Infant Toddler Rate Increase
October 2010
Infant Toddler Rate Analysis
Based on the analysis of rates for educators in infant and toddler programs,
and in alignment with the implementation of multiple Department initiatives
focused on this age group, EEC proposes a 3% increase to rates paid to
educators serving infants and toddlers in Massachusetts. Upcoming
initiatives with increased expectations of educators include:

The Development of Infant and Toddler Learning Guidelines
These Guidelines are intended for all types of early education and care settings that
care for children from birth through thirty-six months of age. They describe how
programs and educators can best support the healthy development of infants and
toddlers. They are structured to facilitate their use for professional development,
are aligned with EEC’s existing Preschool Guidelines for Three and Four Year Olds
and with the EEC Core Competencies. They address brain development, emphasize
relationships as a key factor across all development domains, and reflect values
inherent in a strength based approach.

Birth to School Age Task Force Report Recommendations
Multiple recommendations speak to the need to for increased compensation for
providers and for quality services for infants and toddlers.

Quality Rating and Improvement System (QRIS)
Includes standards for increased qualifications for staff in high quality programs.
2
Infant Toddler Rate Analysis

Objective:
 Recommend to Board rate increase that:
1.
2.
3.
4.

The 2009 Child Care Market Survey results indicate EEC rates are
significantly below median by region & type of care.

The six regions percentage variance to median ranges are:
1.
2.

Center Based Child Care Blended Rate Ranges: 5.05% to 20.47%.
Family Child Care Rate Ranges: 5.94% to 33.94%.
EEC reviewed various rate scenarios
 Assumptions:
1.
2.
3
Reduces the gap between EEC Rates and Market Median.
Rate increase falls within available funding & budget
constrictions.
Rate increase is sustainable.
Maintain rates by region.
Blended Infant/Toddler rate used for region & type of care.
FY2010 average headcount was used to calculate forecasted
spending to account for attrition.
Infant Toddler Rate Analysis

EEC reviewed various rate scenarios
 Results:
1.
2.
3.
4.
5.
In order reduce the gap between the current EEC Rate &
Market Survey Median the percentage increase would vary
between region & type of care.
We reviewed percentage increases ranging from 1% to 12%.
Two of the six regions, Northeast and Greater Boston center
based blended rate currently has the largest gap to the
median and current child care rate is highest.
Three regions Northeast, Greater Boston and Boston family
child care blended rates have significant variances to the
median and also have the highest child care rate.
Annualized dollar impact at 3% increase ranges from
approximately $4.2 to $5.0 million.
Note: Projected dollar spending increase is dependent on no. of
children & infant/toddler headcount mix and the rate
(blended rate and/or Infant & Toddler individual rates)
that the percentage increase is applied.
4
Infant Toddler Rate Analysis
Linking Infant Toddler Rate Increase to Quality
Recommendation:
Link the 3% infant toddler rate increase to the Quality Rating and Improvement
System (QRIS), as follows:
Fiscal Year Activity
FY2011
• Any program serving EEC supported infants and toddlers that is interested in
the 3% rate increase would be required to provide a self assessment of their
programs quality by participating in the FY2011 QRIS (January - March 2011).
• Programs would be required to advance at least one level on the QRIS in 18
months to receive additional rate increase funding (January 2011 – July 2012)
• Consider possible exemptions to maximize participation (e.g. Professional
Development standards that cannot be made within the 18 month timeline)
• Participation in QRIS would be program-wide (not infant and toddler classroom
based).
• Rate increase would not be available until on or after March 2011.
5
FY2012
Revisit decision with current data and identify requirements for receiving a
potential rate increase in FY2013
FY2013
To sustain or receive rate increase funding, all EEC supported programs serving
infants and toddlers must be a verified QRIS Level 3 or 4.
Infant Toddler Rate Analysis
Region
EEC Rate
Blended Rate
Market
Survey
Median
Blended Rate
Recommended
Daily Rate
3% increase
1 - Western
SFY 2011
6 Mths.
FFY 2011
*
9 Mths.
*
Annualized
$ Impact *
2,235
$
338,728
$
512,030
$
685,333
$46.97
1,306
$
230,472
$
348,389
$
466,305
$32.00
$31.00
929
$
108,255
$
163,642
$
219,028
1,455
$
211,022
$
318,987
$
426,952
$46.70
$52.00
$48.10
555
$
100,335
$
151,669
$
203,003
$31.80
$36.50
$32.75
900
$
110,688
$
167,318
$
223,949
2,779
$
415,097
$
627,473
$
839,848
- Center Based Child Care
$45.60
$48.69
- Family Child Care
$30.10
- Center Based Child Care
- Family Child Care
2 - Central
3 - Northeast
- Center Based Child Care
$52.30
$63.50
$53.87
949
$
192,011
$
290,249
$
388,488
- Family Child Care
$31.50
$39.00
$32.45
1,830
$
223,086
$
337,223
$
451,360
967
$
184,343
$
278,658
$
372,973
661
$
143,654
$
217,151
$
290,648
4 - Greater Boston
- Center Based Child Care
$56.15
$70.60
$57.83
- Family Child Care
$34.35
$52.00
$35.38
5 - Southeast
306
$
40,689
$
61,507
$
82,324
2,452
$
401,318
$
606,643
$
811,968
- Center Based Child Care
$46.05
$48.50
$47.43
1,808
$
322,165
$
486,994
$
651,823
- Family Child Care
$31.80
$40.00
$32.75
645
$
79,152
$
119,648
$
160,145
3,027
$
499,570
$
755,164
$
1,010,758
- Center Based Child Care
$51.50
$58.50
$53.05
1,687
$
336,228
$
508,251
$
680,274
- Family Child Care
$31.50
$31.50
$32.45
1,340
$
163,343
$
246,913
$
330,484
12,915
$
2,050,078
$
3,098,954
$
4,147,831
6 - Boston
* 3% increase over current blended rate.
6
Average
Headcount
FY2010
Impact to Headcount
• Recommendation:
 In order to sustain the Infant Toddler rate increase in subsequent fiscal
years a reduction to the number of Infant/Toddler, Preschool and School
Age Children may be necessary if additional funding is not available.
 Approximately 617 children reduction on average for all age groups will
be needed to offset proposed increase in Infant /Toddler rate to be
effective and completed by 10/1/2011.
1.
2.
3.
4.
Use attrition to manage reduction
Temporarily close wait list
617 children reduction to be effective and completed by 10/1/2011
Reduction will be proportionate to average headcount in all programs
funded by vouchers:
Child Care Funded by Voucher Program
Infant Toddler
Preschool
School Age
7
24.83%
29.66%
45.51%
100.00%
$
1,029,886
1,230,321
1,887,625
4,147,832
HDC
93
159
364
617
Infant Toddler Rate Analysis
Below is an example of a center based program’s revenues/expenses from one of
their Infant/Toddler Classrooms. In this program, EEC revenues total $84,994
annually, while expenses total $119,518, for a total loss of $34,524 annually
($4,951/child). This program serves eighty-seven EEC funded Infants and Toddlers,
which reflects a total annual loss of $430,737 to provide these services.
Current Annual Revenue/Classroom
# of Children
Rate per Day
$46.70
7
# Days
Total
260
$
84,994
Expenses
Staffing
8
Lead
Teacher
Teacher
Site Mgmt.
Benefits @
20%
Occupancy
Maint. &
Utilities
Mortgage Int.
Office Costs
Phones,
Computers,
Liability Ins.,
etc.
Supplies
Training
Depreciation
General Admin.
$
$
$
$
31,200
24,960
24,960
6,000
$87,120.00
$17,424.00
$ 2,500.00
$ 1,400.00
$ 2,000.00
$
800.00
$
750.00
$ 2,000.00
$ 5,524.61
Net Loss
Net Loss/Child/Day
Net Loss/Child/Year
$ 119,518.61
$ (34,524.61)
$
(18.97)
$ (4,951.06)
Infant Toddler Rate Analysis
Below is a second example of a center based program’s revenues/expenses from one
of their Infant/Toddler Classrooms. In this program, EEC revenues total $106,704
annually, while expenses total $155,506 for a total loss of $48,802 annually
($5,422/child). This program serves 147 EEC funded Infants and Toddlers, which
reflects a total annual loss of $$797,098 to provide these services.
Current Annual Revenue/Classroom
# of Children
Rate per Day
9
$45.60
# Days
Total
260
$
106,704
Expenses
Staffing
9
Lead
Teacher
Teacher
Substitutes
Site Mgmt.
Benefits @
25%
Occupancy
(includes
Depreciation)
Office Costs
Phones,
Computers,
Liability Ins.,
etc.
Supplies
General Admin.
$
$
$
$
$
28,000
22,000
22,000
5,775
6,250
$84,025.00
$21,006.00
$30,550.00
$ 1,950.00
$ 2,975.00
$15,000.00
Net Loss
Net Loss/Child/Day
$
$
$
155,506.00
(48,802.00)
(20.86)
Net Loss/Child/Year
$
(5,422.44)
Infant Toddler Rate Analysis
Below is a third example of a center based program’s revenues/expenses from one of
their Infant/Toddler Classrooms. In this program, EEC revenues total $93,985
annually, while expenses total $106,499 for a total loss per ($1,390/child).
Current Annual Revenue/Classroom
# of Children
Revenue EEC
Dept of Education
Rate per Day
7
7
$46.70
$4.94
# Days
260
260
Total
84,994
8,991
Expenses
Staffing
$
Lead Teacher
Teacher
Teacher
Site
management
Benefits
Occupancy
(includes
Depreciation)
$
$
$
29,432
17,680
14,677
$
4,102
$65,890.62
$13,178.12
$ 8,667.50
Direct Expenses
(food,supplies,t
raining)
$ 9,835.35
General Admin.
$ 8,927.18
Net Loss
Net Loss/Child/Day
Net Loss/Child/Year
10
93,985
$
$
$
$
106,498.77
(12,513.97)
(6.88)
(1,390.44)
Infant Toddler Rate Analysis
Infant/Toddler
CLASSROOM
BUDGET
COST CATEGORY
Personnel
FTE
Annual Basis 1=40 hrs/wk
Program Director
Program Assistant
Lead Teacher
Teacher
50,000.00
30,000.00
35,000.00
30,000.00
0.20
0.20
1.00
1.00
Teacher Assistant
Total Salaries
25,000.00
0.80
$
10,000
6,000
35,000
30,000
Assumes a 5-classroom center, hence a 20% allocation per classroom.
Assumes a 5-classroom center, hence a 20% allocation per classroom.
Part time teacher provides coverage for lunch / breaks and accommodates the 10-hour
service day.
$
20,000
101,000
$
28,785
Fringe includes FICA at 7.65%, Unemployment at 2%, WC at 1.5%, Health Insurance at
13%, Dental at 1%, Life/Disability at .35%, Retirement @ 3%.
Teacher Substitutes
$
11,424
Each teacher receives 30 days of compensated absences a year Vacation = 15, Sick =
12, Personal = 3. Substitute coverage is estimated at 240 hours per FTE at a rate of
$17 per hour.
Total Personnel
$
141,209
Other Operating Costs (ODC's)
$
5,400
Facilities/Occupancy
$
16,875
Total Direct Costs (TDC)
$
163,484
15% $
24,523
$
188,007
Fringe Benefits
28.5%
General Administrative (G&A)
Overhead
Total Annual Cost Per Classroom
Number of Children per Classroom
11
COST ASSUMPTIONS
Other operating expenses (i.e., supplies, training, equipment, rental,
telecommnuication, printing etc. ) are estimated at $600 per child)]
Facilities cost is estimated at $25 per Gross Square Foot. Base rent is estimated at $15
SF; Facilities operations (i.e. depreciation, utilities, cleaning, expendable repairs &
maintenance, and property & general liability insurance, etc.) is estimated at $10 SF.
GSF per child is $75.
G&A overhead includes CEO, Accounting, HR,IT and Facilities Management. G&A is
estimated here at 15% of Total Direct Costs (TDC).
9
Annual Cost per Child
$
DAILY COST PER CHILD
$
Current EEC Infant/Toddler Rate for Region 6
$
20,890
80.04
51.50
Assumes 261 service days per year.