Published Online: July 11, 2006
Published in Print: July 12, 2006, as Business Group Seeks Ambitious Pre-K Agenda

Business Group Seeks Ambitious Pre-K Agenda

While national business leaders may make a compelling economic argument for expanding preschool to all children, states are years from being able to afford the minimum $16 billion price tag their plan requires, experts in state budgets and early education say.

In a new study, the Washington-based Committee for Economic Development calls for high-quality preschool for all children. The initiative would cost $16 billion to $27 billion a year, according to the CED’s estimates, but is a price the group declares states and the federal government must pay.

The result, the report says, would boost the nation’s economy and deliver returns of between $2 and $4 for every dollar states and the federal government invested. The benefits of universal preschool would come in better health, less crime, improvements in educational attainment, and increased tax revenue, according to the report.

The report offers no clear answer for how to pay for such a program, which researchers say must be of high quality—and staffed by well-trained teachers—to get the desired results.

“This report is giving us the economic argument. This is just another piece that you can use to persuade policymakers this is a good idea,” said Rachel E. Dunsmoor, a research associate with the Committee for Economic Development. The report, released June 28, was funded by the Pew Charitable Trusts.

Budgets Squeezed

But state budget experts point out that the plan may be too ambitious.

The reality is that state budgets are still being squeezed by federal education mandates, growing Medicaid rolls, and rising energy prices, said Corina Eckl, the fiscal-affairs director for the Denver-based National Conference of State Legislatures.

She added that a new accounting rule requires states to account for the future costs of public employees’ health and pension benefits—a seemingly arcane change whose impact goes far beyond the balance sheet. States will have to disclose the liabilities, which will force them to either start socking money away to cover the costs, or face disapproval from bond-rating agencies, which could drive up states’ borrowing costs. ("Accounting Rule Targets Benefits in Public Sector," March 22, 2006.)

“That’s not to say the idea of preschool doesn’t have merit,” Ms. Eckl said. “The bottom line is, you have to find the money.”

It might take 10 or 15 years, but it is realistic to think states will be able to come up with the resources to enact widespread preschool programs, said Libby B. Doggett, the executive director of the Washington-based Pre-K Now, an advocate for high-quality prekindergarten. “States are finding a way to pay for this,” she said.

During the 2006 legislative sessions, she said, states infused an additional $250 million to $300 million into preschool education.

Vol. 25, Issue 42, Page 16

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