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‘Social investment’ ready to gamble on preschool

Schools, investors could see returns
By R.J. Marx

The Daily Astorian

Published on August 28, 2017 11:47AM

R.J. Marx/Cannon Beach Gazette
County Manager Cameron Moore speaks to members of the Seaside Downtown Development Association.

R.J. Marx/Cannon Beach Gazette County Manager Cameron Moore speaks to members of the Seaside Downtown Development Association.

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A new program could bring private sector funding for preschool education in Clatsop County.

County Manager Cameron Moore and Sydney Van Dusen, coordinator of Way to Wellville, came to Seaside’s Downtown Development Association meeting Aug. 10 with plans for supplementing public funds with private investment to help provide preschool for children who otherwise could not afford it.

Clatsop County is one of five communities around the country to participate in the Way to Wellville program, which came to the county in 2014.

Moore, who serves on the group’s economic development committee, said the team considered lack of preschool in the county a significant impediment to economic development.

“If you have children but you don’t have a place for those children to go while you go to work, you may not be working,” Moore said.

Employers want to know their employees’ families are taken care of, so having high-quality preschool in the county has economic impacts, Moore said.


Long-term return


In December, the county was approved for $350,000 in federal grant money from the U.S. Department of Education, he said, money which did not require local matching funds.

“Since then we’ve been doing a lot of work to see if we could in some way provide additional preschool opportunities for 600 children in our county,” Moore said.

That number captures some, if not all, of the children who don’t have access to those services, Moore said.

One option is to “pay for success,” he said, through a social investment concept. “How do you get the private sector to pay for things the public sector typically pays for?” Moore asked. “There are private investors willing to invest in these types of investments. Why not tap into that?”

Programs in other counties have addressed issues like homelessness and veterans’ services, Moore said. The initial money is private, but the private investor is paid through public dollars.

Moore said the funding could reduce the number of children who need special education when they get to the K-12 system, or prepare young children so they are better academically. Returns come over the long term.

“We go to the private sector and say, ‘Would you pay for this?’ If they say ‘yes,’ and they invest, they make some money ­— typically 5 percent,” Moore said. “If we don’t achieve the outcome — they lose their money. If they put up the money and we achieve these outcomes, we get what we want and you get a return on investment.”


Families benefit


Children could receive free universal preschool if they qualify, Van Dusen added. “It would be for those families who cannot afford preschool at this time,” she said.

Families at 300 percent of poverty level would be available to participate in the preschool program. Since income of $24,000 for a family of four is considered poverty level, a family with an income of up to $70,000 could be eligible, Van Dusen said.

Funds would “bring everybody up to a higher standard,” Moore said, working with existing local preschools to provide greater access for county children, kindergarten readiness and teacher training, among other goals.

Preschool teachers in the county make about one half what kindergarten teachers earn, he said. “That doesn’t seem right to us.”

If the program is successful, the cost of individualized instruction programs for struggling students — which can reach $20,000 per year, per child — can be significantly reduced, Van Dusen said. “If you think of that over 12 years, that adds up.”

If expenses can be reduced to $10,000 per child, she said, school districts could see savings of $120,000.

Savings could be used to cover investment costs and return. Additional savings stay with the school district, she added.

The nonprofit Social Finance, from Boston, Massachusetts, is visiting the county to discuss options, Van Dusen said.

Next steps involve meetings between investors and the community for data gathering and assessments.

The committee is in the informational phase to determine if this model or another model will work for the county in terms of enhancing preschool opportunities.

A feasibility study is expected in six to nine months, Moore said.



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