• Peter Hoenig, Associate Vice Chancellor for RSSP
• Laura Keeley-Saldana, ECEP Director

• Yael Allweil, PhD student in Architecture, CKP parent
• Gilad Arnold, PhD student in Computer Science, CKP parent
• Frank Cruz, PhD student in English, CKP parent
• Joanna Doran, PhD student in Social Welfare, ITC parent
• Robby Peckerar, PhD student in Comparative Literature, Haste St Center parent

• Peter opened saying that this meeting's goal is to propose a eligibility scale for a scholarship program for continuing / “grandfathered” families in the program for next year. We first stated that we object to the view of our proposal as a scholarship program that's aimed to subsidize an already finalized fee structure (i.e., the increased rates announced by ECEP); such view already assumes that the new fees are a done deal and henceforth it will be the baseline for any further discussion, and Peter agreed. We further presented our view that a grandfathering approach is inequitable and unfair toward newly entering unsubsidized families; Peter mentioned again that given budgetary reality, he can only commit to assist continuing families and that he feels this should be his highest priority. We agreed that a longer term, uniform solution must be pursued further, and the goal of implementing it by 2009-10.

• We had further debates around the nature of ECEP's funding from the university and the proposed budget cuts. Specifically, we raised questions regarding ECEP's status as a “revenue generating” unit, which incurs (among other things) a “full costing” surcharge of 2% on its annual earnings (about $110K); it was mentioned that up to 3 years ago ECEP (like several other units) used to be exempt from full costing surcharge, but this status was revoked; it was suggested that this issue is brought into discussion with higher administration. We further argued that childcare, as opposed to (say) housing and dining, should not be considered an auxiliary service of the campus, but rather a core service/unit, and that it should be brought up to the attention of the campus leadership.

• We questioned the alternatives that were presented to higher administration in light of the proposed budget cuts; specifically, we argued that the sole alternative of “closing down a childcare center” is mostly used for rhetorical purposes so as to justify the increase of fees for unsubsidized students. We suggested that there are other compromises possible, like (a) going with a co-op based service, separating subsidized (state accredited) care from unsubsidized student/staff/faculty care, and relying on more parent hours and sparse staffing; and (b) raising fees for faculty/staff beyond the announce 4.9% increase and up to the actual market rate for comparable daycare in the area. Peter and Laura argued that they cannot increase fees beyond what they are right now, and the fees are already at the market rate; we disagreed, and asked to be sent the supporting material for this fact.The basic point we were making is that if we were to look at the flip side of the argument about the need to close a center as the only alternative to eliminating the student rate, this would mean that it is only the student population that is asked to bear the cost of keeping the center running. The raise given the faculty/staff is 4.9%, which does not compare to the 60% of the student parents.

• We shifted to discussing the actual initial proposal for an equitable student fee structure / scholarship program. We first explained the guiding principals we would like to keep in designing such a scale, namely: (1) avoid the “cliff” when moving from subsidized to unsubsidized; (2) refrain from incurring childcare costs of more than 40-45% of the gross monthly income; (3) insist that the residual income (amount left after deducting childcare expenses) increase with higher earnings, as an incentive for families not to reduce their income. We surveyed two initial proposed scales (denoted 'Yael' and 'Gilad' on the graphs) for the case of a 2-parent 2-child family, and explained the differences between them with respect to the above principals. We argued that it seems plausible to charge more than the proposed (increased) rates for high-earning families (over $7000/month), in order to compensate for the subsidy for low-earning ones.

• Peter and Laura seemed to accept the validity of the principles underlying the proposal. Both expressed their concern than completely smoothing the jump from subsidized to unsubsidized is likely to incur unacceptable budgetary implications, but agreed that further examination is required. Peter stated that he is willing to commit to raising $100-120K toward funding a scholarship program, once the actual required amount is determined.

• We argued that to complete the funding requirement and finalize the fee structure, we need (1) data of the distribution of monthly income among participating families; (2) an up-to-date survey of the “market rate” in daycares providing comparable service. Peter and Laura agreed, and Laura was to find this information for us to evaluate.

Additional issues that came up during the discussion:

• We discussed the opportunity of passing a referendum for increasing fees to support university childcare for students. We agreed that it is highly plausible to increase ECEP's funding pool substantially by passing a relatively small contribution ($5/student represent about $350K annually in funding from fees). We further agreed that this needs to be looked into as the time approaches (mid-year 2008-09).

• We insisted that all families, including subsidized families, be informed about the increase in unsubsidized fees, and encouraged to evaluate their situation for next fall and apply for scholarship in case they may end up unsubsidized (extending the application deadline). Laura argued that she would like to refrain from “causing unnecessary panic”, but we insisted that this is their moral and professional duty; Peter agreed and asked Laura to do so.

• We queried Laura about the alleged minimum unsubsidized fee clause in the CDE (California Department of Education) contract; specifically, we questioned whether this clause requires to consider the adjustment factor (x1.4 and x1.7 for toddlers and infants respectively) in determining the minimal unsubsidized fee; she said that she will find it and send it to us.

• We discussed the Corbett bill which is to increase ECEP's reimbursement for subsidized spots by 6.2%; we argued that if it is not coupled with an increase in funding for discounted unsubsidized student rates, then it is unlikely that students will support this bill as one of its implications is fewer subsidized spots and more unsubsidized ones.

• We brought up the issue of the “hidden” fee increase that occurred before Fall '07; we argued than in light of the fees before Fall '07, the new fees that will take effect in Fall '08 are in fact completing an ongoing increase of 60-114% over a period of one year. Laura admitted that this is correct, but stated that the old fees were totally unrealistic from the budgetary point of view as they are substantially below the actual cost of care. We argued that (per Peter's comment) ECEP used to break-even financially up until the construction of the Haste Center, so the old fee structure was not that unreasonable.

• We agreed to try to meet again to finalize a short-term scholarship scale (under the grandfathering principal) within the next couple of weeks, once (1) we have more data on the income distribution of (continuing) unsubsidized families; (2) we have a better understanding of the “minimal unsubsidized fee” requirement; and (3) we have an updated evaluation of “market price” for competitor childcare centers.

• We agreed to continue discussion on a long-term, equitable solutions to all student families, and derive the budgetary commitment that is necessary to support it, with the goal of implementing in 2009-10.

The graphs with the initial proposed fee structure (implemeted for the 2-parent 2-child case) are attached.

• Peter Hoenig, Associate Vice Chancellor for RSSP
• Randice Roberts, ECEP Program Relations Manager

• Gilad Arnold, PhD student in Computer Science, CKP parent
• Frank Cruz, PhD student in English, CKP parent
• Joanna Doran, PhD student in Social Welfare, ITC parent
• Miri Lavi-Neeman, PhD student in Geography, CKIC parent

• Peter opened by presenting the budget situation faced by ECEP, including the reg fee cut of 7-14% by the university (roughly amounts to $120K annually), as well as the ongoing annual deficit of $400K, and ECEP's task to find new ways to increase revenue in the following fiscal year. He stated that he just finished talking to the Chancellor and obtained a general commitment to gain additional funding necessary to cover “substantial portion of the increases” for the “core 12 families”, namely for children who are currently in the program, until they matriculate.

• We started by explaining our view of the ECEP decision making and the way the fee increase was communicated to students; specifically, we argued that we did not know about the upcoming increase until very late (mid-April) although it has been proposed and discussed in the administration since January; that the announcement went out only to a handful of families instead of all the unsubsidized families, not to mention all student families regardless of status (and explained why we think it should have); and that we received inconsistent and contradicting indications about the increase from different officials in ECEP. Peter and Randi suggested that such miscommunication was unintended and unfortunate and that they regret it.

• We then presented an analysis of the student fee structure before and after the increase, and explained what it means as far as affordability to families at various income levels (see the graphs). We elaborated on the undesirable alternatives that unsubsidized families are left with, and argued that families that relied on the sustainability of the existing fee structure in planning their academic, family, and career future are facing a major crisis.

• Peter said that he is committed to help families currently in the program and who are directly affected by the increase to go through the rest of their children's years in the program. We asked about more subtle cases, like families who may become unsubsidized next year due to a change in income, and families that expect new babies; Peter responded that these cases complicate the situation and will have to be considered carefully in any planning effort to come. We further argued that grandfathering approach is generally inequitable and discriminating towards the remaining unsubsidized families, in particular newly entering student families; Peter responded that he agrees that a long-term solution needs to apply to student families uniformly, however his immediate concern lies with the families that are currently in the program and who relied on the existing fee structure, unaware of the upcoming changes.

• We surveyed our other initiatives, in particular the GA channel to the Chancellor aimed at freezing the increase, reversing the cut, and instructing a long-term revision of the ECEP fee schedule for students. We asked Peter whether a decision to reverse the cut in reg fees to ECEP will guarantee that the fee increase will not happen; Peter responded that reversing the increase is unlikely to happen, implying (much to our surprise) that it has been considered as a means for increasing revenue regardless of the reg fee cut. We argued that it is unfair to have 10% of the families suffer the deficit incurred by a new center that serves mostly faculty and staff. Peter responded that faculty and staff will suffer a fee increase of 4-5% beginning Fall '08; we responded that this is incomparable to the 60% increase brought upon the unsubsidized students.

• Further queries regarding the actual nominal effect of a fee increase on ECEP budget led to inconclusive answers: at first, an estimate of $70K income increase was cited and associated with the residual raise in fees for the “12 families” only; a more detailed calculation, based on an average increase of $500/month/family yielded different figures. We argued that ECEP needs to consider all 20-25 projected number of unsubsidized families in calculating the relative increase in income compared to the current fiscal year, and suggested that extrapolating from the $70K estimate should lead to an increase between $110-130K. We agreed to wait for Laura's input to determine the actual amount.

• We pointed out the particularly difficult situation of international students, who are ineligible for many need-based awards (e.g. the parent grant administered by the grad division) and who are unable to increase their income due to visa limitations.

• Peter restated his strong commitment to the students (see above) and said that he would go to great length to guarantee the same level of funding to (at first) continuing unsubsidized families. He indicated that one of ECEP's main efforts currently is raising and allocating donor money towards scholarships, hopefully to be able to cover for the cut in reg fees (in other words, they are hoping to raise an additional $100-120K from donors towards this goal). He then asked us what additional ideas we can come up with to remedy the situation, in particular asking for our judgment on whether his proposed agenda is likely to lead to an equitable and sustainable solution. We responded that the assumptions made are generally discriminating most student families compared to continuing unsubsidized families. Peter suggested that we come up with an equitable solution, such that considers all possible side factors (e.g. families shifting from subsidized to unsubsidized, new babies in continuing families, etc) and propose a framework that takes them into account. He pledged to consider such proposal favorably and see how it can be adjusted to meet the actual constraints of the budget.

• As a side note, we mentioned that the option to enroll children (infants in particular) in part-time care may be crucial for some parents in order to meet their financial constraints. Peter responded that, although regulated part-time care will not be offered the following year, ECEP will accommodate a small number of families who arrive at a sharing arrangement to enjoy part-time care. He pointed that part-time care takes more resources, hence incurs more expenses, compared to full-time care, and consequently the implementation of such an option would result in part-time fees that are marginally higher than the corresponding portion of the full-time fees.

• Peter mentioned several times the pressure that is propagated through administrative pipelines, mostly due to massive letter writing from academic units, and that it is redirected at him, pressing him to arrive at some sort of an arrangement. He also stated that the Chancellor is well aware of this issue.

• Somewhat unrelated, Peter asked us whether cutting on the lunch program (as a means to reduce expenses) would be perceived acceptable by students; we responded that, although we expect that parents are willing to compromise in order to keep their fees low, it is hard to tell for sure and that the question needs to be properly addressed at all the families in the program.

• We proposed several initial “creative ideas” to engage students in helping ECEP meet its budget goals; examples included counting participation hours against writing grant proposals to assist ECEP fundraising, participation in the form of co-op style meal preparation, etc.

• On a different note, we expressed our refrain from the interaction with certain front-desk officers at ECEP in the last 1-2 years. We gave examples for impatient and unhelpful attitude towards students (unsubsidized students in particular) and requested that this will change. In particular, we asked that officers who face students will demonstrate greater commitment to finding ways to help them meet their financial constraints.

• We agreed to work on a proposal for an alternative fee structure to the existing one (w/ and w/o the increase), as well as a list factors that might affect necessary funding required by such a framework; our proposal will serve as a basis for further discussion.

• We agreed to set up a time to meet again the following week.