New Research with Low income families

Falling through the Cracks:
Children in families earning 235%- 300% of federal poverty level at risk of school failure yet families cannot afford quality early learning opportunities for them

Research has shown that quality early education can prepare at-risk children for school so they can close the achievement gap before it begins. Pennsylvania’s early education system has identified one risk factor as children living in families earning up to 300% of the federal poverty level.

One segment of this population– children in families earning between 235% - 300% of the federal poverty level – is at risk for falling through the cracks. Although research shows these children are at risk for school failure, they are not eligible to participate in programs like Head Start or Child Care Works subsidy. They are eligible for Pennsylvania Pre-K Counts, but only four percent of preschoolers currently have access to this program. These families cannot afford to enroll their children in quality early education.

This background document provides specific information about the risk status of these children as well as the family economic conditions.

I. Children Living in Families between 235% and 300% of FPL Are at Risk for School Failure

The National Institute for Early Education Research (NIEER) analyzed economic and child performance data from the Early Childhood Longitudinal Study (ECLS-K) and found a marked performance gap between kindergarten children whose family federal poverty level falls between 235%-300%, and children above the 300% income level.
• Children in this income group are underperforming, compared to their peers from lower income families, in the area of math.
• They are also significantly underperforming compared to their peers with family incomes above 300% of the federal poverty line.
This indicates that this group of children is as much at risk as the children who qualify for programs targeting children below the poverty line.

NIEER found that kindergarten children in the 235-300% poverty band perform significantly lower than children whose family income is above 300% in both math and reading. The size of the gap can be illustrated by expected differences in percentile rankings. For example, the expected change in performance when crossing this income threshold would be like moving a child from the 25th percentile to the 50th percentile in math and from the 25th percentile to the 32nd percentile in reading.

Children in this income band are also at risk for retention in grade during their K-12 school years. According to a NIEER policy brief, 12 percent of children in the middle 60 percent by income families repeat a grade. Although this is lower than the percentage of lower-income children who are retained in a grade (17 percent), the larger size of this population group overall means that the number of children who are retained is greater. “As a result, the success or failure of this group can have a significant impact on state and local education budgets.”

Participation in high quality preschool has been shown to reduce retention in grade; participation in low quality preschool, of the type that parents in this income band may have to use without assistance, has not been shown to reduce subsequent grade retention or need for special education and other services.

II. Families with Earnings Up to 300% of the Federal Poverty Line Do Not Have the Resources to Purchase High Quality Early Childhood Services for Their Children.

Families in This Group Do Not Have Equal Access, and Settle for Lower Quality That Does Not Help Their At-Risk Children

The ECLS-K data, analyzed by NIEER, shows that access to early childhood programs for families living below 300% of poverty is significantly lower than for families above 300% of poverty. In families below 235% of the poverty line, 70% were enrolled in center-based experiences in the year previous to kindergarten and among families in the 235-300% range, 72% were enrolled. There is no significantly statistical difference in access to early childhood programs between these groups. More than 82% of the children in families living above 300% accessed an early childhood program. This is statistically significant.

Children from 235-300% are likely to be attending lower quality programs than children from either less well off or middle-income families. These lower quality programs do not adequately address their children’s at-risk status. A Rand study of early childhood education in California found that children in families at 200-300% of FPL were less likely than children living below 200% of poverty, and less likely than those in families above 300%, to be in programs that had appropriate classroom quality scores (using the ECERS-R), or that had high CLASS scores reflecting teacher and program quality.

The families in the group from 200-300% of poverty do not have the resources to get these services their at-risk children need. Since their children are likely being served in the lowest quality programs, we can expect little positive impact on their outcomes, or reduction in need for expensive adjustments, such as Special Education and retention in grade, during their K-12 years.

Families up to 300% FPL Do Not Have Sufficient Income for Purchasing Quality Early Education
Families earning up to 300% of the federal poverty level are not making enough income to pay for quality early education that can help their children succeed.
The Pathways family income study measured the number of families in economic distress using a Self-Sufficiency Standard for Pennsylvania. The Standard calculates the wages 70 different family configurations must earn to pay for basic necessities such as child care, nutritious food, adequate housing and health care in each of the state's 67 counties. Based on real market costs, the Standard provides a more accurate portrait of economic distress than federal poverty guidelines, which are based only on food costs.
Based on the Self-Sufficiency Standard, in 66 of 67 counties the 300 % level of federal poverty level is actually lower than the sufficient income required to meet basic family needs for a family of one adult and one preschooler. In the only county where Standard is higher than 300% FPL (Montgomery) the income is only $178 above that level, not even enough to pay for a month of preschool.
Calculated for other typical family or household arrangements, similar outcomes apply. For a family including an adult, an infant, and a toddler, the Standard for 66 of 67 counties fall within the 300% FPL level, except in Montgomery County, where the difference is only $2,035 above 300%.
For families including two adults, an infant, and a preschooler, all 67 counties fall within the 300%.
Reducing the need for individual families to pay for high quality early childhood education can make a big difference in their ability to be self-sufficient and also enhances the children’s outcomes. "The Self Sufficiency standard indicates that housing and child care are two of the largest budget items, and, therefore, are often the primary sources of much of the economic stress faced by families with inadequate incomes."
The Self Sufficiency Standard shows that families earning up to 300% of the federal poverty level do not have adequate income to purchase their early childhood education services on their own, and therefore may make risky choices for their children: "One may assume that the great majority of households who lack sufficient income, but receive no public aid, are … resorting to private subsidy strategies such as . . . using informal/inexpensive child care.” This will fail to deliver the long-term benefits to children and to taxpayers, of high quality programs such as Keystone STARS 3 & 4, Pennsylvania Pre-K Counts, and Head Start.
The more children under school age in a family, the greater the income insufficiency of the family, especially in single-earner households. "The proportion of households with inadequate income is 15 percent for households with no children, but increases to 21 percent for households with one child. Of two child households, 26 percent have inadequate income and 43 percent for households with 3 children."
Taxes and daily living expenses have a strong impact on net income
The enclosed budget provides a depiction of typical monthly expenses for a family with two young children taxed in a typical central Pennsylvania county (York) whose gross earnings are 300% FPL. Expenses were calculated very conservatively (see car payments, food expenses and very low preschool and child care if both parents are working). Excluding entertainment and miscellaneous expenses, as well as any long term investments or future savings for college, this family is unable to meet all their financial obligations and pay for preschool tuition.