NC pre-K program expansion could cost $300M plus

The price tag, based on per-child spending for high-quality academic pre-K estimated by Gov. Beverly Perdue's administration, raised questions among Republican lawmakers on a health oversight committee about how the state could afford such an expansion any time soon.

The legislature appropriated $128 million this year to provide education to 24,750 4-year-olds this year in the program formally known as More at Four. There could be more than 42,000 additional preschoolers annually that meet economic or developmental requirements to be labeled at-risk but currently aren't served.

Perdue, a Democrat, asked lawmakers Monday to give her $30 million when they reconvene next month to teach another 6,300 preschooolers – a move she called a first step toward meeting Superior Court Judge Howard Manning's ruling. Perdue said a timeline offered by the Department of Health and Human Services to serve 67,000 4-year-olds by mid-2016 is subject to change.

Rep. Nelson Dollar, R-Wake, co-chairman of the legislature's oversight committee on health and human services, suggested it was careless of Perdue to propose the expansion without options to pay for it in the coming years. He said the state soon will shoulder additional costs when as many as 700,000 additional North Carolina residents are added to the Medicaid rolls through the 2009 federal health care overhaul.

"If the governor wants to recommend moving in that direction, then the governor needs to put forward a plan as how to we would pay for that program," Dollar said during a break in the meeting. "It just seems like the governor is wanting to obligate us to move down a path that could cost the state some $300 million with no real way to pay for it."

Perdue offered to lawmakers Monday how to find the first $30 million. She said the long-term HHS plan was aggressive in reaching the pre-K goal and would take longer to carry out if the money isn't available. It's the Legislature that ultimately decides on how to fund programs, subject to a governor's veto.

Perdue "is committed to working with the General Assembly to implement the terms of the order in a prudent and fiscally responsible way," Chris Mackey, the governor's press secretary, said Tuesday. "The state cannot flip a switch and ramp the program up overnight."

Manning ruled in July as unenforceable provisions in the state budget that he said placed obstacles in the way of low-income families who could benefit from the free preschool education now called North Carolina Pre-Kindergarten. The GOP-penned budget required most families who qualified for the program to make a co-pay to participate.

Republican lawmakers disagree with Manning's ruling, saying the legislature makes funding decisions, not the courts, or otherwise the state could be saddled with a large entitlement program. State attorneys are appealing the ruling.

"Judge Manning's rulings have been overturned in the past, and this one very likely could," said Rep. Justin Burr, R-Stanly. "I really think that we shouldn't put the cart before the horse. We need to see where this plays out in the judicial system."

Deborah Cassidy, director of the state Division of Child Development and Early Education, which operates North Carolina Pre-K, didn't immediately have a cost for carrying out a plan required by Perdue through an executive order in August. The compliance plan, however, said it would likely cost $8,500 per child for year to provide 10 months of school.

Health and Human Services Secretary Lanier Cansler confirmed later Tuesday that fulfilling the plan could cost more than $300 million — adding 9,000 pre-K slots annually for the next four fiscal years would cost $306 million based on the $8,500-a-year figure. That doesn't include the 6,300 slots for which the $30 million Perdue is seeking and would cover only half a year.

The figure seems to fit within the range of nonpartisan legislative fiscal analysts who estimated complying with Manning's ruling at between $145 million and $360 million.

Cansler said the amount could be less because there may not be 67,000 4-year-olds annually — some parents may choose not to participate, or early childhood advocates may be unable to locate needy students. Cansler said the state would be required to pay more per slot in the future because local funds that currently help cover expenses probably wouldn't be as plentiful.

Democrats on the health and human services committee warned colleagues against treating program funding like it's the state's child care subsidy program. The same family could be on the subsidy waiting list for years. Families seeking to enter the pre-K program only have one shot for each of their children to receive the tools to be successful in school, said Senate Minority Leader Martin Nesbitt, D-Buncombe.

"That child, whether we like it or not, got a year older, and (the child's) no longer pre-K," Nesbitt said. "That's what Judge Manning's trying to tell us."