Bank Street College of Education. Massachusetts Department of Social Services 1983 A Comprehensive Child Day Care Delivery System: A Working Plan. Boston: Massachusetts Department of Social Services. MeKey, R., L" Condell, H. Ganson, B. Barrett, C. McConkey, and M. Plantz 1985 The Impact of Head Start on Children, Families' and Communities. Prepared for the Head Start Bureau, Administration for Children, Youth, and Families. DHHS Publ. No. (OHDS) 85-31193. Washington, D.C.: U.S. Department of Health and Human Services. Mitchell, ~ 1988 The Public School Early Education Study: The District Survey. New York: Bank Street College of Education. Morgan, G. 1980 Can quality family day care be achieved through regulation? Pp. 77-102 in S. Kilmer. ea.. Advances in Early Education and Day Care. Greenwich, Conn.: JAI Press, Ine. 1982 Demystifying Day Care Delivery Systems. Unpublished paper. Work/Family Directions, Inc., Watertown, Mass.

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192 WHO CARES FOR AMERICA'S CHILDREN? 1987 The National State of Child Care Regulation, 1986. Watertown, Mass.: Work/ Family Directions, Ine.. National Association for the Education of Young Children 1985 In Whose Hands? A Demographic Fact Sheet on Child Care Providers. Washington, D.C.: National Association for the Education of Young Children. 1986 The Child Care Boom: Growth in Licensed Child Care fom 1977 to 1985. Washington, D.C.: National Association for the Education of Young Children. National Association of Elementary School Principals 1988 NAESP's child care survey. Principal 67~5~:31. O'Connell, M., and C. Rogers 1983 Child Care Arrangements of Working Mothers: June 1982. Current Population Reports, Series P-23, No. 129, Bureau of the Census. Washington, D.C.: U.S. Department of Commerce. Pendleton, A. 1986 Preschool Enrollment: Trends and Implications. Once of Educational Research and Improvement. Washington, D.C.: U.S. Department of Education. Pettygrove, W., M. Whitebook, and R. Weir 1984 Beyond babysitting: Changing the treatment and image of child caregivers. Young Children (July):14-21. Phillips, D. 1986 Testimony. In Child Care: The Emerging Insurance Crisis. Hearings before the Select Committee on Children, Youth, and Families, U.S. House of Representa- tives, 99th Congress, 1st Session. Washington, D.C.: U.S. Government Printing Office. Phillips, D., and M. Whitebook 1986 Who are child care workers? The search for answers. Young Children (May):14- 20. Phillips, D., and E. Zigler 1987 The checkered history of federal care regulation. Pp. 3-42 in E. Rothkopf, ea., The Review of Research in Education 14. Washington, D.C.: American Education Research Association. Presser, H. 1986 Shift work among American women and child care. Joumal of Marriage and the Family 48:551-563. Seligson, M. 1989 Models of School-Age Child Care: A Review of Current Research on Implications for Women and Their Children. Wellesley, Mass. Wellesley College Center for Research on Women. Siegal, P., and M. Lawrence 1984 Information referral and resource centers. In J.T Greenman and R.W. Fuqua, eds., Making Day Care Better. New York: Teachers College Press. Strickland, J., and R. Neugebauer 1985 Yes, we have no insurance. Child Care Information Exchange (July):26-30. Wavers, J., and R. Ruopp 1978 NationalDay Care Study. Preliminary Findings and TheirImplications. Cambridge, Mass.: Abt Associates. U.S. Department of Labor 1988 Childcare: A Workforce Issue. Report of the Secretaries Task Force. Washington, D.C.: U.S. Department of Labor.

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CHILD CARE SERVICES 193 U.S. House of Representatives 1985 Child Care: The Emerging Insurance Crisis. Hearings before the Select Committee on Children, Youth, and Families, 99th Congress, 1st Session. Washington, D.C.: U.S. Government Printing Office. Waite, L^, A. Leibowitz, and ~ Witsberger 1988 What Parents Pay For. Child Care and Child Care Costs. Unpublished paper. Rand Corporation, Santa Monica, Calif. Whaley, M. 1985 The Status of Kindergarten: A Survey of the States. Springfield: Illinois State Board of Education. Whitebook, M., D. Phillips, and C. Howes 1989 Gino Cares? Child Care Teachers and the Quality of Care in America. Executive Summary, National Child Care Staffing Study. Oakland, Calif.: Child Care Employee Project. Zinsser, C 1986 A Study of New York Day Care Worker Salaries and Benefits. New York: Center for Public Advocacy Research. -