Can a state like California get to universal child care? These experts say yes

It’s no secret that childcare is expensive — and unaffordable — for many families. In L.A. County, costs for childcare take up, on average, nearly 20% of a family’s household income.

But in papers published last week, researchers at the University of California and Stanford say a solution is possible — and that a universal childcare system can be implemented in California, the most populous state in the country.

“It is not easy to fix the childcare market. It requires investments of resources … but it is feasible,” said Neale Mahoney, a professor of economics and director of the Stanford Institute for Economic Policy Research. “I'm optimistic that if we focus on this issue, then we can take big strides.”

Last year, New Mexico became the first state to offer universal childcare, and local jurisdictions like San Francisco and Alameda County have moved to infuse money into their childcare systems.

Economists at Stanford estimate it would cost the state between $12 to $21 billion a year to implement a universal childcare system for children 3 and under. The researchers say the investment could lead to 100,000 mothers joining the workforce, which could create up to $23 billion in GDP for the state.

“What happens fairly immediately from a program that provides more robust childcare coverage is that you have more parents working in particular, you have more moms able to work, and of course, that contributes right back to the economy in the form of taxes,” said Chloe Gibbs, a policy fellow at the Stanford Institute for Economic Policy Research.

Researchers at UC Irvine and UC Berkeley, in a parallel paper, said the current childcare infrastructure needs to be changed to make a universal system possible and made a series of recommendations. That includes combining a confusing system of 14 different funding streams for subsidized child care.

“ It shouldn't be on providers and families to sort through what they're eligible for and the regulations of all of them,” said Jade Jenkins, associator professor of education policy at UC Irvine.

Where will the money come from? 

In New Mexico, the state’s universal childcare program is paid through the state’s sovereign wealth funds supported from oil and gas revenues. While California doesn’t have that sort of dedicated funding stream, Gibbs says there are other options.

Gibbs said some states have used lottery funds for childcare, or implemented so-called “sin taxes” — taxes on products like cigarettes or alcohol, while others have also created endowment funds. “Then of course, there’s the redeployment of dollars that are currently spent on other things,” she said.

Currently, the state has set aside $7.5 billion for subsidized childcare in the proposed budget, including more than $5 billion from the state’s general fund. That amounts to about 2% of the state’s budget.

Learn more about the child care system

• California's childcare sector is already fragile. Can it survive the next natural disaster? Preschools have been closing in L.A. County. There also are not enough childcare providers, and those who are in business are chronically underpaid.
• San Francisco gave child care workers a massive raise. Is it a model for LA? Three years after the city's pay plan launched, those involved say it's been transformative. Some educators said the additional pay is keeping them in their jobs, and making a future in the profession viable.
• New Mexico will be the first state to offer universal child care. What could that mean for California? New Mexico has been offering free childcare for families who make up to 400% of the federal poverty level, and starting in November, it removed the income eligibility requirements — making the program universal for families.