Item 6- Cost model of child care in Austin-Travis County — original pdf

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Greater Austin Cost Model Analyzing the True Cost of Child Care January 10, 2023 What is a cost model? ● Tool to measure the true cost of a service ● Used to understand gaps and predict funding needs ● Accounts for regulations and programmatic components that influence cost impact overall cost ● Ability to predict how changes in wages, structure, quality, and location Sources ● Survey of local child care providers on program structure and finances (56 respondents) ● Texas Workforce Commission: Subsidy rates and staffing ratios ● TWC/University of Texas: Cost of Quality Price Modeling Reports ● AISD: “Pay parity” salary scales ● Prenatal-to-3 Policy Impact Center at Vanderbilt University: Benchmarking Design VIEW DEMO Interactive workbooks that capture how changes in enrollment, Texas Rising Star Ratings, and staffing affect per-child costs in comparison to reimbursement rates Range of Costs Factors that influence cost include: ● Wages and benefits ● Staffing ratios ● Number of participants ● Facilities Subsidies are determined by Texas Rising Star (TRS) quality rating Model estimate for a center with current average TRS4 structure Model estimate for a TRS4 center with comprehensive benefits, $20/hr minimum wage, and lower staffing ratios Annual per infant subsidy for a TRS4 center is ~$17,000 depending on days of care Average annual per infant tuition at a center is $14,500 Key Trends & Takeaways ● Personnel (staffing ratios,wages, and benefits) account for the majority of overall costs at both center and home settings. ● Infants and toddlers are the highest-cost age groups for providers to serve ● True cost of care generally exceeds reimbursement rates, particularly at higher quality facilities ● Providers that seek to improve quality and/or increase employee benefits incur further costs that must be made up through external funding or higher tuition Questions?