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Who Cares for America's Children? (1990)

Chapter: III THE CURRENT SYSTEM6 Child Care Services

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Suggested Citation:"III THE CURRENT SYSTEM6 Child Care Services." National Research Council. 1990. Who Cares for America's Children?. Washington, DC: The National Academies Press. doi: 10.17226/1339.
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III The Current System

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

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

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

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~.

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

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

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

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

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~.

156 WHO CARES FOR AMERICA'S CHILDREN? Advocates of licensing and registration argue that bringing family day care providers into the regulated system would improve the quality of care and professionalize these services. Anecdotal horror stories of children receiving inadequate care in unsafe, unregulated family day care homes are prevalent, although there are no reliable data on such care. When registration was first proposed, it was hoped that it would facilitate entry into the market and provide continuing in-service support to providers, in contrast to licensing procedures which had often screened out many caregivers on the grounds that they are offering substandard services. Although the development of registration programs has been uneven and haphazard, many observers believe that such programs are expanding the visible supply of child care and helping to improve the quality of care for children and the working conditions of caregivers (Norris Class, University of Southern California, personal communication, Apr. 4, 1988; Kahn and Kamerman, 1987; Morgan, 1980~. Other efforts to improve the quality of care in family day care homes including grading systems, municipal coordinating agencies, and advisory councils have been proposed and implemented in some localities, but there are no studies of the effects and effectiveness of these initiatives. Center Care Child care centers serving children from infancy through school age have been established in most communities across the country. The types of programs and the auspices under which they operate range dramatically. Not-for-profit centers are run by local government agencies, community institutions, and employers. Some are freestanding; while others are lo- cated in the facilities of their sponsoring organizations, including churches, schools, hospitals, social service agencies, and places of employment. For- profit centers, operated by large national corporations and independent providers, are typically found in freestanding facilities. Child care centers trace their roots to the day nurseries of the late nineteenth century, but with the entry of mothers into the labor force and the early childhood education developments of the 1960s and 1970s, child care and child development programs have been joined. Child care centers typically serve both purposes, and the difference between child care centers and nursery schools is often blurred. In many communities, the difference between high-quality child care and early childhood' education programs is only the difference between the sponsoring agencies or the auspices under which they operate. In 1971 Caldwell described day care as a "timid giant growing bolder,"

l CHILD CARE SERVICES 157 and in the late 1980s the giant was still growing. Although estimates vary, data from the National Day Care Study reported approximately 34,000 licensed centers nationwide in 1976 (Coelen et al., 1979~; a 1986 survey of state licensing offices by the National Association for the Education of Young Children showed a total of 62,989 child care centers with a capacity of approximately 2.1 million children (Hofferth and Phillips, 1987; National Association for the Education of Young Children, 1986~. The former number represents a 234 percent increase in the number of centers between the mid-1970s and the mid-198Os. The panel's own survey of state licensing offices in 1988 indicates a further modest increase, to approximately 64,078 licensed centers nationwide with a capacity of 2,568,000. This increase in the number of licensed centers and their capacity is consistent with the 50 percent growth in the use of center-based care between 1980 and 1985 by children under age 5 with full-time employed mothers (Hofferth and Phillips, 1987~. It is important to note, however, that even though a center is licensed, it may not be currently in operation. Data from state licensing agencies are not always up to date, and there is evidence that providers enter and leave the market with some frequency. Estimates of the total supply of licensed child care, therefore, may be somewhat inflated. Characteristics of center care programs differ from provider to provider, for curricular programs and materials, configuration of facilities, and care- giver characteristics. State regulations provide minimum thresholds for staf~child ratios, group size, caregiver qualifications, and physical space re- quirements. They may also specify program content requirements, although these are rarely, if ever, enforced. Performance standards established by several professional organizations provide guidelines for safeguarding chil- dren's health and safety and for optimizing developmental outcomes, but the extent to which they are followed is unknown. Within the range represented by regulations and standards, the specific characteristics of center-based care vary substantially. An important distinguishing feature of center care, in comparison with family day care, is that children are generally grouped according to age and developmental stage. Although centers vary in the developmental range of children in a group, they typically include a spread of 6 to 9 months; in contrast, family day care settings may have children whose ages range from infancy through school age in the same space with the same caregiver. Although centers group children more homogeneously by age, they frequently include children that are racially and ethnically more diverse than in family day care homes, especially if they receive federal subsidies for serving children in low-income families or are located in urban settings (Coelen et al., 1979~.

158 Child Care Workers WHO CARES FOR AMERICA'S CHILDREN? Among the most critical characteristics of child care is the caregiver. The number of child care workers has grown by an astounding 90 percent since 1977 and by approximately 43 percent since 1982. The vast majority of these new caregivers are working in centers (National Association for the Education of Young Children, 1985~. Among child care workers, there are notable differences between those in center-based programs and those in family day care. According to the National Day Care Study, in 1977, center care providers had an average of 14 to 15 years of formal education, and 29 percent had 16 or more years of education twice the percentage among all employed females in the United States at that time. Fifty-four percent of caregivers had some post-secondary education, and only 10 percent had not completed high school (Coelen et al., 1979~. In contrast, family day care providers had an average of 11.3 years of formal education. Although the majority had completed high school (57 percent), only about 30 percent had received some post-secondary education (Fosburg, 1981; National Association for the Education of Young Children, 1985~. Caregiver training in early childhood development has been correlated with positive outcomes for children in care (see Chapter 4~. Yet there is no national educational requirement for child care providers. State regulations are not consistent in their requirements for caregiver training; in fact, 23 states do not require preservice training for teachers in child care centers (Morgan, 1987~. States that require training recognize a variety of methods for meeting the standard, including receipt of the Child Development As- sociate (CDA) credential, coursework in institutions of higher learning, and preservice training provided by community organizations. The CDA cre- dential that recognizes the competency of caregivers working with children is awarded by the Council for Early Childhood Professional Recognition, a subsidiary of the National Association for the Education of Young Chil- dren. Since 1975, more than 30,000 caregivers have been awarded the credential; just over 4,000 caregivers were certified in 1989 alone (Carol Phillips, Council for Early Childhood Professional Recognition, personal communication, Jan. 8, 1990~. No analogous data are available on the training of caregivers through colleges or community organizations. Despite their higher levels of education, child care workers in centers command very low salaries. In 1987 more than half of child care workers earned less than $5.00 per hour. Low salaries have contributed to high turnover rates among child care workers. The National Association for the Education of Young Children (1985) and the Child Care Staffing Study (Whitebook et al., 1989) estimate that, between 1980 and 1990, 40 to 42 percent of child care workers will have left their jobs annually, many to seek employment in other fields. These rates are more than double the

CHILD CARE SERVICES 159 average replacement rate of 19.4 percent for all occupations. Low pay, lack of benefits, and stressful working conditions are the major reasons child care providers leave their jobs in such high numbers (National Association for the Education of Young Children, 1985; Phillips and Whitebook, 1986; Whitebook et al., 1989~. Teachers and teaching assistants who earn $4.00 per hour or less left their jobs at twice the rate of those who earned more than $6.0~0 per hour (Whitebook et al., 1989~. For-Profit and Not-for-Profit Centers In 1977 the National Day Care Study estimated that approximately 41 percent of child care centers were operated on a for-profit basis, ei- ther by national corporations or by independent providers (Coelen et al., 1979~. As we discuss in more detail in Chapter 7, efforts by the federal government during the 1980s to "privatize" social services, including child care, has shifted public funding away from direct subsidies to public centers toward subsidies to consumers (parents). Some observers conclude that the availability of consumer subsidies has fueled the growth in proprietary (for-profit) care since the mid-1970s (Kahn and Kamerman, 1987~. Others contend that the decline in direct subsidies to providers has limited the ability of not-for-profit providers to cover the costs of their services and that they have, therefore, not expanded as rapidly. Regardless of the causal rela- tionship, most of the growth in center-based child care over the past decade and a half appears to have been among for-profit providers. Although re- liable estimates of the number of for-profit centers are unavailable, the growth of one form of proprietary care national corporations supports this observation. Kinder Care, the largest national chain, had 510 centers in 1980 and 1,100 centers in 1988. And Children's World Learning Cen- ters, a recent merger of Children's World and Daybridge Learning Centers, had 485 centers in operation in 1988. This growth reflects both internal expansion and the acquisition of other chain and independent operations. Funded by eager investors and meeting the growing child care needs of middle-class suburban families, the national chains are expected to con- tinue to grow into the early 1990s, although at a somewhat slower pace than during the past decade (unpublished 1988 market research by Merrill Lynch; Business Week, July 10, 1989~. Independent centers are by far the most numerous type of for-profit providers (Kagan and Glennon, 1982~. They are also the most diverse in terms of their facilities, programs, and staff. To date little research has focused on them, and data concerning their growth over the past decade and a half are unavailable. Independent centers often are managed by a husband-and-wife team, and they are distinguishable from not-for-profit centers in the same communities only by their legal designation. According

160 WHO CARES FOR AMERICA'S CHILDREN? to Kagan and Glennon (1982), independent centers were especially hard hit by inflation and minimum wage requirements in the early 1980s. As a result, many faced bankruptcy, or sold their businesses to a chain, or converted to not-for-profit status. Those that maintained their independence continually face the need to raise fees in order to cover costs, often more than the increases by corporate chains and not-for-profit centers. In so doing, they risk losing clients for whom even marginally higher fees cause care to be unaffordable. In contrast, the large for-profit chains can take advantage of economies of scale in bulk purchasing and central production in order to reduce operating costs. They can also afford to operate one center at a loss for a period of time if they have sufficient revenues from other centers. Although the quality of care varies dramatically across all types of ser- vices (see Chapter 4), many child development experts and social welfare advocates have been skeptical of for-profit providers. Many of these critics have worried that in the absence of national regulations, for-profit child care would sacrifice the needs of children and caregivers in the interest of generating profits for shareholders. In response, proprietary operators maintain that efficient managerial skills make their centers profitable with- out any reduction in the quality of care (Kagan and Glennon, 1982~. The Child Care Staffing Study (Whitebook et al., 1989), however, concluded that profit status was a strong predictor of quality of care. Not-for-profit centers were found to provide better quality care than for-profit centers regardless of whether either kind received government funds (Whitebook et al., 1989~. There are some significant differences between for-profit and not-for- profit centers that should be noted. First, the percentage of a center's annual operating budget that is spent on staff wages clearly varies by the profit status of the center (although there may be some differences between independent and corporate proprietary providers). Kagan and Glennon (1982) report that for-profit centers consistently spend 10 percent less of their budgets on wages percent, compared with 73 percent spent by not-for-profit centers. Data from the recent Child Care Staffing Study show an overall decline and an even greater discrepancy an average of 45 percent for for-profit centers and 64 percent for not-for-profit centers (Whitebook et al., 1989~. Data from the National Day Care Study showed that average weekly salaries (in the mid-1970s) ranged from $89 to $124 in for-profit centers and from $94 to $160 in not-for-profit centers. Whether or not a center received some federal subsidy for serving low-income children was not a decisive factor in the difference (Coelen et al., 1979~. More recent data suggest that this gap still exists. However, large national chains may be somewhat distinct from independent centers in this regard. Data provided by Children's World Learning Centers indicate that although many aides are at the low end of the salary scale, earning $3.50 to $5.50 per hour,

CHILD CARE SERVICES 161 senior teachers are paid wages comparable to the high end of the scale for not-for-profits, $4.50 to $7.50 per hour. Salary ranges, however, vary locally. In addition, many of the large corporate providers offer benefits that include child care tuition for caregivers' children, educational benefits for workers themselves, and health and pension benefits. Overall, salaries and benefits are less generous on the whole among independent for-profit providers. Most for-profit child care centers have grown up in suburban areas, largely because their prime market is middle-class families with young chil- dren; very few are in rural or inner-city areas. Although both government- sponsored and privately funded not-for-profit centers often receive outside donations to help cover their operating costs, for-profit centers rely al- most entirely on parent fees for their support. They are not likely to receive volunteer staff or donated space and equipment, which is common among not-for-profits (especially those that are church sponsored). As a result, most for-profit centers serve families with median incomes that are above the national average. Although some states have made Social Ser- vice Block Grant (SSBG) Program funds available to for-profit as well as not-for-profit centers to subsidize the care of low-income children, many proprietary providers are reluctant to accept children if the reimbursement rates do not cover their full costs of providing care or if additional fees can not be collected from parents. As a result, in general, the population of children in for-profit centers is likely to be more homogeneous than that in not-for-profit centers. Personnel costs account for the bulk of the operating costs of child care centers. The National Day Care Study reported that the average monthly resource cost per full-time equivalent child (in 1977) was about $161; the range was from $80 to $310 per month, with about two-thirds of center expenditures for personnel (Travers and Ruopp, 1978~. Costs are not necessarily affected significantly by group size, but the staff/child ratio and the caregivers' level of education and length of experience do affect costs. For-profit centers typically have fewer staff per child than not-for-profit centers, although they follow state regulations (Coelen et al., 1979; Kagan and Glennon, 1982~. There are a relatively larger number of for-profit centers located in southern states, perhaps because those states have less stringent regulations concerning staff/child ratios. Georgia, for example, requires only one staff member for every seven infants; while Massachusetts requires one for every three infants, and Georgia has significantly more proprietary centers than does Massachusetts. It should be noted, however, that among the national chains providing very high-quality (and high-priced) care, staff/child ratios often equal those found in not-for-profit centers. As a consequence of higher staff/child ratios, federally funded, not-for-profit

162 WHO CARES FOR AMERICA'S CHILDREN? TABLE 6-3 Weekly Rates for Center-Based Child Care in 15 Cities, August 1987 Preschool-Age City Infants Toddlers Children Atlanta, Ga. $120 $30-75 $30-75 Boston, Mass. 125-148 90-146 39-110 Chicago, Ill. 85-125 75-90 50-85 Cleveland, Ohio 42-105 30-78 20-78 Denver, Colo. 60-110 55-95 50-100 Greenville, S.C. 35-80 35-80 35-75 Los Angeles, Calif. 58-134 58-134 40-81 Miami, Fla. 45-93 35-83 35-83 Minneapolis, Minn. 100-150 80-100 70-90 New Orleans, La. 45-65 45-50 40-50 New York, N.Y. 45-190 60-150 60-150 Oklahoma City, Okla. 50-80 45-65 40-65 Raleigh, N.C. 35-100 25-85 25-85 Seattle, Wash. 115-150 81 69 Washington, D.C. 52-135 52-135 52-110 Source: Data from Work/Family Directions, Inc. centers typically have higher per capita operating costs. But when ratios and wage rates are held constant, there are no significant differences in per child costs between federally funded and parent-fee centers (Travers and Ruopp, 1978~. Fees charged for care vary widely within and across all types of care and geographic regions; see liable 6.3. In some areas (e.g., Seattle), family day care is considerably less expensive than center-based care for infants and toddlers. However, in other areas (e.g., Boston and Denver), family day care may be similar in price for infant and toddler care. Although regulations such as those for staff/child ratios affect the cost of providing care, there seems to be no direct correlation between staff/child ratios and the fees charged to parents: for example, the fees for center-based care for infants in Atlanta and Boston are similar even though required staff/child ratios are 1:7 and 1:3, respectively. The price of care declines as the age of the child increases, largely because the ratio of caregivers to children decreases. However, very little is known about the relative effects of regulations and other factors such as teacher qualifications, local labor market conditions, and local cost of living, on center care fees. No research has been conducted to study how programs establish their fees.

CHILD CARE SERVICES Employer-Prov~ded Care 163 There is growing involvement of employers in providing on- or near- site child care for their employees' children. Most are operated by outside providers contracted to manage a facility on behalf of the employer. Most of the providers are not-for-profit organizations, although, increasingly, national corporate chains are contracting with employers, including gov- ernment employers, to provide child care services for employees' children (Dana Friedman, The Conference Board, personal communication, Dec. 9, 1988~. The number of on- or near-site child care centers, whether employer-owned and -operated, contracted, joint with unions, or as a con- sortium of several employers, has clearly grown in the past 10 years. A 1978 employer survey reported 105 centers, and a 1988 report found approxi- mately 600 hospitals, 200 corporations, and 100 public agencies providing on-site care (Friedman, 1988~. The Bureau of Labor Statistics (1988) found that about 1 percent or less of private establishments surveyed (that were not in business to provide child care services) sponsored centers. Few of these establishments were in manufacturing industries, approximately two-thirds were service industries, and one-third were government (federal, state, or local). Hospitals, medical-related facilities, hotels, and government agencies are the most likely employers to provide on-site child care. Em- ployers that provide centers report that they are "satisfied," and the centers contribute to several employer goals, including improved productivity, less absenteeism and turnover, and lower recruitment costs (Burud et al., 19844. Although the current trend is new, it is not unprecedented. Employers provided work-site care during the Civil War and both world wars. During World War II, 2,500 centers were established to increase the number of women employees. Public-sector unions have been particularly successful at negotiating for day care centers. The federal government, as an employer, contin- ues to establish work-site centers; the Internal Revenue Service recently announced plans to open 10 new centers, and the U.S. Department of De- fense has opened a center at the Pentagon in Washington, D.C. The most extensive public-sector initiative, however, is in New York State, where 30 centers serving over 2,000 children have been established through collec- tive bargaining. The state provides for start-up costs, space, utilities, and maintenance. After start-up, the centers are expected to be self-supporting (U.S. Department of Labor, 1988~. In the 48 programs cited by the U.S. Department of Labor and the Service Employees International Union, work-site child care is the most frequent child care support negotiated by both public-sector (59 percent) and private-sector (37 percent) unions. It seems unlikely, however, that work-site centers will become a major source of care for young children. Employers report that establishing a

164 WHO CARES FOR AMERICA'S CHILDREN? center is an expensive and unfamiliar undertaking. Quality control and potential liability are concerns, as are siting and transportation problems (Bureau of National Affairs, 1984~. Firms also report concern about the perceptions or reality of an expensive benefit applicable to relatively few employees and the uncertainty of employee use. For example, one employer reported that, even with a subsidy, the fees charged at a high-quality center were beyond the reach of single mothers on the support staff who were the primary target beneficiaries (Kamerman and Kahn, 1987~. Therefore, on-site child care is sometimes regarded as a recruitment and retention mechanism for women in professional and managerial jobs. There is also some evidence that employees prefer care close to home: they may not want to commute with children, especially on pub- lic transportation, or the on-site care might not be the type of preferred care. Kamerman and Kahn (1987) provide several examples of work-site centers corporate centers (AT&T), union centers (Amalgamated Clothing and Textile Workers Union), and employer consortium (Northside Child Development Center in Minneapolis) that were unsuccessful because they were underused by employees. Yet in 1989 contract negotiations, AT&T and its union highlighted the importance of child care as an employee benefit. School-Based Programs Increasingly over the past several years, public schools have expanded their role in early childhood education and child care. In 1988 more than half of the states mandated the provision of kindergarten programs for 5year-olds; even among states where kindergartens are still optional, most local districts have been providing programs (Whaley, 1985; data from panel survey). Most states require school attendance in first grade at age 6 or 7, and kindergarten attendance is discretionary. In 1986 approximately 95 percent of 5-year-olds were enrolled in public or private kindergarten programs (Pendleton, 1986~. In fact, many school systems across the country are moving to change from part-day programs to full-day programs. As kindergarten programs have become virtually universal, many states and local school systems have begun to offer prekindergarten programs for 4-year-olds. In 1987 24 states were funding such programs, and several others were considering them (Marx and Seligson, 1988~. In all but three cases, they were administered by the state's department of education; in New Jersey, Alaska, and Washington, they were operated by other state agencies. According to estimates provided by the Public School Early Childhood Study (Marx and Seligson, 1988), 130,452 children received services in 1987, with Texas alone serving nearly 49,000 children. Most state laws governing school programs for 4-year-olds permit but do not

CHILD CARE SERVICES 165 mandate attendance. A few states provide funds in the state-aid formula pattern followed for kindergarten, but most set specific limits on the amount that local districts have to spend for these programs (Kahn and Kamerman, 1987~. Local school districts also operate and fund prekindergarten programs. More than 8 percent of the early childhood programs catalogued in the District Survey of the Public School Early Childhood Study were locally funded (Mitchell, 1988~. Unlike state-funded programs, those programs rely on a combination of local funds and parent fees. When states fund pro- grams for 4-year-olds, the programs are almost always targeted to children at risk of educational failure, and priority is given to low-income children. Most locally funded programs, in contrast, do not use income as an eligi- bility criterion; nevertheless, to date, most state and local prekindergarten initiatives have been compensatory in their orientation (Mitchell, 1988~. School-based prekindergarten programs range from those that use kindergarten facilities, staffing ratios, and schedules to others that attempt to approximate the Head Start model. Marx and Seligson (1988) report that to some extent the growth of public school programs has resulted in increased competition with Head Start programs for staff and space. Most public schools that have prekindergarten classes offer part-day programs, although in a few cases states have contracted with agencies outside the schools to coordinate child care services to offer full-day coverage for working parents. However, Marx and Seligson (1988) indicate that although many of these programs serve children's educational needs well, most do not completely fulfill working parents' or children's full-day child care needs. Most programs are exempt from state licensing requirements relating to health, nutrition, group size, teacher qualification, and physical space. Staf~child ratios and group size vary somewhat from state to state; in general, however, programs have limited their class size to 20 children and maintain a ratio of 1 staff member for every 10 children (Gnezda and Robinson, 1986~. The lack of regulatory restriction has facilitated the expansion of school-based prekindergarten programs. In New York City, Project Giant Step supports programs for 4-year-olds and provides funding both to public schools and to the social service system; the schools have been able to move more quickly to establish programs and enroll students, partly because the schools do not have to contend with the lengthy and complicated licensing process required of social service programs (Kagan, 1988~. In many cases, the schools do not meet the licensing requirements imposed on child care provided by social service agencies. Public schools also have the added advantage of available, suitable space. The staff of public school programs is also different from that of center-based programs. Typically, school-based programs employ certified

166 WHO CARES FOR AMERICA'S CHILDREN? teachers, whose qualifications are the same as those for teachers in the elementary grades (Gnezda and Robinson, 1986; Marx and Seligson, 1988; Mitchell, 1988~. Some states and local districts also require that caregivers have training in early child development and early childhood education. An important implication of the higher education levels of teachers in prekindergarten school programs is that the teachers command higher salaries than do those in center-based programs. In 1984 the median in- come of a prekindergarten or kindergarten teacher in the public schools was $15,648; for caregivers in organized child care programs operated under so- cial services auspices it was $9,204 (National Association for the Education of Young Children, 1985~. This earnings differential has been a source of tension. As school-based prekindergarten programs have expanded, many of the best-qualified caregivers in child care centers have moved to the public schools because of higher salaries and benefits. And some observers project that this issue will become more salient as both the educational system and the social service system seek to further expand their programs, so they will be competing for an insufficient pool of highly qualified staff. The expansion of public school programs for 4-year-olds has fueled the long-standing controversy between advocates of child care and early childhood education. Those who favor school-based programs argue that the schools have an established and stable funding base, as well as access to school building space, transportation systems, and other ancillary ser- vices, and are trusted institutions in most communities. Consequently, early childhood programs in school settings could provide a universal integrat- ing experience to help overcome the two-tiered system that has developed in the present child care system-in which poor children are served in means-tested day care programs while middle- and upper-class children at- tend proprietary or private nursery programs (Kahn and Kamerman, 1987; Kagan, 1988~. On the other side, child care advocates argue that many inner-city schools are doing so badly at educating poor and minority chil- dren that making such schools responsible for very young children would only cause the failure to begin earlier. They cite the lack of regulations, insensitivity of traditional elementary teachers, resistance to parent involve- ment, and overly rigid academic programming as factors that make schools inappropriate settings for preschool-age children (Kagan, 1988; Kahn and Kamerman, 1987~. In addition, because many public school programs do not operate all day, they are not responsive to the child care needs of working parents. The expansion of school-based programs for 4-year-olds, and increas- ingly for 3-year-olds, has implications for organized child care programs and vice versa. During the 1970s and early 1980s, seeing a need for out- of-home programs for young children, small private providers and large

CHILD CARE SERVICES 167 national chains invested heavily and created a significant child care re- source at a time when the public schools showed no interest in becoming involved. A substantial shift of prekindergarten care to the public schools could threaten these businesses. Indeed, for-profit as well as not-for-profit centers "need" to serve preschoolers in order to serve infants and toddlers at reasonable weekly rates. In short, to remove preschoolers from these settings would probably create a funding crisis for infant and toddler care. Given the limits on the numbers of infants who can be served in a single center under some state regulations, it would be economically infeasible to operate a center without a supply of preschoolers in the census in many jurisdictions (Kahn and Kamerman, 1987~. In light of this economic reality, it is likely that the existing amalgam of public and private, for-profit and not-for-profit child care programs will not easily or quietly relinquish the 3- and 4-year-old market to the public schools. Head Start Established in the mid-1960s, Head Start continues as the only federally funded comprehensive early childhood program for low-income preschool children. Over more than 20 years it has managed to sustain the strong support of the Congress and of Republican and Democratic administra- tions, despite significant cuts in most other education and social service programs. Approximately 1,300 local programs across the country serve children between the ages of 3 and 5, with primary emphasis on 3- and 4-year-olds. The stated goal of Head Start is to provide economically dis- advantaged children with an early socialization and education experience that will prepare them to begin elementary school on an equal footing with their more economically advantaged peers. Head Start is a comprehensive services program that includes four major components: education, health, social services, and parent involve- ment. The program was not established as a child care service, and the fact that it operates as a part-day program at most sites limits its ability to meet the child care needs of many low-income working parents or the developmental needs of many children who would benefit from a structured full-day program. Currently, about 20 percent of local Head Start programs operate full day in order to combine high-quality compensatory education, social, medical, and nutrition services, as well as parent education, with more traditional child care services and schedules. Yet program officials are quick to distinguish Head Start from child care programs, and there is some disagreement within and outside of the federal government about whether to include Head Start funding in a tally of federal expenditures for child care.

168 WHO CARES FOR AMERICA'S CHILDREN? 1b be eligible for Head Start, children must live in families below the poverty line or have disabilities; only about 10 percent of Head Start participants are nonpoor. Matching roughly the poverty distribution in the United States, approximately 42 percent of Head Start participants are black, 20 percent are Hispanic, 4 percent are American Indian, and 34 percent are white. Ten percent of the children have disabilities. The program serves about 450,000 children, which is less than 20 percent of the income-eligible 3- to S-year-olds across the country, and that proportion has remained stable since its establishment (unpublished data from the Administration for Children, Youth, and Families, U.S. Department of Health and Human Services). From its inception, Head Start has involved parents. The Head Start performance standards require that parents have an opportunity to be involved as decision makers and as classroom participants. Many are involved as paid staff and as volunteer aides to the programs. A 1982-1983 study found that 29 percent of Head Start staff nationally were parents of children in the program (McKey et al., 1985~. Head Start staff run parent education programs and conduct home visits to strengthen the links between families and the program. In the future, however, the increasing labor force participation of mothers may reduce parents' ability to be active program participants. Increasingly, full-time working parents may find it difficult to volunteer in the classroom or to attend parent education groups. In addition to the comprehensiveness of its program, several charac- teristics distinguish Head Start from other preschool education programs, particularly those provided by public schools. Most important among these are licensing and staffing. Head Start programs and child care programs are licensed by the same state-level department usually human services, welfare, or community development (Goodman and Brady, 1988~. Require- ments for physical facilities are usually quite strict and may be a barrier to the establishment of programs. In contrast, school programs have no licensing standards. For staff, the reverse is often the case: states require less education for personnel in child care centers and Head Start pro- grams than they do for teacher certification. This difference has in some cases been a barrier to Head Start programs' receiving state supplemental funds or working with local education agencies to provide preschool pro- grams (Goodman and Brady, 1988~. Many Head Start teachers have the relevant coursework and experience necessary for working with children, including a child development associate credential, but lack the formal college education and public school teaching credential required to teach in a school-based program. Goodman and Brady (1988) report that even though Head Start teachers have appropriate credentials, the fact that the program is licensed by state welfare departments creates image problems in the public school community.

CHILD CARE SERVICES 169 Head Start is one of the few 1964 antipoverty programs to have survived through the 1980s. Two significant factors have undoubtedly contributed to its success. First, Head Start has always been a demonstration program, not an entitlement program: that is, the program is not automatically available to all eligible children. The federal government provides direct grants to local agencies, including churches, community action agencies, public and private not-for-profit organizations, and education agencies. Regardless of the local sponsoring agency, Head Start programs can be located in public school facilities. Approximately 20 percent of local programs are administered by local school districts and located in local public school buildings. Grubb (1987) reports that there is little evidence to suggest that programs run by education agencies differ markedly from those operated by other agencies. Clearly articulated national performance standards provide program structure, but with enough flexibility to take advantage of the strengths and resources of local communities. Second, in addition to federal funding, several states have laws that provide funds for the expansion or enhancement of Head Start programs or other preschool programs. Eight states support only Head Start, whereas 25 states and the District of Columbia support only school districts or school districts and other nonprofit agencies, including those that sponsor Head Start programs. Two states, Connecticut and Massachusetts, specify that the program funds be used for increasing the salaries of Head Start staff. In other states, the funds have been used either to enlarge the population served or to extend the program to full day. A major issue for states that have sought to use the funds to extend services is that Head Start income eligibility requirements exclude many at-risk preschool children and their families who would benefit from the comprehensive services but do not meet the poverty criterion. In Rhode Island, for example, legislative priority has been given to children of working parents who are poor but not income eligible for Head Start and do not have enough money to purchase needed seances themselves. Rhode Island Head Start directors expanded services to this population by adding a new eligibility category the working poor whose incomes exceed the federal income guidelines of $11,650 for a family of four. This step has extended services to 500 children in that state who would otherwise not have qualified (Goodman et al., 1988~. A potential disadvantage of state Head Start-only programs is that Head Start staffs are not encouraged to form coalitions with other child care and early childhood education systems to achieve parity in services, credentials, and wages. Moreover, this approach does not foster coordina- tion between Head Start and state education agencies, adding to existing concerns that Head Start is isolated from other child care and early child- hood programs and that it is insulated from the space, funding, and staffing

170 WHO CARES FOR AMERICA'S CHILDREN? stresses that affect others. Goodman and Brady (1988) urge that state leg- islation require that Head Start programs coordinate with state and local education agencies as a condition of funding. Programs for Children With Disabilities Federal funds are available to support a variety of child care services for children with disabilities. The Education for All Handicapped Children Act (P.L. 94-142) and the Education for the Handicapped Act Amendments of 1986 (P.L. 99457) provide funds for the education of children with special needs under the direction of the public schools. Chapter I of the Elementary and Secondary Education Act (P.L. 89-313) provides funds for the public school education of disabled children who are in need of compensatory services because of economic disadvantage. SSBGs provide funds to the states to be used in part to reimburse child care costs for disabled children in low-income families. And Head Start reserves a proportion of its enrollment for disadvantaged children with disabilities. To coordinate these separate programs, the Administration for Children, Youth, and Families in the U.S. Department of Health and Human Services and the Office of Special Education and Rehabilitative Services in the U.S. Department of Education signed an interagency agreement in 1978 to promote collaboration between the social service system and the public schools in serving very young children with disabilities. The result was a national network of resource access projects mandated to work with state education agencies to establish effective local mechanisms for collaboration between local public schools and Head Start programs. By 1988 this initiative had produced a total of 39 interagency agreements at the state level. Goodman and Brady (1988) conclude that this activity has improved formal and informal working relationships between Head Start programs and the schools. They also conclude that these interagency efforts to serve children with disabilities have significantly enhanced Head Start's visibility as a service provider and in many cases have paved the way for Head Start participation in state-funded preschool activities. Care for School-Age Children In the mid-1980s concern that a large number of children of working parents might be in self-care during the afternoons, between the closing of elementary schools and the time parents are home from work, led to widespread discussion of latchkey children. Although estimates of the actual number of children of working parents who are unsupervised when school is not in session vary widely, concern about the issue has led to

ClIILD CARE SERVICES 171 numerous proposals and programs to provide organized before- and after- school care for school-age children. Current programs are both publicly and privately provided, through the schools, child care centers, and community agencies. Although there are no reliable national data on the supply of such programs, many observers conclude that there is still a shortage (U.S. Department of Labor, 1988~. By 1988 12 states had legislated some form of funding for school-age child care initiatives, and the federal government was providing modest support through a dependent-care block grant. Programs differ greatly and are administered by a diverse group of providers, including public and private schools, child care centers, youth centers, and family day care providers. According to Michelle Seligson of the School-Age Child Care Project at Wellesley College (personal communication, May 23, 1988), the services provided by these organizations have grown significantly in the past several years: approximately 50 percent of YMCAs now operate after- school programs 5 days per week, twice the number reported 5 years ago. It is estimated that the Boys Clubs of America, Campfire, Inc., and other youth organizations run more than 250 programs. In a National Council of Churches survey of churches that reported providing child care services, at least 30 percent indicated that they also provide after-school care. Approx- imately 300 independent schools about half of all independent elementary and middle schools now have extended-day programs. And, increasingly, large for-profit providers are introducing before- and after-school programs in their centers. Public schools are beginning to supplement these efforts in many communities. A recent survey conducted by the National Association of Elementary School Principals found that 22 percent of principals think school-age child care programs are important, compared with only 8 percent in 1980 (National Association of Elementary School Principals, 1988~. Some states that fund school-age child care programs restrict those funds to school-based and -administered programs. However, the use of school facilities has been a significant issue in many communities considering extended-day programs. Both the teachers' unions, which restrict the work hours of teachers and the use of nonunion staff in classrooms, and the custodians' unions, which have opposed use of the facilities by other groups during off-school hours, have presented barriers (Gannett, 1985~. As a result, school-based, extended-day programs have not been developed in many communities. Community centers, churches, and youth-serving social service agencies have more often been the auspice of service, creating a need for transportation between schools and after-school programs. Many not-for-profit and proprietary providers of child care have also begun to offer after-school programs and to escort children or transport them by vans from school to the centers. Kinder Care and Children's

172 WHO CARES FOR AMERICA'S CHILDREN? World Learning Centers, for example, offer school-age programs in all their centers. And Kinder Care reports that it serves 20,000 children in a summer program called Club Mates (Michelle Seligson, Wellesley College, personal communication, May 23, 1988~. For 6- to 8-year-olds, many of these programs offer interesting and stimulating activities. For older elementary school children, however, center-based models may not be appropriate. Children between the ages of 9 and 12 clearly need some monitoring and need to know that responsible adults are available to them if needed, but many do not need or want the close supervision that is required for younger children. For those who prefer "down time" after school rather than another 2 hours of organized classroom activity, for those who need more physical and athletic outlets for their energies at the end of the school day, and for those who want a quiet place to do homework, a child care center with its classroom confinement and large groups of children of mixed ages is frequently unappealing. Family day care is the second most popular out-of-home after-school arrangement for school-age children. Approximately 24 percent of school- age children are cared for in family day care homes, compared with 7 percent who attend child care centers after school (Bureau of the Census, 1987~. These arrangements may owe their popularity to the flexibility of the provider. The provider may allow children to play outside, within earshot, or to check in on a regular basis if they leave the vicinity. This may make for a more satisfying experience for children who, as they get older, desire more autonomy (Seligson, 1989~. Another issue in the provision of before- and after-school care is the availability of funds to pay for staff, facilities, and transportation (if needed). Because even publicly funded programs are typically not fully subsidized, parent fees are necessary to cover the costs of services. Available data suggest that these fees range from $10 to $60 per week depending on the funding arrangements. Michelle Seligson reports that programs in the South and Midwest are lower in cost than those in the Northeast and far West because of variations in staff salaries in the regions. Public school programs are able to reduce the costs of providing care if they do not hire a separate program administrator and if programs are not charged for space, utilities, and janitorial services. Currently, school-based after-school programs are largely funded by parent fees about 65 percent and for many low-income families the fees may be unaffordable (National Association of Elementary School Principals, 1988~. In 1986 the Children's Defense Fund found that only two of the states that had initiated legislation on school-age child care had directed the funds to serve children in low-income families (Blank and WiLkins, 1986~.

CHILD CARE SERVICES 173 PROGRAMS TO SUPPORT THE DELIVERY OF CHILD CARE SERVICES Resource and Referral Services Responding to the diversity and decentralization of child care services, child care resource and referral programs have been a major development of the 1980s. Their purpose is to assist parents in understanding the choices of child care arrangements available to them, to give support and information to providers, and to collect and report data concerning the supply and demand for child care that can be used for planning community, state, and national resources. Motivated by a desire to improve the child care system in their communities, these programs developed as grassroots organizations representing the perspectives of parents, providers, and community groups. They have grown rapidly over the past several years with support from the states, community groups, and a few large employers. Despite a diversity of origins, resource and referral programs across the country have emerged with a similar orientation and typically provide a set of services designed to reach their separate and yet overlapping constituencies: (1) information and referral, (2) technical assistance and training, and (3) advocacy and community education (Siegel and Lawrence, 1984~. Beyond this core set, programs provide a range of other services that are responsive to local needs and circumstances. In Massachusetts and California, for example, they also administer vendor-voucher programs. In these states and others, some resource and referral programs administer the Child Care Food Program, organize family day care networks, operate hot lines (or "warm lines") to provide information to parents on children's health and behavior, operate programs to stimulate interactions between school-age children and senior citizens, and provide market information and assistance to prospective child care providers. Programs are usually staffed by former center and family day care providers, child development specialists, and family counseling and parent education experts. Depending on levels of public subsidy, most agencies charge fees to consumers. Some use sliding scales so that low-income users pay less, and parents who are eligible for public subsidy are not charged for services. Some agencies also offer different levels of service and vary their fees accordingly. California, Massachusetts, and New York now provide statewide re- source and referral services. Many cities have also developed systems of resource and referral services. More recently, the private sector has also recognized the effectiveness of these initiatives. Some corporations con- tract with service programs and pay client fees for their employees. IBM, for example, provides a national service for its employees by contracting with existing local services or creating programs. 1b help potential service

174 WHO CARES FOR AMERICA '5 CHILDREN? programs handle their employee load, IBM provided computer systems and developed software programs. Other companies were ahead of IBM in contracting with local programs, but IBM launched the first large national program. Subsequently, several other corporations have modeled their own initiatives on that of IBM. Kahn and Kamerman (1987) report that in some instances local resource and referral agencies are providing company clients with special services and quality assurance, as well as assigned staff and telephone lines. Employers have also recognized the role of resource and referral services in the development of child care services. For example, the Bank of America and several other private and public employers funded resource and referral services in the San Francisco area to recruit and train family day care providers. Resource and referral services represent a significant innovation to enhance the effectiveness of the child care delivery system and to assist parents in choosing child care arrangements. Although there have been no national studies to evaluate the impact of these programs, there is a lot of anecdotal information at the local level on their effectiveness in linking consumers and providers; developing a cooperative relationship with community agencies and private organizations serving children and their families; recruiting new providers; and providing information, training, and technical assistance to providers. They have also served public education and information functions at a time when both the supply of and the demand for child care services have grown rapidly, and when the policies, programs, and regulations governing child care have been changing just as rapidly. As child care services continue to expand, resource and referral services will undoubtedly play a central role. Nevertheless, as advocates and observers readily acknowledge, they are not a panacea. They cannot solve many of the problems that plague child care in the United States, including the quality of staffing, equitable salaries, the types of services available, and the levels of public subsidy (Kahn and Kamerman, 1987; Morgan, 1982; Siegal and Lawrence, 1984~. Provider Networks Another innovation of the 1980s was the growth of family day care networks. The National Day Care Home Study estimated in 1978 that approximately 30,000 caregivers serving at least 120,000 children were op- erating as a part of a "network of homes under the sponsorship of a local administrative agency" (Fosburg, 1981~. In 1986 approximately 85,000 fam- ily day care homes participating in the Child Care Food Program were affiliated with 800 sponsoring institutions (Glantz et al., 1988~. And of

CHILD CARE SERVICES 175 course, there may be others that do not participate in the federal food program of the U.S. Department of Agriculture. Networks developed initially as a result of state or local requirements governing federal subsidies (under Social Security) for the care of children from low-income families. Because funding was linked to state licensing requirements, the formation of networks enabled government agencies to deal efficiently with individual family day care providers. Payments, audits, inspections, and referrals could be handled routinely for a number of providers through one central administrative organization, usually child care agencies that were also operating centers. As participation in the Family Day Care Food Program has expanded since the mid-1970s, this source of federal subsidy has also created incentives for family day care providers to become a part of a network. In some instances, networks guarantee a number of places for children from low-income families, certify providers' eligibility and guarantee that they meet specified standards of care, and manage vacancy control, bookkeeping, and reimbursements. A recent study of the Child Care Food Program reports that participation by family day care providers has increased dramatically: in 1980 there were 18,000 homes participating in the program; in 1986 there were approximately 85,000 (Glantz et al., 1988~. Most of the increase is attributable to the increase in the number of sponsoring networks or systems. Networks may include as few as 10 homes or as many as 1,000; the vast majority have about 50 (Glantz et al., 1988~. Over time the role of many provider networks has expanded to include other services, such as training and referral services to providers, toy lending libraries, shared activities, drop-in centers for providers, and emergency back-up caregivers. To cover the costs of these services, many networks collect parent fees in addition to modest state and local funding. On average, sponsors visit homes eight times per year, and these visits combine monitoring with training and technical assistance to providers (Glantz et al., 1988~. Sponsors' administrative costs per home decline as the number of homes in the network increases. The estimated monthly administrative cost per home is $77 for sponsors with no more than 50 homes, $49 for sponsors with 51 to 200 homes, and $46 for sponsors with more than 200 homes (Glantz et al., 1988~. Many observers hope that provider networks, like resource and refer- ral services, can help to bring family day care providers into the regulated system and provide support and services to improve the professionalism of these providers and the quality of their services. Although the financial incentives and available technical support will undoubtedly make it attrac- tive for some family day care providers to join a network, others see a significant disadvantage in outside supervision of private in-home services.

176 WHO CARES FOR AMERICA'S CHILDREN? Vendor-Voucher Programs Another innovative strategy for expanding parental choice in arranging child care, providing subsidies for the care of children from low-income families, and providing support for providers is vendor-voucher programs. In some cases these programs are supported by public funds alone; in others, they are packaged with philanthropic contributions or supplements from employers. These programs provide "vouchers" to parents to purchase approved child care. In vendor-voucher programs financed with public funds, parents se- lect a child care provider (center or family day care home) and pay an income-tested fee (unless they are eligible for full subsidy). The agency administering the vendor-voucher program pays a weekly supplement at an agreed upon rate after the child's attendance is verified. Providers must be licensed or registered (or be in the process of qualifying) to be eligible to receive voucher payments. Depending on the particular provisions of the program, performance standards used to determine eligibility may or may not be more stringent than those imposed by the state for child care licensing. In some cases, they are used as a leverage for providing technical assistance and monitoring (Kahn and Kamerman, 1987~. Vendor-voucher programs have emerged in several states and commu- nities, the largest being California's alternative payments program. Some have been developed specifically as vendor-voucher programs; others have grown out of ongoing community-based child care initiatives. An important result of all of these programs has been a considerable increase in the use of family day care in jurisdictions in which most public child care funds have been directed to centers. 1b some extent, this trend undoubtedly reflects parental preferences concerning the care of infants and toddlers, an inadequate supply of center care for very young children, and lower fees for family day care (Kahn and Kamerman, 1987~. Another outcome of these programs has been an increase in the num- ber of centers serving low-income and publicly subsidized clients. Previously, "purchase of service" contracts limited participating centers to confined ge- ographic areas, generally in the inner cities; vouchers have expanded the type and location of centers that participate. Program officials report that providers sometimes include proprietary centers as well as specialized nurs- ery schools. And in some communities after-school programs are also included in the vendor-voucher system (Ruth Frets, Resources for Family Development, personal communication, Feb. 9, 1988~. A decided benefit of these programs is that they have enabled some low-income families to purchase services outside their own segregated inner-city neighborhoods (Kahn and Kamerman, 1987~.

CHILD CARE SERVICES 177 Some employers provide child care benefits through vender-voucher programs. Employers may negotiate reduced rates for their employees at a local child care center. Most often the vendor programs are negotiated with large for-profit chains that have multiple locations. Employers usually negotiate a fee reduction of approximately 10 percent, and they guarantee a certain number of places for the provider. In some of the programs reported by Friedman (1985), the employer contributed an additional 10 percent, reducing employee costs by 20 percent. This type of program requires that employees use the selected type of care. The large chains are likely to be more expensive than alternative forms of care and thus may be of primary benefit to the higher paid professional workers. As of 1984, Friedman (1985) reported that Kinder Care had 75 companies participating in the industry program. At LaPetite Academy, 155 companies worked with "employer care" discounts program, and at Children's World, 17 employers were participating in the career care program. Many observers conclude that vendor-voucher programs are an attrac- tive way to administer public funding to support child care. In accord with the general movement in the early 1980s to provide more direct support to consumers (parents) than to suppliers (providers), vouchers give parents the ability to choose the types of child care they want for their children, relatively unconstrained by government intervention. As Kahn and Kamer- man (1987) point out, part of the attractiveness of such an approach derives from the facts that the child care market is very diverse and that there is no universal system of care. To date, there have been no major evaluations of vendor-voucher initiatives, so definitive evidence of their effects on the quality of care and the efficiency of administering public subsidies is lacking. However, Grubb (1988) points out that vendor-voucher mechanisms in California have been enthusiastically supported by fiscal conservatives seeking to reduce the costs of care. They argue that the use of vouchers causes the market to operate more efficiently because it puts providers in competition with one another and therefore drives down the wages of child care workers (but see below). 1b the extent that this "efficiency" fosters high turnover and instability, it is likely to have negative effects on the quality of care and on child outcomes (as discussed in Chapter 4~. Kahn and Kamerman (1987) report that those who administer vendor- voucher programs are enthusiastic and believe that they can operate success- fully, both because they enhance parents' choices and because they offer a simple mechanism for channeling resources. It is up to the providers to make services attractive and desirable to consumers. There is, how- ever, significant opposition to these programs, from several sources. Some economists worry that vouchers will necessarily raise the price of child care for all consumers, because they will increase the demand (Grubb, 19884.

178 WHO CARES FOR AMERICA'S CHILDREN? Many traditional child welfare advocates believe that trained case workers may be better able to choose appropriate care settings than parents. They frequently oppose vouchers on the grounds that parents may not make well- informed decisions that are in the best interests of their children, especially if the children are too young to communicate about their experiences in child care. Opposition also comes from providers who are accustomed to purchase-of-service contracts that guaranteed them fees for an agreed upon number of children (Kahn and Kamerman, 1987~. To address these latter concerns, California administers its vendor-voucher program through its resource and referral services. Parents receive information on the care alternatives available to them and counseling on how to assess their choices. Centers and family day care homes receive referrals if they are listed as eligible providers. BARRIERS TO TlIE DELIVERY OF SERVICES Staffing There is perhaps no issue more essential to the future of child care in the United States than staffing. As child care research demonstrates, the quality of caregivers and the interaction between caregivers and children are major determinants of the developmental effects of supplemental care. There is growing recognition of the importance of early childhood staff and the factors that threaten the quality and stability of the current and future labor pool, including salaries and wages, working conditions, training, and professionalism. As we have discussed above, although the salaries of child care workers vary among programs and settings, they are low in comparison with salaries in other occupations that require similar levels of education and work experience (Hartmann and Pearce, 1989; National Association for the Education of Young Children, 1985~. In fact, census data and information from salary surveys confirm that, overall, child care workers earn wages below the poverty level (Phillips and Whitebook, 1986; Whitebook et al., 1989~. Estimates of the hourly earnings of child care workers depend on the categories of workers that are included. In 1988 the Child Care Staffing Study (Whitebook et al., 1989) reported that the average hourly wage for child care workers was $5.35, which is an annual income of $9,363 for full-time employment. Because many of these caregivers are unmarried heads of household, it is worth noting that in 1988 the federal poverty level (for a family of three) was $9,431 (Bureau of the Census, as cited in Whitebook et al., 1989~. Most child care workers do not receive yearly cost- of-living or merit increases, and they receive only minimal benefits. Only 40 percent receive health coverage. Moreover, despite gains in overall formal

CHILD CARE SERVICES 179 education and experience, child care workers were paid even less in 1988 than in 1977. Wages, adjusted for inflation, fell 27 percent for child care teachers and 20 percent for teaching assistants (Whitebook et al., 1989~. Although salary figures reflect some geographic variation, Hartmann and Pearce (1989) report that more than 40 percent of full-time child care workers in 1987 earned less than $5.00 per hour. Part-time workers fared even worse, with just over 60 percent of the teachers and virtually all of the child care workers earning wages of $5.00 an hour or less. Longer job tenure- that is, experience is not substantially rewarded for child care workers. Hourly wages of workers with 4 or more years of experience average $3.45 per hour, only slightly more than the average of those with 3 years or less on the job, $3.19 per hour (Hartmann and Pearce, 1989~. There is also little wage increase for educational achievement: child care workers who are college graduates received only $3.73 per hour; high school graduates received $3.02 per hour. Data concerning the income of family day care providers are more difficult to obtain. The National Day Care Home Study reported that the net weekly incomes of family day care providers in 1978 ranged from $50 to $62. No national updates of this information are available, but Kahn and Kamerman (1987) indicate that local surveys in 1984 found little relative improvement. A recent study of the Child Care Food Program found that among licensed family day care providers participating in the program, the household incomes of workers varied from less than $9,000 to more than $20,000 per year and that the proportion from child care work was inversely related to the total. Approximately 77 percent of workers who reported household incomes of less than $15,000 derived 100 percent of their income from their child care work (Glantz et al., 1988~. Kahn and Kamerman (1987) conclude that most family day care providers are earning less than the minimum wage in caring for the children of other low-income earners. And even the lack of taxation on these wages does not make the weekly or annual net incomes competitive with low-paying jobs covered by . . mmlmum wage aws. Researchers, administrators, and child care workers point to low pay, poor benefits, and lack of opportunities for promotion as explanations for high turnover rates among child care workers in centers and Head Start programs (Hartmann and Pearce, 1988; National Association for the Education of Young Children, 1985; Phillips and Whitebook, 1986; Whitebook et al., 1989; Zinsser, 1986~. Using a variety of data, Hartmann and Pearce (1988) found that, between 1983 and 1986, child care workers' salaries failed to keep pace with rising prices. In addition, one-third to one-half of caregivers in social service and private educational settings did not have any health insurance coverage provided by their employers, even if they worked full time. And many did not receive paid time off for

180 WHO CARES FOR AMERICA '5 CHILDREN? holidays and vacations. Turnover rates have been found to be as high as 41 percent annually in some localities and among some types of providers (Whitebook et al., 1989~. In conducting the National Child Care Staffing Study, Deborah Phillips (University of Virginia, personal communication, May 23, 1988) reports that it was not uncommon to find that, in the one week between the time interviews were scheduled and researchers arrived at the centers, staff had left. Although it has often been assumed that child care workers are more motivated by their love and concern for young children than by their concern about remuneration, low pay and poor benefits are clearly factors that drive many qualified staff from these jobs (Hostetler, 1984; Pettygrove et al., 1984~. Data from several studies confirm that as salaries rise, turnover rates decrease (Goodman et al., 1988; Pettygrove et al., 1984; Zinsser, 1986~. In Massachusetts, for example. Head Start programs were allocated approximately $359.67 Per --r--~ ~ r--o~ --or---- ---a ~ r child for staff raises, and the state established suggested hourly minimum wages for many Head Start positions. A recent study examining the impact of state supplemental funding found that the grants had increased staff wages and benefits, as well as job satisfaction. Moreover, the findings suggested that the grants have had a positive effect on staff recruitment and retention (Goodman et al., 1988~. Interviews with Head Start teachers who are leaving their jobs, as well as with those who are still working in child care centers, confirm that many leave for higher paying jobs in public schools or in other fields, including jobs that require much less formal education and specialized training (Goodman et al., 1988~. As we noted above, there is some concern that public schools will drain the pool of qualified staff from child care services as they increase their role in the provision of early childhood education and child care programs. Alternatively, competition for a limited pool of staff may put pressure on child care providers to reach some parity with schools in staff salaries and benefits, but that will not occur without effects on the cost of care and the fees that are charged to parents. Some of the differences in the salaries of early childhood staD reflect differences in their levels of education. As we discussed above, most teachers in public school prekindergartens have college degrees (Marx and Seligson, 1988~. Although some Head Start teachers also have bachelor's degrees, many do not (Goodman and Brady, 1988~. Head Start is governed by the state licensing requirements for child care programs, and although many states require specialized training and experience, none requires a bachelor's degree. Recent national data suggest that 57 percent of teachers and assistants in licensed child care centers have high school diplomas, and many have credentials through the CDA program; only a minority hold college degrees (National Association for the Education of Young Children, 1985; Whitebook et al., 1989~. And family day care providers on average

CHILD CARE SERVICES 181 have even fewer years of formal education; many have not even graduated from high school (Fosburg, 1981~. The institutional auspices of child care workers may have more to do with income levels than their education. Salaries in education, although low, have traditionally been higher than salaries for social services positions, even when levels of education are comparable. Child care workers employed by schools consistently earn more than those in nonschool settings. In addition, working in the public sector pays better than working in the private sector. Not-for-profit centers pay teachers and assistants more on average than do for-profit centers, with chain for-profit centers having the lowest average wage, $4.10 per hour. For-profit centers also provide fewer benefits, such as health coverage, retirement, and sick leave. As a consequence, for-profit centers have significantly higher turnover rates, up to 74 percent annually in some national chains (Whitebook et al., 1989~. Education does not account for the differences in earnings between early childhood staff and individuals in other occupations. Because child care has traditionally been a woman's responsibility and an unpaid home function, Hartmann and Pearce (1989) and Whitebook and colleagues (1989) in the Child Care Staffing Study concluded that salary differences between child care workers and other occupations requiring comparable levels of education and training are attributable to gender discrimination and to the low value placed on child care as paid work in U.S. society. The lack of professional stature accorded to early childhood staff is partly a problem of societal perception and partly a problem of the perception of many child care workers themselves. Low salaries have undoubtedly contributed. Unfortunately, a prevailing view from outside and within is that if a child care worker really enjoys the work, the money should not be important (Goodman et al., 1988~. Moreover, many child care workers have had a tenuous attachment to their careers. Many women regard child care as an interim activity, between the end of their schooling and the time that they get married and start their own families, or during the period when their own children are very young, or while they are serving as the primary caregiver for a grandchild or other relative. Explicit or implicit attitudes that child care is a temporary means of earning some "extra money" have militated against many workers seeking professional credentialing through the CDA program or some other early childhood education program or in seeking in-seIvice training. Many observers also believe that professional training may be one key to improving the quality of early childhood staff (Army, 1982~. One path to greater professionalism is unionization. Unions are com- mon among public school teachers (who do receive higher salaries and better benefits), but there has been only modest movement to date to unionize workers in child care centers. Yet unionization is not an unlikely

182 WHO CARES FOR AMERICA'S CHILDREN? direction. Although many early childhood experts express concerns about the effects of unions on the nature of the intimate relationships between staff, parents, and children in child care (Army, 1982), working in union- ized settings is associated with improved working conditions and reduced turnover, as is working in the public sector (Hartmann and Pearce, 1989~. Child care workers in the public sector earned over $1.00 more per hour than those in the private sector. Employees who were union members earned an average of $5.21 more per hour than their nonunion counter- parts. The increase in salary is due to both union membership and setting (Hartmann and Pearce, 1989~. Regulations As we have discussed, regulation of child care services is the province of the states. Although states vary dramatically in the stringency of their requirements, with a few exceptions there has been a general gradual trend toward tighter regulations since the mid-1970s. However, different types of programs are governed by different regulatory authorities, and some providers are exempted because of the auspices under which they operate or the number of children they serve. In addition, enforcement systems have not grown proportionately to the growth in out-of-home child care services. As a result, very real questions have been raised about the effectiveness of regulation as a means of ensuring the quality of care in child care centers and in family day care homes, even in jurisdictions in which such care is regulated. Since the early 1980s, discussion of regulation has increasingly included consideration of alternatives to regulation, especially for family day care homes. Some child care advocates who urge stringent regulation of child care services have opposed low standards and lax enforcement because of the pernicious effects of poor-quality care. They cite cases of child abuse and fundamental health and safety violations in unregulated or laxly regulated environments. In response, opponents of state regulation have argued that government interference in the private decisions of families is neither a benefit to parents nor necessarily a protection to children; that "excessive" regulation increases the cost of care and provides disincentives for many providers to become a part of the licensed system; and that, in the absence of effective enforcement, regulation does not ensure that consumers receive high-quality care. The existence of regulations does not guarantee their adequate and fair enforcement, and programs are rarely closely monitored. Most centers receive an annual announced visit (Morgan, 1987~. The personnel who conduct these visits are often overburdened and poorly trained. Although there has been a rapid increase in the number of licensed programs, there

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.

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~.

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

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,

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

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~.

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.

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.

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.

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.

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. -

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Few issues have aroused more heated public debate than that of day care for children of working parents. Who should be responsible for providing child care—government, employers, schools, communities? What types of care are best?

This volume explores the critical need for a more coherent policy on child care and offers recommendations for the actions needed to develop such a policy.

Who Cares for America's Children? looks at the barriers to developing a national child care policy, evaluates the factors in child care that are most important to children's development, and examines ways of protecting children's physical well-being and fostering their development in child care settings. It also describes the "patchwork quilt" of child care services currently in use in America and the diversity of support programs available, such as referral services.

Child care providers (whether government, employers, commercial for-profit, or not-for-profit), child care specialists, policymakers, researchers, and concerned parents will find this comprehensive volume an invaluable resource on child care in America.

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