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Education
Child Care and Preschool

One of the most controversial issues in the past few years has been the proper role of the state in providing child-care and preschool opportunities to North Carolina children.

The Smart Start program was intended to be an innovative public/private partnership to facilitate local coordination of children’s services, but the program is mostly state-funded and focuses mainly on the minority of preschoolers in paid child care. North Carolina also affects the market through a tax credit for child-care expenses and through rules on personnel, facilities, amenities, and location of centers and homes that raise the price of care.

Smart Start's Shaky Debut

Smart Start was created in 1993 to help get North Carolina preschoolers ready to learn and thus boost educational performance. Until recently its effectiveness as a school-readiness intervention was impossible to estimate. This has not stopped some politicians from proclaiming Smart Start “successful.” In 1999, for example, Gov. Jim Hunt attributed apparent gains in North Carolina reading scores on 1998 national tests to the existence of Smart Start, even though the highest grade that students from Smart Start-supported preschools could have reached by 1998 was third grade, whereas the reading tests were of fourth graders.

Since early 1998, a number of studies of Smart Start’s impact on school readiness have been published that can provide fair-minded observers with critical information about its effectiveness. Although portrayed by news reports and elsewhere as proving Smart Start’s success, the studies, when closely read, suggest a far different conclusion. The most comprehensive study — published in September 1999 by the Frank Porter Graham Child Development Center at University of North Carolina at Chapel Hill — found that the vast majority of Smart Start expenditures had no statistically significant effect on participants’ readiness to learn in kindergarten.

In 1998, the Graham Center conducted a study of Smart Start in Orange County. A flawed study because it lacked a true control group, it still found no statistically significant impact on non-poor children and a modest gain for poor ones. A more valid study was conducted in 1998 in Mecklenburg County. It found no statistically significant impact on those who spent a single year in a Smart Start center. It did find a measurable gain for kids who stayed in such a center for three years, but once again, the gain was relatively small: 2 percentage points on one measure and 7 percentage points on another. In early 1999 the Graham Center released a study of 200 Smart Start-supported centers; that study showed gains in child care quality but no impact on kindergarten readiness.

The most recent evaluations of Smart Start could not establish causality between the program and developmental and educational outcomes because neither program was evaluated using a random-assignment or “paired county” experiment. The Graham Center’s 2003 evaluation of Smart Start concluded that causality between Smart Start participation, child care quality, and child outcomes could not be established because students were not randomly assigned to control and experimental groups. The most recent evaluation of More at Four, a pre-kindergarten program for at-risk four-year-olds, offered the same warning. According to the More at Four External Evaluation Report for Year 3 (2003-2004), it is impossible to compare the progress between those in the program and those not in the program because of a lack of random assignment.

Due to these severe limitations in research design, researchers are unable to attribute educational or developmental gains to participation in Smart Start or More at Four. Worse, researchers have no plans to conduct new and improved evaluations of student academic preparation for either program.

Preschoolers and Day Care

In North Carolina, most preschoolers do not spend their days in centers or homes where paid staff take care of them (see chart, "Primary Child Care Arrangements, 1993-2002"). Stay-at-home mothers, working mothers and fathers, relatives, and neighbors supply the vast majority of care provided to preschoolers, most on an unpaid basis. State-specific data are harder to obtain, but a study by UNC-CH researchers estimated that about 28 percent of North Carolina preschoolers were enrolled in “regulated child care” (centers or homes) in 2003.

Even for four-year-olds, where the use of formal care is higher (40 percent), the at-risk families targeted by state programs are infrequent users. According to one national study, about two-thirds of mothers who lack a high school degree use no paid day care prior to kindergarten, compared with 22 percent of college graduates. Day care subsidies, teacher training, preschool playground grants, and the like cannot benefit most poor families. Even for day care users, Smart Start grants are a less efficient form of help than simply increasing the value of the subsidies in existence since 1990.

Families are by far the most important providers of preschool services. They do the most to get their children “ready to learn,” whether it be purchasing books, making visits to a doctor, or sacrificing significant income to rear their children at home. All of these investments in child development deserve the same subsidy, if any, given to those who choose services provided for pay outside the home. Furthermore, parents are in the best position to judge the quality of the day care or other services they do purchase for their children. Contrary to popular belief, most families in public opinion surveys say they are satisfied with their day care arrangements.

Recommendations

1. Smart Start and other subsidy programs and tax credits for child-care and preschool expenses should be eliminated in favor of a refundable Smart Start tax credit for preschool children. Parents should also be able to make tax-deductible contributions into Educational Savings Accounts for use in paying preschool expenses or accumulating assets for the future educational needs of their children. For a smaller subset of desperately poor preschoolers who lack functioning parents, a carefully designed state intervention may be justified.
2. Policymakers should limit regulation of day-care operations to health and safety requirements only, letting parents make their own decisions about the trade-off between price and child-staff ratios or qualifications.
3. Yearly evaluations of Smart Start and More At Four should be resumed but redesigned using experimental research methods. In addition, longitudinal studies should be conducted to determine if state pre-kindergarten programs produce lasting social and educational benefits as children progress through school.

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