In 1835, movers and shakers in New York City including Mrs. Alexander Hamilton, DeWitt Clinton, Peter Stuyvesant, and Jennie Lind established the nation’s first non profit child care center. The "Society for the Relief of Half Orphan and Destitute Children" was established so that the children of "poor, but worthy parents" who needed to "go to their daily labors" knowing their children "would be trained for some practical, useful course for life" and "taught their duties and responsibilities as members of society." Does this sound familiar? Day Nursery was in good company in the 19^th century, and as I often say, even though societal attitudes have changed, the essence of our work remains the same today.

However, changes in parental interests, public funding, and women in the workforce (70% of mothers with children under age 6 work and need care for their children), are forcing non profits like Day Nursery to rethink the ways they function. We have, through our Strategic Planning process, already dramatically shifted the focus of our services from the neighborhood to the workplace, and continue to seek additional strategies that will ensure Day Nursery’s viability. To explore what lies ahead, we first need to take a look at some current challenges and opportunities confronting us.

• Staffing: One of the most challenging aspects of administering a non profit early care and education program is finding and retaining qualified staff. Often those who apply lack the proper credentials or training – a serious threat to maintaining excellence in programming. To meet rising National Association for the Education for Young Children (NAEYC) standards as well as public school competition and expectations, we must raise our percentage of degreed teachers from 30% - 75% over the next five years. Financial implications for this shift are obvious and staggering.
• Declining public funding: We have a mission to serve low-income children. Fewer and fewer vouchers are available and many families don’t qualify for the decreasing eligibility levels. Many people live on $20-30,000 per year and are considered too wealthy to receive government subsidies. Our philanthropically-based tuition assistance starts at 50% of fee and many can’t afford that, so they are caught in between. We can’t lower the entry level because we can’t raise enough money to cover it, so parents choose unlicensed, unaccredited programs out of necessity. Meanwhile, we have openings in our program.

If there were a "fragility" score for community programs, we would score substantially more fragile this year. Publicly funded markets are now well below the private market rates. (Goddard’s infant fees are $1200/mo. compared to DNA’s $856/mo.)

Decreases in public support have forced non profits to diversify their constituencies. Non profits have had to reach out to fee paying clients to balance their budgets. As a result, currently on average, only 1 in 3 families served by non profit centers fall into the low-income category. What this means is that community non profits look and feel a lot like their for profit counterparts. In 2006 and 2005, the families served by Day Nursery are broken down into four categories:

• Decreasing philanthropic support: With government support shrinking (or at best barely keeping up with inflation), non profits have not been able to make up the difference with charitable individual and organizational giving. There is an increasing amount of competition in the philanthropic sector with a finite pool of available dollars.

A number of factors have come together to shape a significant opportunity for non profits:

• Public awareness of brain research findings pointing to the importance of the early years;
• Concern over the declining skill levels of children coming out of our public schools; and
• Recognition by business leaders of the increasing need for educated workers for tomorrow’s workforce.

These factors have led to an awakening of interest in the early years among lawmakers, philanthropists, and business leaders. As a result, in the majority of states there is some form of initiative being implemented or planned to fund expansion of pre-K services. Indiana is in the back of the line in this movement, but we do see changes coming, albeit slowly. Warren and Lawrence Townships have preschool centers established and IPS and Pike are experimenting.

Non profits like Day Nursery are greeting this "opportunity" with mixed reviews. On the one hand, all welcome the infusion of much needed, long overdue, new funds into the early care arena. And, if community non profits can insert themselves into these funding streams, this could yield positive results for the organizations and the communities we serve.

On the other hand, there are two concerns if this money flows exclusively through public school channels:

• If public schools start serving all four and five year olds, leaving infants and toddlers to be served by community centers, the economics just won’t work. DNA’s infant and toddler-2’s classrooms have waiting lists. We can’t fill our preschool rooms (where we can make up the dollars we lose on the younger age groups), and currently have over sixty 3-5 year old openings.
• If public schools simply water down rigid academic curriculum approaches for preschoolers, this will not work at the preschool level. Young children don’t learn the way elementary children do, and to force inappropriate styles on them will delay learning progress and create behavior problems.

How this is playing out varies from state to state and community to community. Typically, the new money flows to local public school districts, and these bodies are empowered to contract out to community programs (with varying results to date). An annual forecast prepared by Wilson Marketing Group, an early childhood database and market research firm, predicts that the school-based segment of the preschool market will continue to grow in 2007. According to the forecast, more states are expanding the supply of pre-K and placing greater emphasis on quality. Wilson projects that state pre-k funding will increase 9.7% to $4.6 billion in fiscal year 2007, once again growing at a higher rate than spending for K-12 education. State funding for pre-K has increased 109% since the turn of the century, compared to an estimated 42% increase for K-12 education. In 2007, 29 states plus the District of Columbia will increase pre-K spending.

Here in Indiana, we are all reading daily reports of full day kindergarten funding debates, and the need to reach even further down into preschool programs in the public schools. Local townships have taken the initiative to pilot programs, and even though most do not yet meet the "all day for the working parent" need, and are expensive, they are a significant source of competition for Day Nursery.

What the future holds is far from certain. Looking at the future of our organization, we have three choices when it comes to the pre-K movement:

• We can ignore it. We can view pre-K as a passing fad, not worth getting excited over.
• We can fight it. We can oppose state initiatives to funnel preschool funds through the public schools.
• We can join it. We can get involved in advocating, planning and implementing pre-K programs.

While believable arguments can be made for each of these choices, I think Day Nursery should insert itself into the planning process in Indiana, indeed take a leadership role. I believe we should position Day Nursery to be the provider of choice for these school-based programs so that they remain developmentally appropriate and we are able to continue serving young children. We already believe in and practice partnerships to keep our costs under control and reach the families where they are, and this is simply another partnership.

The bottom line is that non profit early childhood programs need to adjust to the new realities of the world, or be faced with dimming prospects. This means we will need to team up with new players at the state and local levels—players who may have different views on curriculum goals, staff qualifications, and ways of managing organizations. I believe the pre-K initiatives will bring more formality to the non profit early childhood education sector. We will need to operate more like businesses than neighborhood cooperatives. Even though this kind of pressure is challenging, the results can be positive and dramatic in terms of excellence and professionalism. Day Nursery has a 108 year tradition of leadership and advocacy for young children. We cannot give in and give up now because the challenges we face are daunting. This is not a time for us to recede into oblivion, but rather move forward as we have for over a century because young children need what we have to offer them.

Day Nursery Association of Indianapolis, Inc.
615 North Alabama Street, Suite 430
Indianapolis, IN 46204
(317)636-9197
www.daynursery.org