How are things going at Little Star Twisp?
We are now in our second year of providing care to infants and toddlers at our Twisp campus and we are delighted to report that it is going extremely well! The children are engaged and happy, our teachers are feeling confident and connected to each other and the children, and families are being supported. It feels exactly how we hoped it would feel -- like a home away from home.
What are some of the tough decisions you are facing as an organization?
The hardest decisions we face are always related to maintaining the highest quality in our programming while staying within budget. One thing we learned in year two of operating at the Twisp campus is that the space is a little too small for 11 toddlers per day. We determined that 9 students was the optimal number to meet the needs of the children. Lowering our enrollment by 2 students per day is a hit to our budget but we made the decision that is most optimal for the program.
Likewise, balancing flexibility for families with keeping classrooms full is always a tough one. For example, our enrollment on Mondays and Fridays is low this year. We feel it’s important to offer 2, 3, and 4 day per week programming for families that need it, but also remain open Monday-Friday for those that need coverage for the full week. We lose revenue efficiency on low enrollment days, but we feel meeting the needs of families is our highest priority.
The costs to run a licensed early childhood education facility are significant given the small teacher-student ratio and requirements for space and materials. How are you currently making ends meet?
It is expensive to run an early childhood facility! Our largest cost is by far our payroll expenses (78% in 2018-2019). However, our teachers make Little Star the amazing place that it is, so we strive to pay a competitive living wage and create a positive working culture for all of our staff.
In addition, we strive to keep our tuition as affordable as possible for families. We would love to not charge any tuition, but public funding for early childhood education is extremely limited at both the state and federal level. So, we set tuition rates below true costs and we make up the difference with fundraising efforts from our board and staff (biennial auction) and with parent-led fundraisers like our Yard Sale this coming spring.
Our financial aid program is the third puzzle piece in our financial equation. In 2019-2020, we have budgeted to issue over $100,000 in financial aid to families in our valley. We are proud that over 30% of our students receive financial aid, with 11% receiving subsidies from the state of Washington via DSHS/DCYF. Many people do not realize that Little Star still heavily subsidizes families receiving DSHS support via our financial aid program, as the facility reimbursement from the State only covers 40%-50% of our true cost. In 2018-2019, we pulled $28,000 from our financial aid fund to cover the additional cost of families receiving state support to attend Little Star, and we anticipate pulling over $40,000 to cover these costs in 2019-2020.
To make a long story short, our annual operating budget balances, but we are currently pulling money from our long-term reserves to cover our financial aid program. Stabilizing our financial aid reserves is our biggest fiscal challenge and this is where we are focusing a lot of effort!
Where do you see the best opportunities for growth and sustainability?
One of Little Star’s long-term goals is to address the root issues surrounding affordability and accessibility for early learning and childcare. We have made some important strides but our work is not done. Now that we’ve doubled in size and doubled our financial aid program for families, we are at the stage of long-term financial planning and are pursuing an endowment to fund our financial aid program and advocacy work to expand funding for early learning at the state level. Our goal is to build a sustainable model that will support our mission and the families we serve well into the future.