NM might consider social impact bonds for expanding early childhood services

Dr. Arthur Rolnick—the keynote speaker at our 2014 NM KIDS COUNT Conference—made a compelling case for higher levels of investment in early childhood care and learning services. Many people in New Mexico agree that these kind of investments will help us improve the well-being of our children. Unfortunately, there has not been a consensus in Santa Fe on how to pay for these programs.

Other states and countries are using a new financing tool—social impact bonds—to pay for preventive high quality early childhood programs like home visitation, childcare and early learning, and pre-K, which have a clear pay-off. The term “social impact bonds” is really a misnomer in that the government does not issue bonds to pay for the programs. Social impact bond financing programs are also referred to as “results-based financing” and “pay-for-success” programs. As these names imply, they are based on the premise that pay is made only when results have been delivered.

So what is results-based financing? Under results-based financing programs, private investors or philanthropists, sometimes jointly, pay for programs that will save taxpayer dollars in the future. In essence, they pay for prevention rather than remediation. Here’s how it works: in the case of early childhood education, non-public dollars are used to pay for high-quality, multi-year programs that are expected to reduce (not necessarily eliminate) the need for expensive special education services and other remediation programs. The investors—private and philanthropic—are then repaid with government dollars, with interest, as the programs demonstrate success in obviating the need for other already-funded programs. Clearly, a critical element of this funding structure is agreement between all parties upon what constitutes success and how that success is measured.

An exciting potential of such financing tools is that they increase the pool of funding for critically needed preventive programs using non-governmental sources. In the U.S., use of this new financing tool has been relatively small in scope and not mature enough to demonstrate whether or not it will be successful. A downside of this financing tool is that the money provided by the private or nonprofit funders must be re-paid with an agreed-upon profit—to cover principal risk and fees—built into the payments, which means that the programs may end up costing more than if they were funded directly by the government. If properly structured, investors are only repaid if the savings are realized, which requires a high level of diligence on the part of government officials.

If such programs prove to be highly successful they may be worth the extra cost. Dr. Rolnick indicated that the return on high-quality early childhood care and learning services has been shown to be 16 percent or higher. It may be worth diverting some of this return to expand these programs with social impact bonds if there seems to be no other way to pay for them. We also need to ensure that we will not end up taking money from other already under-funded programs to re-pay the private investors.

To learn more about social impact bonds go to the Harvard Kennedy School’s Social Impact Bond Technical Assistance Lab at www.hks-siblab.org.

James Jimenez is Director of Research, Policy and Advocacy Integration at NM Voices for Children. Reach him at jjimenez@nmvoices.org.

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Most SNAP recipients would work for food – if they could find a job

The proposal by Governor Martinez’s Human Services Department (HSD) to reinstate work requirements on recipients of food benefits is ill-considered and reflects an upside-down set of values, particularly in the face of an ongoing weak economy that is not producing jobs.

The HSD plan to limit SNAP benefits unless the unemployed comply with job search and work requirements could cause families with children to lose benefits for up to a year. Childless adults who fail to complete 20 hours of work a week could lose SNAP for up to three years.

New Mexico has had and continues to be eligible for a federal waiver of SNAP time limits for jobless adults due to our high unemployment. That HSD wants to reject that waiver and federally funded food assistance for tens of thousands of jobless New Mexicans is absurd. What is the rationale for such proposal? It won’t save the state any money, as SNAP is a federally funded program. The whole point of SNAP is to help people feed their families in times of high unemployment. Denying food assistance to people when they are unemployed because they can’t find a job is like telling the passengers on the Titanic it’s their own fault there are not enough lifeboats. In what world do these public servants live?

In the real world, one in five New Mexico adults and one in three kids is already unsure where their next meal is coming from. That’s the worst rate of food insecurity in the nation. While some people in the administration don’t like to admit it, hunger is a serious problem in New Mexico with major consequences. Hungry kids have worse health outcomes, perform worse in school, and are less prepared to enter the workforce. Cutting SNAP benefits for struggling New Mexicans will mean families can’t put enough food on the table, and New Mexico kids should not be made to go hungry because their parents aren’t able to find jobs.

This proposal comes on the heels of a 2013 corporate income tax cut that will cost state services more than $70 million by 2017. What sort of accountability did we insist upon for this windfall? Absolutely nothing! Has this tax break changed the economic landscape for New Mexico? The employment data certainly has yet to indicate that is has. In fact, the latest jobs numbers show that work is getting harder and harder to find in New Mexico. Unemployment is up across the state, we’ve seen no real job growth, and still haven’t fully recovered from the recession. There could not a worse time to punish those who already cannot find a job by putting a work requirement on SNAP.

So just to review: we’re the worst-performing state in the region for jobs, the worst hunger, and are at the bottom of the list on poverty and child well-being, yet we are willing to give away $70 million in state dollars to big business with no accountability while also cutting off federally funded basic food assistance from people struggling to find work. What does this say about our values as reflected by our public policies? It says to us that our values are up-side down!

This blog was co-authored by Amber Wallin, a Research and Policy Analyst with NM Voices for Children. Reach her at awallin@nmvoices.org.

James Jimenez, Director of Research, Policy and Advocacy Integration can be reached at jjimenez@nmvoices.org.

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This is OBSCENE!

A recent report from the State Investment Council shows that New Mexico’s Land Grant Permanent Fund (LGPF) is growing at a robust pace and now exceeds $13.8 billion. It’s the second largest fund of its kind in the nation and we spend a small portion of it every year on education and other important services.

Meanwhile, New Mexico remains the worst state in which to raise a child. Only a small fraction of our youngest children have access to the high-quality early childhood care and learning services that are shown to improve their outcomes all the way into adulthood.

That we have the resources—through our multi-billion-dollar permanent fund—to turn things around for our kids and the state but we won’t use them is obscene.

Even with record-breaking returns from the stock market and projections of long-term windfalls from oil and natural gas production, all the evidence suggests that our own children would be a better investment for the state. The payoff would be a stronger state economy and better quality of life for all. High-quality child development services have been proven to yield between a 10 and 16 percent return. This return accrues not just to the child, in the form of better outcomes, but to everyone. These services save money on special education and other remediation programs, cut down on costs associated with juvenile justice, teen pregnancy, drug and alcohol abuse, and much more. They ensure that more kids go to—and finish—college. They prepare children for future success, and since today’s kids are tomorrow’s workforce, we would all benefit from their success. New Mexico would finally have what it takes to draw high-wage jobs to our state—an exceptional workforce and people with plenty of money to buy goods and services.

New Mexico has some very effective home visiting, child care, and pre-K programs, but they reach just a fraction of the children who could most benefit. The Legislature has increased funding over the last few years, but at this pace a full roll-out will take decades. By then it will be too late for most of today’s kids. Still, our lawmakers have refused to allow the people to vote on whether to invest just 1 percent of our nearly $14 billion permanent fund on improving child well-being. If the initial 2011 proposal to invest 1.5 percent of the LGPF had passed and the voters had approved it in 2012, the LGPF balance would have grown to about $13.4 billion instead of $13.8 billion. But we would have invested in tens of thousands of our most vulnerable young kids. We’d be putting them—and the whole state—on a course for success. We invested it in Wall Street instead.

Anyone who cares about improving outcomes for our children must find that offensive to their sense of morality or decency.

Bill Jordan is Senior Policy Advisor/Governmental Relations for NM Voices for Children. Reach him at bjordan@nmvoices.org.

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How New Mexico has failed its unemployed workers and its economy

Unemployment insurance (UI) has both a moral and an economic dimension—and New Mexico’s UI system has failed on both fronts. From a moral point of view, the intent of unemployment insurance is to keep people who are unemployed through no fault of their own from falling into financial ruin when they lose a job. The economic rationale for the program is that UI, along with SNAP (food stamps), is one of the so-called “automatic stabilizers” that keep the demand side of the economy from collapsing when the nation falls into a recession.

The moral rationale for the UI program is strong: people who lose their jobs or who are laid off in the course of a recession are victims of the workings of the business cycle. In New Mexico the unemployment rate peaked at 8 percent in 2010, and has yet to return to pre-recession levels. During the early course of the recession the UI program was performing its dual functions well. The moral aspect: unemployed people who were looking for work and who were out of a job through no fault of their own were being helped by the UI program. From an economic perspective, the UI program was helping to restore the health of the economy by shoring up demand for the goods and services provided by the state’s businesses and preventing the state’s economy from falling into a downward spiral fueled by falling wages and falling consumption.

In 2009, for example, on average 72 percent of the unemployed received payments under the state and federal UI programs. Of that 72 percent (called the ‘recipiency ratio’) 46 percent were covered by the New Mexico UI program and 36 percent were covered by emergency federal programs. The picture began to deteriorate in 2010, though, as just 66 percent of the unemployed were receiving UI payments, with 34 percent of the unemployed covered by the state program and 32 percent covered by the federal add-ons. The situation continued to worsen slightly in 2011, with an overall recipiency ratio of 63 percent, with 32 percent covered by the state and 31 percent by the federal program.

In 2012 the recipiency rate had fallen to 55 percent with a 32/23 percent state/federal split. At the national level, the hostility of the conservative majority in the U.S. House of Representatives toward the unemployed was beginning to prevail. Nationally and in the state, this shifting political balance was leading to the declining availability of UI, even though the labor market had clearly not recovered. In 2013 only 36 percent of the unemployed were receiving UI, with 26 receiving UI under the state and only 10 percent under the federal program. With the expiration of all emergency federal programs, only 25 percent of the unemployed were receiving UI by the first quarter of 2014—despite the fact that the New Mexico economy was still shedding jobs.

The severity of the recession had nearly drained the New Mexico UI Trust Fund, the fund from which UI benefits are paid. It fell from almost $600 million before the recession to below $50 million in 2014. The Legislature should have replenished the fund by substantially raising employer taxes, but that is not the approach that the state took. Prior to 2011, UI recipients with dependents could receive an extra allowance of $25 per week, per dependent for up to four dependents. In 2011, the Legislature cut the number of dependent allowances from four to two, dealing a blow to many families. UI benefits for students were also restricted. The Legislature did approve an employer tax increase, but it was vetoed by the Governor. In 2012 a small UI tax increase was approved and signed by the Governor.

By April 2014, the unemployment rate in New Mexico was 6.9 percent. That’s the 15th highest among the states, and is still above the national rate of 6.3 percent. New Mexico has had the lowest rate of job growth of any state, at negative 0.5 percent, having lost 4,400 jobs from April 2013 to April 2014. New Mexico’s low UI recipiency rate shows that New Mexico has been failing its unemployed workers. The failure is both moral and economic. It is unconscionable for the state to leave its unemployed workers to spend all of their savings and then end up destitute. The failure is also economic, as UI cannot fulfill its function of ‘automatic stabilizer’ to maintain demand for the goods and services of the state’s businesses.

Gerry Bradley is Senior Researcher and Policy Analyst for NM Voices for Children. Reach him at gbradley@nmvoices.org.

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We’re 49th! A stroke of luck or the result of positive change?

The 2014 national KIDS COUNT ranking of states in child well-being just came out. There was a lot of uproar last year when, for the first time ever, New Mexico was ranked dead last—a position that had always been reserved for Mississippi. This year, Mississippi is back in 50th and we are ranked 49th. That’s good news, surely, but we have to ask ourselves … is it just a statistical fluke? Or, could our state possibly be starting to make progress in improving children’s lives? And, if this is so, can we sustain this movement?

On the plus side, with regard to policy, this year the Legislature appropriated approximately $175 million in new funding to support such programs as early childhood development services—the evidence-based NM Pre-K and home visiting programs, child care assistance, and the Family, Infant, Toddler (FIT) program—along with school-based health centers, K-12 education, programs aimed at mentoring youth and preventing dropout, and for additional child protective and foster care services. All of these programs give children a good start in life and ways to remain healthy, safe, in school, and moving forward. Since 2013, New Mexico has seen our child poverty rate drop somewhat, as well as the percentage of children whose parents lack secure employment, the teen birth rate, and the percentage of children living in families where the head of the household lacks a high school diploma.

On the other hand, like the proverbial Jack and Jill, New Mexico has tumbled down the hill of child well-being in certain areas. Since last year, more of our teens, ages 16-19, are not in school and not working. This is a major concern, as this age group is moving into adulthood, trying to find employment, starting families, or going on to college—and more of them don’t seem to be off to a good start, especially among our Hispanic, American Indian and Black youth, who make up the majority of our youth. More of our children than ever live in single-parent families, which tend to have lower household incomes and assets to provide for even their basic needs.

The effort and willpower it will take to improve our children’s health, economic status, education levels, and community environments will require a long-term, concerted, bipartisan commitment. Though we’ve perhaps taken a tiny step upward since 2013, some longer-term trends in our data indicate crucial areas we need to address soon if we’re to maintain positive momentum. For one, although fourth grade reading proficiency has improved in almost every state since 1992, it has not improved in New Mexico. In 1992, only 23 percent of our fourth graders could read proficiently; in 2013, unhappily, even fewer—21 percent—read proficiently. Given that this indicator of reading capacity is linked so strongly to children’s progress in school, graduation rates, college enrollment, and even career potential, New Mexico must address this problem as soon as possible. One factor related to this, which can be improved through policy change, is the fact that, over time, since 2005 to 2012, the percentage of three- and four-year-olds enrolled in preschool, a cornerstone to helping prepare children for school, has remained very low (37 to 38 percent). We need to provide more of our preschoolers with access to high quality early childhood development and learning.

So, let’s return to the question at the start of this blog. All of us—policymakers, advocates, parents, employers, service providers, and others—must continue to play our parts, in collaboration and in sync with others—to bring about lasting improvement in child well-being in New Mexico. Let’s not continue to just play “ranking leapfrog” with Mississippi. Rather, let’s bring about significant, lasting change. Let’s persist in urging our policymakers to invest more state monies in our children, where we will all get the most “bang for our buck” in terms of shared prosperity in the future. Let’s evaluate our efforts to ensure we fund what works and discontinue policies that don’t. Let’s set our sights higher and continue to move upward.

The Annie E. Casey Foundation’s 2014 national KIDS COUNT Data Book is available at: http://www.aecf.org/resources/the-2014-kids-count-data-book/

The fact sheet for New Mexico is available at: http://www.nmvoices.org/wp-content/uploads/2014/07/US-NM-Kids-Count-profiles-2014.pdf

Our updated NM KIDS are COUNTing on Us policy agenda is available here: http://www.nmvoices.org/wp-content/uploads/2014/06/KIDS-COUNTing-policy-agenda-June-2014-update-web.pdf

Chris Hollis is the KIDS COUNT Program Director for NM Voices for Children. Reach her at chollis@nmvoices.org.

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Let’s have a debate about the real deficit

Bloggers and politicos are trading barbs over the truthfulness of the Governor’s repeated claim that she closed the largest budget deficit in the history of the state. (Of course, by constitutional mandate the state cannot run a deficit, so there never was a deficit to close.) We can spend the summer debating the definition of a deficit or we can (and I believe we should) have the more important debate about how we want that budget to look in the future.

There is no doubt that the recession was hard on New Mexico’s budget. When the economy soured in 2008, tax revenue fell dramatically and drove New Mexico into a financial crisis. Our state leaders had three options to address the budget crisis: raise revenue, cut spending or some combination of the two. Initially they reacted by taking a somewhat balanced approach—raising some revenue and cutting some spending. As the crisis continued, the approach by state leaders evolved to one that focused exclusively on cutting spending.

Over the course of the recession our elected leaders balanced the budget by:

  • Making the fifth deepest cuts in the nation to per-pupil K-12 spending;
  • Making the deepest cuts in the nation to per-pupil higher education spending, leading to steep tuition increases and a lottery scholarship program that’s now going broke;
  • Cutting special education funding, resulting in an even greater loss of federal dollars for special ed.;
  • Cutting eligibility for child care assistance so deeply that thousands of families remain on a waiting list that is now six years old;
  • Cutting funding for outreach and enrollment for children in Medicaid, leaving fewer children enrolled in the health coverage program than three-and-a-half years ago;
  • Cutting youth tobacco prevention programs, school-based health centers, youth suicide prevention, mentoring programs, and numerous other child and family support programs; and
  • Failing to adequately staff the Child Protective Services arm of the Children, Youth and Families Department, which investigates child abuse and neglect, resulting in a “savings” of $6 million to the state budget.

This is not a complete list, but it’s enough to make evident that while New Mexico’s elected leaders balanced the budget, they did it on the backs of our children. It should come as no surprise then that it was during these last few years that our children dropped to 50th in the nation in child well-being.

What is also tragic is that lawmakers somehow made room in the budget recently for hundreds of millions of dollars in tax breaks to corporations and businesses. Those tax breaks have yet to attract new jobs.

We’re entering campaign season and the rhetoric will fly about what kind of future we want for our state. My hope is that instead of recalling the deficits of the past, we’ll see a vigorous debate about our future and about the real deficit that threatens it—our disinvestment in our children. We need to drill our candidates for governor, the state House of Representatives, the Congress, and other offices about the issues that really concern us all. We need to ask questions like:

  • Will you invest in high-quality early childhood programs like home visiting, child care and pre-K, so all of our children have access to these programs within a few short years?
  • Will you restore outreach and enrollment programs for children’s Medicaid so all of our eligible children are enrolled in health care coverage?
  • Will you end the waiting list for child care assistance in your first year in office?
  • Are you willing to raise new revenue if the plight of our children and families is at stake?
  • Will you implement an economic development plan that doesn’t rely on tax breaks for profitable corporations but, instead, invests in our workforce?

Let the debate begin!

Contact your County Clerk’s office to find out who is running to represent you in state and local races.

Bill Jordan is Senior Policy Advisor/Governmental Relations for NM Voices for Children. Reach him at bjordan@nmvoices.org.

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Running from the taxman? To what?

Changing tax rates nearly always has consequences, some of which are intended, some of which are not. If we are to believe anti-tax advocates, taxes inhibit economic development, distort our economy, and cause people to “vote with their feet” by moving to a place with lower rates. Usually these claims are mere assertions without data to support them. And in fact, most unbiased analyses show that taxes have a negligible impact on economic development and that other factors—such as an educated workforce, access to markets, and quality-of-life considerations—are more important in business location decisions. The impact that taxes have on the interstate mobility of individuals and families has been less clear. Could taxes be the reason that New Mexico has seen population growth stagnate in recent years after decades of growth? The answer is a resounding no, according to a new research report.

According to the “anti-taxists,” taxes need to be slashed to reverse population declines, and this seems to be the approach that Kansas has taken. However, a new report from the Center on Budget and Policy Priorities (CBPP), titled State Taxes Have a Negligible Impact on Americans’ Interstate Moves, debunks the claim by anti-tax advocates that high taxes cause people to flee a state. The report concludes that “Differences in tax levels among the states had little to no effect on whether and where people move.” Interestingly, fully 69 percent of Americans still reside in the state in which they were born and only about 2 percent make interstate moves. So what causes us to decide to move to another state?

line graph showing decline in interstate relocation

Just as with economic development, other factors seem to be more important. Not surprisingly, it’s jobs—either new, transferred or lost—and family issues that a vast majority cite as the reasons for moving across state lines, according to the report’s author Michael Mazerov. Notably, evidence also shows that people are almost as likely to move to high-tax states as low-tax states. This is clearly not consistent with the policy recommendations espoused by the anti-tax advocates. So what gives?

Those who constantly cry for tax cuts seem not to comprehend that communities with well-paying jobs with great schools, decent streets, strong public safety, cultural amenities, and parks are what draws residents and business. Working to establish an appropriate balance between taxes and these other factors that make a community a great place to live is much more productive work for public officials than fixating on tax cuts.

The state of Kansas is a great illustration of the folly of basing economic development strategy and resident retention on tax cuts. Since Kansas slashed their personal income taxes, their courts have ruled that the state is not adequately funding their public schools, and now bond rating agencies have warned investors to be careful about investing in bonds issued by the state.

Just like Kansas, we are now facing lawsuits on the funding for our public schools. And just like Kansas we have been making poor decisions about taxes, such as the misguided and unnecessary corporate income tax cuts of 2013 and the annual erosion of our gross receipts tax revenue through the granting of special tax breaks. And, just like Kansas, our population growth has stopped.

So what are we to conclude from this comparison with Kansas? Oliver Wendell Holmes, Jr. got it right when he said, “Taxes are the price we pay for civilized society.” I also believe—and evidence backs me up—that we can’t tax-cut our way to prosperity. What we really we need is sustained investment in people, transportation, and water management to change the direction of our state not more tax cuts.

James Jimenez is Director of Research, Policy and Advocacy Integration at NM Voices for Children. Reach him at jjimenez@nmvoices.org.

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Yet another missed opportunity for our kids

Since New Mexico dropped to 50th in the nation in child well-being almost a year ago, little if anything has been done to turn things around for our kids. Now comes news of yet another lost opportunity for improving outcomes for our young people.

The U.S. Department of Health and Human Services has just released a new report on state ObamaCare enrollment through the health insurance exchanges or marketplaces. The report shows a dramatic failure on the part of New Mexico to sign up young people. Of all the states, New Mexico was tied for 5th worst in the percentage (14 percent) of sign-ups who were under age 26, and tied for 4th worst for the percentage (29 percent) of sign-ups who were under age 35. Just 7 percent of those who signed up on the New Mexico exchange were under the age of 18.

This wouldn’t be so bad if New Mexico hadn’t started out with one of the highest rates of uninsured children in the nation. States with high rates of uninsurance had the most to gain from ObamaCare. In fact, 79 percent of the New Mexicans who did sign up for coverage on the exchange received tax credits to help cover the cost of their premiums. That’s a lot of federal money that will flow into New Mexico to help keep people healthy. A lot more money would be flowing in had we worked to maximize enrollment. The fact that we didn’t use this opportunity to close the health insurance gap for our kids is just one more example of a lack of commitment by state government to ensuring that children have health care coverage.

Another example: a few years ago—well before the ObamaCare insurance exchanges opened—New Mexico cut nearly all of its funding for outreach to enroll more children in Medicaid. As a result, Medicaid enrollment of children has been flat, despite the fact that an estimated 40,000 New Mexico children are eligible but not enrolled. Efforts by advocates to restore the outreach funding failed and the uninsured rate among children remained one of the worst in the nation.

In the last year, the federal government gave the state millions of dollars to conduct outreach to enroll the most vulnerable New Mexicans in ObamaCare. These are the people who are most likely to have never dealt with an insurance company before, and least likely to have access to a computer and have the necessary computer and/or literacy skills to navigate the enrollment process. Advocates and service providers recommended that the state use the outreach money to hire people who would go into communities and actually assist these folks with the enrollment process. Instead, an out-of-state P.R. company was hired to create an ad campaign. Clearly the ads weren’t as effective as they could have been.

For a state that is 50th in child well-being, one would think that our leaders would have grabbed this extraordinary opportunity to use those millions of dollars of federal outreach money in the most effective way possible in order to improve health outcomes for kids. Sadly, as this new report shows, it was just another missed opportunity.

Bill Jordan is Senior Policy Advisor/Governmental Relations for NM Voices for Children. Reach him at bjordan@nmvoices.org.

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No Pell Grants for Preschoolers

From time to time, legislators (and the governor) get obsessed with an issue—so much so, that they all work together to move forward with a solution to the same problem. Lately their obsession has been the loss of revenue to the state’s lottery scholarship that’s endangering the whole program. There were at least 10 bills in the 2013 legislative session and another 17 bills introduced in this year’s session that dealt with the lottery scholarship.

Don’t get me wrong, I’m a BIG fan of the lottery scholarship and other forms of financial help for college kids and their parents. The lottery scholarship is a great program. And it was (and still is) in trouble and in need of a fix. I’m glad they obsessed over it, studied it, seriously debated it, and came up with a solution—at least for the next couple of years.

But I wish that legislators would show the same level of obsession—the same serious study and debate—over how to pay for the high cost of high-quality child care.


Because high-quality child care costs more than college.

You read that right. A nationwide study has confirmed what I said in a blog almost a year ago—that quality child care in New Mexico costs more than college tuition.

graphic showing high cost of child care

There are many other reasons legislators should obsess over the high cost of child care: because of our high poverty rates, more of our kids need it and fewer working parents can afford it; because preschoolers don’t get Pell Grants, can’t take out a student loan, and don’t qualify for work-study so their parents are stuck with the cost upfront; and because, arguably, high-quality child care is more important to a person’s development than college. It literally builds the foundation for learning that will make college attendance possible later—but only if it’s a high-quality program. And that costs more.

In New Mexico, a high school graduate who meets the minimal academic requirements can get a lottery scholarship no matter what their parents make. To get child care assistance, our youngest kids have to live near the poverty level.* Even then, these most vulnerable children are not likely to receive the high quality of care they need to give them the best shot at success in school and life. We simply do not invest enough resources to ensure that all children receive safe child care, let alone high-quality care.

In others words, because we want as many of our kids to go to college as possible, we do our best to make it affordable. But we don’t do our best to ensure that as many kids as possible will have the academic chops to attend college by making high-quality child care affordable.

Hopefully, the fact that high-quality child care is out-of-reach for too many children, along with the growing awareness of the importance of the early years in a child’s development, will spur lawmakers into greater action. Is it too much to hope that they would one day soon obsess over how to fix funding for high-quality early childhood programs the way they obsessed over fixing funding for the lottery scholarship?

*In New Mexico, assistance for child care costs are currently available only to those families making less than 150% of the Federal Poverty Level. That’s $19,790 or less for a family of three. Until a few years ago, New Mexico provided assistance to families under 200% FPL, but the budget for the program was cut and funding (and eligibility) has yet to be restored.

Bill Jordan is Senior Policy Advisor/Governmental Relations for NM Voices for Children. Reach him at bjordan@nmvoices.org.

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New Mexico is funding higher education way below pre-recession levels: Why we must reverse the trend

A report released by the Center on Budget and Policy Priorities recently showed that New Mexico has cut per-student higher education funding by $4,588 since 2008. That’s a deeper cut than all but two other states. These funding cuts caused tuition to climb by an average of 25 percent since the recession and could mean serious consequences for New Mexico students.

How did this happen? Well, as our state slid into the recession, rather than choosing a balanced response to falling revenues that included both funding decreases and strategic revenue increases, New Mexico, like most states, relied almost solely on spending cuts to balance the budget. As a result, higher education funding was slashed, and universities responded by raising tuition and fees for students. The budget was balanced, but partly on the back of New Mexico college students.

Since 1973, public college tuition has grown by nearly 300 percent, but median household income has grown by only 5 percent. So, tuition has been skyrocketing at the same time that wages have been stagnant for all but the wealthiest earners, as this graphic shows.

grapph showing tuition has out-paced incomes

Students in New Mexico and across the country are now facing bigger hurdles than ever when it comes to financing their college educations. As states cut higher education funding, universities raise tuition and fees. As costs go up, students—especially those that are low-income—are forced to finance their education through loans. Growing student loan debt is made more difficult to repay due to rising interest rates. Like a snowball rolling down a hill, these barriers build on one another and are threatening to run over college students.

In New Mexico, those most in danger of being run over are low-income students who can’t keep up with rising costs, working students (who are unable to meet the now full-time requirements for the lottery scholarship), and a disproportionate number of minority students.

Our state’s kids are ranked last in the nation in child well-being, our economy is flat, and nearly 20 percent of our families live in poverty. On top of that, according to the Working Poor Families Project, while more than half of New Mexico’s working poor families have parents with no postsecondary education, it is tough for these parents to take college courses and move into better-paying jobs because only 25 percent of our state financial aid is need-based. Our policies, budget cuts, and tuition increases are not only holding back those who need an affordable college education the most, but also hampering New Mexico’s ability to develop a highly skilled workforce that can attract the businesses we desperately need to build our flailing economy.

But the news isn’t all bad. In fiscal year 2015, for the third year in a row, the state increased higher education funding, though by only a very small amount (about 5 percent). Lawmakers also provided a temporary patch to the lottery scholarship fund, but we are still far below pre-recession, per-student spending, and low-income, working, and minority students will continue to be hard-hit from decreased spending and increasing tuition unless serious improvements are made.

These improvements can begin with the lottery scholarship. The lottery scholarship should be need-based so that its limited funds go to those who need help the most and who face the biggest financial barriers to getting a college education. We should also consider restoring the College Affordability Fund, which had a $100 million balance prior to being raided for funds during the recession. Just as importantly, we must prevent future cuts to education budgets. New Mexico needs to reject further calls for more corporate tax breaks and consider new revenue options. We need to invest in our kids and our future by making education high-quality, accessible, and affordable.

Amber Wallin is a Research and Policy Analyst with NM Voices for Children. Reach her at awallin@nmvoices.org.

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