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NEW CEOS COMMENT ON UNIVERSAL PRE-K

New CEOs of two of the largest child care companies in the world, analysized the impact of recent initiatives to enact "universal" pre-k programs operated through state departments of education in the the "Seventh Annual Status Report on For Profit Child Care" in the January 2004 issue of Child Care Information Exchange.

Tom Heymann, CEO of Knowledge Learning Corporation:
"I applaud efforts to extend preschool services to disadvantaged children.  There is no question how important the early years are — all children deserve the best chances possible.  The problem is that solutions being proposed are in complete conflict with the interests of the taxpayers.  These need to be redirected to make sure that the disadvantaged have plenty of solid opportunities.  

"My observation is that we have a crisis in the output of public education, not in early childhood education.  This is because early childhood education operates in a highly competitive marketplace.  Every day in our centers if we don't do a good job, our customers will walk away.  This is true for both for profit and non profit centers.  The temple where my children attended pre-school had to be just as customer-focused as a Children's World center.  The public schools on the other hand, face no such accountability.  

"Instead of current universal pre-k initiatives, I think we need to take these dollars and expand the existing subsidy system by extending thresholds of eligibility.  Families earning $75,000 a year may not need the same subsidies as families earning $25,000 do. And, families earning $75,000, as well as families earning $25,000, need to know that when their children go to public school they will not be in a class of 35 children."

Gary Graves, CEO of La Petite Academy:
"I think the initiatives have great goals and are admirable, however, the implementation is flawed.  I am not afraid of competing on a level playing field with high standards.  But the current climate is unacceptable.  To begin with, when public schools offer child care services, they do not need to comply with the same licensing requirements.  And, when states contract with private providers, they demand high staff standards but impose low reimbursement rates.  The pre-k program in Georgia has driven up costs and driven down rates.  I am concerned that Florida will go down the same path as Georgia has.  Under the current program's design, I would be hard pressed to invest in new sites in either Georgia or Florida because its very hard to get an acceptable return on that investment.  I believe if you look at the major for profits that are not franchise systems, you'll find that location counts in Georgia have declined due to closures."  

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