Finance plan projects big gaps for early childhood initiatives in coming years
Jan. 27—Even as the birth rate in New Mexico trends downward, the state agency serving children 5 and under has plans to reach more kids and families — but is predicting extensive funding gaps in getting there.
While federal relief funds are projected to provide $14.7 million more in fiscal year 2023, the state Early Childhood Education and Care Department — which relies on a mix of federal, state and grant funds — projects a more than $296 million revenue gap for fiscal year 2024 that widens to more than $504 million by fiscal year 2026.
The agency's leader said officials are moving now to deal with the potential problem.
"We believe if we can actually address and fund this, that we'll see that families across New Mexico are going to have more choices," Early Childhood Department Secretary Elizabeth Groginsky said during a news conference Thursday. "We're going to see both short- and long-term improvements in our educational and health outcomes."
In November, the department requested $201.7 million from state lawmakers from the general fund and Early Childhood Trust Fund for the 2023 fiscal year — including more than $49 million from the general fund for child care assistance, $43 million for public preschool and $32 million for private preschool.
Also that month, the newly established agency released a four-year financial plan demonstrating a deeper picture of need for a state attempting to serve its youngest citizens through services such as child care, preschool and home visits.
The plan was mandated by 2019 legislation creating the department — one of the first of its kind in the nation — and highlights a need for funding that covers "actual cost of services," according to the plan.
"We have to grow investments," Groginsky said. "This system has been woefully underfunded and not just in New Mexico. New Mexico is ahead of the game. It's a nationwide problem."
The plan emphasizes a need for higher pay for child care workers and home visitors to reduce turnover and improve service quality and a need to look beyond state funds to get there.
"We have business and philanthropy ... we've attracted private funding at a level," she said. "We're working very closely with our [Native] nations in terms of how to leverage funding, and we know the federal government is a big part of the support we get."
Child care assistance, the leg of the department that serves about 19,000 children this year, is set to reach nearly 27,500 during 2023 and expand to more than 47,000 by 2026.
The projection comes from an assumption parental employment will increase as the state continues to support child care assistance in coming years.
Birth rate projections from researchers at the University of New Mexico show if recent declines continue, the number of children under 6 in the state could fall from 134,192 in 2023 to 121,335 in 2026.
Potential funding sources are significant: the Early Childhood Trust Fund could yield $172 million a year by 2026, according to the Legislative Finance Committee.
If voters approve a move this November to tap the state's Land Grant Permanent Fund for education initiatives, the department could see an extra $147 million to $150 million each year.
After announcing a coronavirus pandemic-era expansion of child care assistance eligibility to higher-income families in the state this summer, Gov. Michelle Lujan Grisham expressed hope those funds could be used to make the expansion more permanent.
