Child development experts say high quality child care can help children avoid problems later in life - from low achievement in school to arrest records. The problem is that the children who need this care the most can't get to it.
Minnesota is trying a new approach by turning to the marketplace and betting that well-funded scholarships for poor children will attract high-quality daycare. The program is not the brainchild of an early childhood expert, but rather of an economist who says this is a good investment that will save the state money.
From his office in the Federal Reserve Bank of Minneapolis, economist Art Rolnick will almost be able to see construction of the new baseball stadium which the city has agreed to build. And if the Vikings get their wish, there will also be a football stadium. As for the economic gains the Twin cities will reap from these projects? "For stadiums, the public return is virtually zero," Rolnick says.
As the director of research for the Federal Reserve Bank of Minneapolis, Rolnick believes there is a much better way to invest those hundreds of millions of dollars: Give the money to city's youngest and poorest residents.
That way, Rolnick says, they can send their 3- and 4-year-olds to a high-quality early-education program in their community.
The government already invests in early education through Head Start, but according to Rolnick, the Head Start program has brought only a limited return on investment because the quality isn't high enough.
Rolnick wants to spend a large amount of money on scholarships — about $10,000 per child. It's not welfare, he says, but rather an economic effort to seed the clouds, to lure the very best daycare — the kind middle-class parents take for granted — to the city's poorest neighborhoods.
Rolnick and others convinced local corporations they had a stake in improving outcomes for poor children. The private sector is chipping in $15 million dollars to fund the scholarships.
On a rundown corner in St. Paul's North End, there is a tired-looking cinder block building that currently houses the Empire Clock Co. It doesn't exactly look like prime real estate, but this building will soon be transformed into the newest location of New Horizon Academy, a childcare chain with 51 locations in Minnesota.
New Horizon Academy CEO Chad Dunkley says the main reason he's thinking about opening a center here is that parents in the neighborhood will soon be able to afford good daycare, thanks to the early learning scholarships.
In recent years, Dunkley has had to close programs because state reimbursement for child care has dropped. But for Art Rolnick's vision, Dunkley's company is the poster child of how to increase the supply of quality childcare.
Dunkley says this North End neighborhood has one of the highest densities of children below the age of 5. "But because current existing state funding resources don't allow families access to high-quality programs, we want to provide [it] in this community," he says. "We know the kids are here, they just couldn't get to us until this scholarship program became available."