financial pressure

Closure of Clayton Early Learning center in far northeast Denver exposes pain points in early childhood care

Preschoolers play at Clayton Early Learning in 2015.

When the news broke last week that Clayton Early Learning planned to shutter its child care center in Denver’s Green Valley Ranch neighborhood, dozens of parents voiced anger and surprise as they scrambled to line up new child care arrangements.

Behind the scenes, local and national early childhood advocates also took note.

Suddenly, one of the most well-respected names in early childhood education was downsizing. After just four years, Clayton was leaving an underserved city neighborhood, ending service for middle class tuition-paying families and retreating from its aspiration to provide quality child care to a mixed-income population.

“That is not a decision that we wanted to have to come to,” said Clayton’s President and CEO Charlotte Brantley. “We don’t believe it’s the right way to go to segregate kids based on their race, income or anything else.”

The move, however, illustrates just how financially tenuous the child care business can be — even for the biggest players in the game.

“It is concerning for Clayton, being a really well-known, high-functioning provider, to not be able to make it work,” said Emily Bustos, executive director of Denver’s Early Childhood Council.

Clayton, whose flagship school in northeast Denver is part of the national Educare network of child care centers serving at-risk children, doesn’t look like a place with money worries. Stately buildings dot its 20-acre campus, which long ago housed a boys orphanage and school. The organization also owns the 155-acre Park Hill Golf Club, which brings in about $650,000 a year after expenses.

Still, Clayton leaders and industry experts say top-notch child care is extremely expensive — costing tens of thousands of dollars a year per child. And help from government coffers is lagging.

“It’s an example of how underfunded high-quality programs in early childhood are,” said Cheryl Caldwell, director of early childhood education for Denver Public Schools.

Said Brantley: “The industry runs on an absolute shoestring budget.”

While Clayton is closing its far northeast Denver location, many of the approximately 100 children served there will be allowed to transfer to Clayton’s flagship campus on Martin Luther King Boulevard because they qualify for federally funded Head Start or Early Head Start. By combining Head Start funds with Denver Preschool Program funds and state money available to low-income families, the school can cover the cost of those slots more easily.

Up to 43 children, half of them infants or toddlers, will lose their spots at Clayton after Aug.18. They include 25 tuition-paying children at the main campus, three tuition-paying children at the far northeast site and possibly up to 15 low-income children at both sites who currently get state child care subsidies. Some of 15 children may be eligible for Head Start, which would allow them to stay at Clayton.

The closure will hit families with infants and toddlers particularly hard because there’s a chronic shortage of quality care for children that age in Denver.

While displaced preschoolers will probably be able to find other arrangements, “The infants and toddlers … they have basically nowhere to go,” Brantley said.

Some tuition-paying parents expressed their frustration at Clayton officials for not having being more proactive in addressing the financial challenges.

“You are the caretaker for the families because we don’t work with the budget,” Nate Paul, who has a 17-month-old in care at the main campus, and is expecting a baby who is already on the Clayton waitlist, told school officials at a recent meeting. “We don’t know what the cost per head is. We don’t have our hand on the gears and levers. You do. Your job is to make Clayton sustainable.”

Ryan Walsh, a father of two children served at Clayton’s main campus, said, “We’re not just a bunch of noise-making, smear campaign kind of people. We actually advocate for early childhood education, and this situation doesn’t benefit the community as a whole when we’re talking about early childhood and education funding advocacy in general.”

Brantley said about 30 staff members at the far northeast location will be able to transfer to jobs at the main campus, though some may take on somewhat different roles.

After operating its flagship campus for decades, Clayton Early Learning opened its second location in a building called Z Place in the Green Valley Ranch neighborhood in early 2013.

The additional space allowed both sites to begin accepting tuition-paying families. They had access to the same raft of benefits that Clayton’s Head Start families and those eligible for state child care subsidies did— small class sizes, extensive special services and lots of parent support.

But tuition — currently about $1,000 a month for full-day preschool and about $1,200 a month for full-day infant/toddler care — never covered the true cost of all that was provided, Brantley said.

Clayton covers $200,000 to $300,000 each year to close the gap between what tuition covers and what the program actually costs, Brantley said.

School officials launched the new location knowing that, but they hoped that more public funding would be coming to the early childhood field. At the time, a campaign was underway for a statewide ballot initiative that would raise millions for education, including preschool and full-day kindergarten. Voters soundly rejected the measure in November 2013.

There were other setbacks. In 2014, Colorado lost its bid for a federal grant that would have paid for new state preschool slots. Clayton would have been a partner in the effort.

Brantley said the state legislature’s perennial reluctance to increase education funding, combined with uncertainties about what will happen to federal early childhood funding under the Trump administration’s budget, also factored into the discussion to close the far northeast location.

In the midst of the deliberations, Clayton leaders learned that two separate grants that help fund other parts of the organization’s work — weekly “play and learn” groups for kids and caregivers, and coaching for other child care providers — would not be renewed.

“It’s this multitude of things that crashed together all at once,” said Brantley. “This was an incredibly difficult and disappointing decision to have to come to.”

Although Clayton owns the Park Hill Golf Club land and is in the midst of deciding whether and how to redevelop it, Brantley said it wouldn’t solve the problem of the far northeast site. For one thing, it will remain a golf course at least through the end of 2018, meaning no additional revenue is expected any time soon. In addition, any revenue from it would also need to support other aspects of Clayton’s large operation, which includes research, training and coaching.

Brantley said the fate of the seven classrooms at Z Place became clear in the spring as school leaders were developing the budget for the fiscal year that began July 1. The board voted to close the far northeast site in June.

Some of Clayton’s tuition-paying parents argued that they would have been willing to pay more if only school leaders had asked. But Clayton officials say the gap was too large.

Mike Burke, vice president of the Buffett Early Childhood Fund, a national Educare partner, said that he understands the parents’ instinct, but that it probably wasn’t a realistic request.

“An organization of Clayton’s caliber would have made it work if they could,” he said.

Educare programs have very robust staffing models “where you’re paying for degreed professionals, you’re paying for one, two, three teachers in the classrooms, family support workers, nurses, mental health consultants, speech and language consultants,” Burke said.

“When you start piecing it all together, you can see these cost-per-child averages raising, raising, raising.”

Burke said only a few of the country’s 21 Educare schools, including those in Miami, Maine and suburban Chicago, have classrooms that include children from tuition-paying families. But in most cases, it’s small-scale integration — only about 10 children.

Research on mixed-income preschool classrooms shows that such diversity has a positive influence on language development and social and emotional skills of low-income children. But Burke said early childhood financing structures aren’t set up to encourage socioeconomic integration because they come with strict eligibility requirements, often based on family income.

Locally, Mile High Early Learning, which like Clayton focuses on serving low-income families through Head Start and Early Head Start, draws around 7 percent of its 500 children from tuition-paying families.

But Pamela Harris, the organization’s executive director, knows how hard the balancing act is. Leaders there recently increased monthly tuition from $1,400 to $1,700 after a year of discussions.

That said, there’s still an invisible subsidy at work, Harris said — the discount that comes from paying child care workers a relatively low wage. Some in the field make so little they qualify for government assistance.

Overall, Harris believes there’s been progress on the early childhood front — gradual growth in Colorado’s state-funded preschool program, a new focus on early education in the federal Every Student Succeeds Act, and local efforts to connect the birth to five age span to the K-12 education system.

Against that backdrop though, Clayton’s plan to close its far northeast site “exposes the pain points that are still in early childhood,” she said.

Enter to win

Denver organization to launch national prize for early childhood innovation

PHOTO: Ann Schimke

A Denver-based investment group will soon launch a national contest meant to help scale up great ideas in the early childhood field — specifically efforts focused on children birth to 3 years old.

Gary Community Investments announced its Early Childhood Innovation Prize on Wednesday morning at a conference in San Francisco. It’s sort of like the television show “Shark Tank,” but without the TV cameras, celebrity judges and nail-biting live pitch.

The contest will divvy up $1 million in prize money to at least three winners, one at the beginning stages of concept development, one at a mid-level stage and one at an advanced stage. Gary officials say there could be more than one winner in each category.

The contest will officially launch Oct. 25, with submissions due Feb. 15 and winners announced in May. (Gary Community Investments, through the Piton Foundation, is a Chalkbeat funder.)

Officials at Gary Community Investments, founded by oilman Sam Gary, say the contest will help the organization focus on finding solutions that address trouble spots in the early childhood arena.

The birth-to-3 zone is one such spot. While it’s an especially critical time for children because of the amount of brain development that occurs during that time, it’s often overshadowed by efforts targeting 4- or 5-year-olds.

Steffanie Clothier, Gary’s child development investment director, said leaders there decided on a monetary challenge after talking with a number of other organizations that offer prizes for innovative ideas or projects.

One foundation they consulted described lackluster responses to routine grant programs, but lots of enthusiasm for contests with financial stakes, she said.

“There’s some galvanizing opportunity to a prize,” she said.

But Gary’s new prize isn’t solely about giving away money to create or expand promising programs. It will also include an online networking platform meant to connect applicants with mentors, partners or investors.

“We’re trying to figure out how to make it not just about the winners,” Clothier said.

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Public investment

This Colorado ski town had an early childhood education crisis. Here’s what local leaders did about it.

PHOTO: Ann Schimke

Greta Shackelford moved to Breckenridge 13 years ago on a whim. She was young and single at the time — a Virginia native enjoying life in a Colorado ski town.

Today, Shackelford is married with two young children and heads a local child care center called Little Red Schoolhouse. She’s also one beneficiary of Breckenridge’s decision a decade ago to pump hundreds of thousands of dollars annually into the town’s child care industry.

Back in 2007, she got a substantial raise when town officials boosted salaries for local child care teachers by 30 percent and today, she and her husband, a general contractor, get help covering preschool costs for their 3-year-old son and 4-year-old daughter. In addition, because the town helped pay off some centers’ mortgages, there’s a financial cushion in case the boiler breaks or the roof leaks at Little Red Schoolhouse.

The effort in Breckenridge is among a growing number of initiatives across the state that use public money — usually gleaned from local property tax or sales tax — to improve child care and preschool options. Beyond helping prepare young children for school, these initiatives can be a vital cog in the local economy, keeping parents in the workforce and businesses adequately staffed.

And more could be coming soon. Leaders in San Miguel County, where Telluride is the county seat, are gearing up for a November ballot initiative that would help expand child care facilities and boost teacher pay. In Estes Park, advocates are just beginning a process to determine the town’s child care needs and explore funding options.

“It’s because some child care deserts are seemingly insurmountable and entrenched that local leaders in early childhood are looking at all possibilities,” said Liz Houston, executive director of the Early Childhood Council Leadership Alliance.

Experts say local efforts can be a heavy lift for community leaders charged with galvanizing support for tax hikes or other publicly funded proposals. But when successful, they provide much-needed stability to an industry plagued by low pay, high turnover, a shortage of slots and wide variations in quality.

Leaders in Breckenridge say child care is just as critical as plowing snow.

“Just like we need to plow our roads so people can get to our ski area, … this is just as important,” said Jennifer McAtamney, the town’s child care program administrator. “If we lose our workforce, it’s a huge problem.”

Some early childhood leaders hope these locally-funded projects can serve as a stepping stone to more ambitious statewide efforts in the future. (The state already runs programs that provide half-day preschool to at-risk children and child care subsidies for low-income families, but demand far outstrips supply.)

“Support for early childhood education is probably going to be built community by community by community until there is enough of a groundswell for it to be something that is statewide or nationwide,” said Jennifer Landrum, president and CEO of the Denver Preschool Program.

Like in Breckenridge, government funded early childhood initiatives have existed for years in Denver, Aspen, Boulder County and Summit County. A couple others — in Dolores and Elbert counties — have launched more recently, according to a list maintained by the business group Executives Partnering to Invest in Children, or EPIC.

One of the factors that unites communities that have taken on locally funded early childhood initiatives is a sense that things were at or near a crisis point. In Colorado’s resort towns, where many describe the cost of housing and other basics as astronomical, this is especially true.

Early childhood advocates in these communities can rattle off numbers that illustrate just how hard it is to find quality child care: waitlists that run into the hundreds, towns with few or no licensed slots for babies, centers that can’t find child care workers to staff their classrooms.

Shackelford, the director of Little Red Schoolhouse in Breckenridge, said the town’s effort, which includes another cash infusion to boost salaries in 2018, has reduced employee churn. Her own experience is a case in point.

Without the town’s financial help — with both child care and housing — “we would never have been able to afford to stay in Breckenridge,” she said. “It makes it, not cheap, but manageable.”

Gloria Higgins, president of EPIC, expects the number of municipalities that take on locally funded early childhood efforts to go up over the next decade.

By then, she said, “those communities in the most distress will probably have something and those are the mountain resort communities … They’re going to lead.”

But she also expects cities like Pueblo and some in the Denver suburbs to hop on board, too.

Higgins is an enthusiastic evangelist for such efforts. They fit well with Colorado’s local control ethos and can be tailored to each community’s needs. Still, she cautions those interested that it takes about four years of planning to get the job done.

“It’s a big deal to get the taxpayer to say yes,” she said.

While voters are often called on to approve dedicated sales tax or property tax hikes, some communities have earmarked public money for early childhood in other ways.

In Breckenridge, for example, the town council initially allocated money for its early childhood program from the general fund, a move that didn’t require voter approval. Six years in, the town did ask voters for a property tax increase to support the program, but the measure failed.

The council subsequently decided to continue funding the effort as before.

In Elbert County, a partnership between early childhood leaders and county human services officials led to a special grant program that pays for preschool scholarships for low-income children stuck on the waitlist for state-funded slots.

Cathryn Reiber, coordinator of the Elbert County Early Childhood Council, said that in an ultra-conservative community where new tax increases would never pass, the county partnership has been a great solution.

Landrum, who heads the Denver Preschool Program, said it’s also important to win backing from the business community. After two defeats at the ballot box in the early 2000s, business leaders helped shape and endorse sales tax measures to fund the program in 2006 and in 2014.

In addition to providing preschool tuition assistance for the city’s 4-year-olds, the Denver Preschool Program provides training, coaching and materials for child care providers.

In some communities, funding for early childhood services is one piece of a broader package. In 2010 when the Great Recession was in full swing, Boulder County officials asked voters to approve a five-year property tax hike billed as a temporary safety net measure that would help families afford food, shelter and child care.

Voters said yes, and when officials came back to them in 2014 for a similar 15-year measure, they said yes again. The second time around, the campaign was called “Neighbors Helping Neighbors,” drawing on the community camaraderie that developed after the 2013 floods, said Bobbie Watson, executive director of the Early Childhood Council of Boulder County.

“You have to frame it so your community will bite,” she said.