COUNCIL-FOUNDATION JOINT MEETING AGENDA · Research on investing in early childhood is clear. The return on investment is between 7 and 10%. Every dollar invested generates returns

Board of Directors

WI Council on Children and Families and

WI Council on Children and Families Foundation

Friday, October 14, 2016 ♦ 10:45 a.m. - 2:30 p.m.

Children’s Hospital of WI Corporate Center, Suite 710

999 N. 92nd Street

Milwaukee, WI 53226

1-888-537-7715 Passcode 57335400#

COUNCIL-FOUNDATION JOINT MEETING AGENDA

10:45 Welcome and Introductions (N. Heykes)

11:00 Mission Moment – Early Learning (Dave Edie)

(Attachment: Three Smart Investments to Build Wisconsin’s Future)

(Attachment: Are We At the Crossroads for Wisconsin Child Care?)

11:30 Approval of Minutes of June 10, 2016 Meeting (N. Heykes)

(Attachment: 6/10/16 Minutes) (Attachment: 6/10/16 Actions)

WCCF Board Action: Approval of the Minutes

11:35 Foundation Board Report (D. Schultz)

11:45 Board Development Committee Report (H. Nelson)

Attachment: WCCF Board Survey

12:00 Lunch

12:30 Finance Committee Report (S. Mixtacki)

Attachment: WCCF Financial Reports through 8/31/16

Attachment: Financial Reports Memo

WCCF Board Action: Approval of the Financial Reports

12:45 Fund Development (P. Neuman)

1:00 Lease/Building Status (K. Taylor)

1:15 Equity Agenda (K. Taylor)

- Race to Equity

- Wisconsin Partnership Program

- Explorer Team Recommendations

2:00 ED Report (K. Taylor)

- Branding Status

- Faithful Citizenship (Attachment: Reducing Child Poverty in WI)

- Budget Messaging

2:20 Other Business

2:30 Adjourn

WCCF Board Action: Approval to Adjourn

Building Blocks for Wisconsin’s Future

Governor’s Early Childhood Advisory Council 2015

Recommendations to the Governor

88%of national voters believe that access to quality early childhood education is a necessity, not a luxury. 2

Early Childhood Education Facts

3billionannual cost to U.S. businesses when employees miss work due to child care problems.3

0-5age range that presents the greatest opportunity to improve the trajectory of a child’s life.

$7-10return on investment for every dollar spent on quality early learning and development. 1

1. Heckman, James, Four Big Benefits of Investing in Early Childhood Development.

2. Joughin, Charles, New Bipartisan Poll Finds Investing in Early Childhood Education is Top National Priority.

3. Shellenback, K. (2004). Child care and parent productivity: Making the business case. Linking Economic Development & Child Care Research Project. Ithaca, NY: Cornell University, Cornell Cooperative Extension. Retrieved on February 26, 2010 from http://government.cce.cornell.edu/doc/pdf/ChildCareParentProductivity.pdf

Message from the Co-Chairs

Dear Governor Walker:

On behalf of the Early Childhood

Advisory Council (ECAC), we

are pleased to recommend

three smart investments to build Wisconsin’s future. The investments outlined

in this report are the culmination of a multi-year, coordinated effort that engaged

council members and stakeholders in reviewing community need, research on best

practices, and high-impact systems that support families and their young children.

Research on investing in early childhood is clear. The return on investment is

between 7 and 10%. Every dollar invested generates returns that will stabilize

our current workforce and the workforce that is being developed in our state’s

children. Studies have shown that these investments also result in narrowing the

K-12 achievement gap, decreasing involvement in the juvenile justice system, and

increasing earnings later in life.

The ECAC is committed to promoting evidence based, high impact, smart

investments, that can improve outcomes for Wisconsin children now and into the

future. Working with partners throughout the early childhood system, we will

better meet the needs of our children today and ensure a bright future for their

tomorrows. Thank you for your consideration of these recommendations.

Sincerely,

Eloise Anderson, Secretary, Department of Children and Families

Tony Evers, PhD, State Superintendent of Wisconsin Department of Public Instruction

Double the number of children in high quality child care programs rated 4 or 5 Star under YoungStar.

YoungStar is Wisconsin’s evidenced based child care quality

rating and improvement system designed to help young children

thrive. High quality culturally responsive programs have well-

trained teachers, as well as supportive, safe, and nurturing

environments that foster lifelong learning and success.

Evidence Based: YoungStar is based on decades of rigorous studies

that defined the best combination of quality indicators and positive

child outcomes. A University of Wisconsin study published in 2015

found that YoungStar is a valid measure of quality.

High-Impact:

Decades of research demonstrates consistent short and long-term

benefits from high-quality child care and early education:

· Better academic benefits: more likely to graduate from high school,

reduced special education placements, and increase in college

enrollment.

· YoungStar helps families identify high quality child care in

their area.

Smart Investment:

Responding to YoungStar’s effectivness, George Lightbourn,

Former President of Wisconsin Policy Research Institute,

said: “...moving half of the children attending two-star centers

[programs] to five-star centers would have a significant impact.

Moving those children would create about $20 million in new

costs, however doing so would generate a $60 million a year

return in future benefits.”

1. Committee for Economic Development

YoungStar SMART INVESTMENT 1:

“Investing in quality child care today so that children start school ready to learn pre-empts a lifetime of remediation at a far higher cost.”1

Double the number of families served in evidenced-

based Family Foundations Home Visiting Programs.

Families are supported through high-quality culturally responsive,

evidence-based home visiting programs. Programming is voluntary and

helps parents develop good parenting skills to promote their children’s

healthy development, foster educational achievement and school

readiness, and keep children safe.

Evidenced-Based: Wisconsin’s Family Foundation Home Visiting

Program supports four nationally recognized, evidence-based models

that help ensure that vulnerable parents create solid foundations

that foster children’s healthy growth and development, including the

architecture of their brain.

High Impact: Rigorous studies of high quality home visiting programs

that support families with challenges have shown promising outcomes,

including:

· Reductions in the number of low-birth weight babies

· Reductions in child abuse and neglect rates by 50

percent

· Improvements in school achievement

· Increased graduation rates

Smart investment:Research has shown that high quality

programs targeted to highest risk families have a return of

up to $5.70 for every dollar invested in home visiting, due

to reduced costs of child welfare, special education, grade

retention, and juvenile justice.

Home Visiting

The Nurse Family Partnership home visiting program reduced child abuse and neglect by 50 percent

SMART INVESTMENT 2:

Expand the CETE, a public-private partnership network that supports local communities in their efforts to leverage resources to support early childhood.

One of the foundations of a strong early childhood systems is a state and local commitment to promoting quality. Wisconsin has created a network that provides communities with tools and support to support investing in early childhood programs based on their unique needs.

Evidence Based: Arizona and Iowa implemented a similar model and found that allowing each community to customize resources to meet their needs established more engagement and buy-in from investors and communities are able to leverage local partnerships and resources.

High Impact: Wisconsin has a number of existing public-private partnerships that demonstrate high impact on the community level:

· The Community Early Learning Center of the Fox Valley serves families on-site and in the broader community through collaborative programming. The capital campaign leveraged $235,000 in public dollars and $1,616,847 in private dollars.

· The Community Partnership for Children of Brown County, established in 2005, is a prevention-focused early childhood initiative with the vision that all Brown County children will be safe, healthy and ready for kindergarten. In 2014, the initiative raised $1.9 million dollars in public and private dollars in addition to in-kind supports.

Smart Investment: “Children who are healthy and ready to learn when they enter kindergarten have an extraordinarily better chance for school and life success, the marriage of public leadership and private sector resources is a win-win: public education benefits by having children prepared to learn on day one and the private sector is rewarded later by a better educated and more skilled workforce.”1

1. National Governor’s Association, Partnering with the Private and Philanthropic Sectors A Governor’s Guide to Investing in Early Childhood.

CETE

CETE is a public-private partnership network of local early childhood coalitions joined together to increase support, resources, and quality of early childhood care and education. The CETE network consists of a state hub which provides tools and support to the local coalitions in order to build capacity to leverage community resources.

SMART INVESTMENT 3:

• Double the number of children in high quality child care programs rated 4 or 5

Star under YoungStar.

• Double the number of families with young children served in Family Foundations Home Visiting Programs.

• Expand the CETE public-private partnership network that supports local communities in their efforts to leverage resources to support early childhood.

For more information on the Governor’s Early Childhood Advisory Council and the detailed budget papers that support these recommendations go to this site: http://dcf.wi.gov/ecac/default.htm

Three Smart Investments to Build Wisconsin’s Future

1July 2016

ARE WE AT THE CROSSROADS FOR WISCONSIN CHILD CARE?

Wisconsin Council on Children and FamiliesAn Early Care and Education Report // August 2016

Policies in Conflict

2

The Wisconsin Council on Children and Families is a multi-issue policy research and advocacy orga-nization promoting statewide polices that ensure a safe and healthy future for every child in Wisconsin. For more information, visit www.wccf.org.

Special acknowledgement goes to:Alliance for Early SuccessHerzfeld FoundationOscar & Elsa Mayer Family Foundation

3

Executive Summary 4

Background: 20 Year Overview 5

The Importance of a Quality Child Care System 7

The Progress and Promise of YoungStar to Improve Quality 8

The Decline of Wisconsin Shares and its Impact 11

Meeting at the Crossroads: Recommendations for Change 14

.

TABLE OF CONTENTS

Special acknowledgement goes to:Alliance for Early SuccessHerzfeld FoundationOscar & Elsa Mayer Family Foundation

4 a publication of the Wisconsin Council on Children and Families

The Wisconsin Shares child care subsidy program (WI Shares), launched in 1997 as part of new welfare reform measures, was developed to support low-income families coming off welfare going to work, and to help low-income working families stay off of welfare.

The YoungStar quality rating and improvement system began in the fall of 2010, to: (1) promote higher quality by helping programs move up through a 5 Star rating system; and (2) provide better information to parents about the quality of early learning programs that they may access for their children.

The two pillars of Wisconsin’s child care system, WI Shares and YoungStar, are out of sync. While our state has built YoungStar, which is a good thing, the WI Shares child care subsidy program—once a strong support system for children, families and child care programs—has been seriously eroded and threatens to undermine the YoungStar quality improvement efforts.

A quality child care system works by: (1) helping children thrive so they are ready for school and beyond, (2) supporting working families, (3) gaining a significant return on investment, and (4) strengthening Wisconsin’s economy. WI Shares and YoungStar together hold the possibility of meeting these important goals.

YoungStar has made a great deal of progress and also has great promise for future success in improving the quality of child care in Wisconsin. But there are obstacles to sustaining this progress. Our analysis shows that there is a big gap between the total expenses required to operate a quality program and the available revenue.

WI Shares has undergone a huge drop in the number of children participating, especially in rural areas. There has also been an almost $131 million decline in total payments to providers, and an 18% reduction in average monthly payments per child over the last 7 years. There are many reasons for this decline, but the end result is that low payment rates undermine sustainable high-quality child care.

WCCF has four recommendations to get us back on the right track for developing and maintaining a sound child care system:

1. ECAC Recommendation: Direct Support to High-Quality Programs

2. Improve Child Care Payment Rates

3. Incentives to Maintain a Quality Child Care Workforce

4. Ongoing Research

The success of YoungStar and WI Shares depends on making critical investments that prioritize child wellness. We are confident that the recommendations will lead to healthier children, stronger communities, and a vital and viable economy that benefits us all.

EXECUTIVE SUMMARY

5July 2016

BACKGROUND: 20 YEAR OVERVIEW

More than five years ago, Public Policy Forum published an extensive analysis of Wisconsin’s child care system, tracking policy from when the state reformed its welfare system into Wisconsin Works (W-2) in 1997 up to 2010. The 2010 report, Moving the Goal Posts: The Shift from Child Care Supply to Child Care Quality, documented Wisconsin’s policy shift from a primary focus on affordable child care supply to accommodate the surge of families coming off of welfare rolls to a greater emphasis on the quality of child care. The Wisconsin Shares child care subsidy program (WI Shares), launched in 1997 as part of welfare reform, was developed to support low-income families coming off welfare going to work, and to help low-income working families stay off of welfare.

The Wisconsin Council on Children and Families (WCCF) strongly supported the focus on quality, because of the strong research evidence that high-quality early learning for low-income children had impressive short- and long-term results. According to University for Wisconsin researcher Katherine Magnuson, decades of science from many disciplines all point to the same conclusion: the healthy development of young children provides a strong foundation for educational achievement, economic productivity, life-long health, and responsible citizenship. Even economists were convinced.

WI Shares funding participate in YoungStar. Child care programs not receiving WI Shares subsidies can voluntarily participate in YoungStar, but this report will focus on children, families, and child care programs that are participating in both WI Shares and YoungStar (i.e. about 75% of programs serve WI Shares subsidized children).

The Moving the Goal Posts report saw YoungStar as a major change toward an emphasis on quality, a “transformation in the underpinning of the Wisconsin Shares program.” We agree with that assessment, and this document analyzes the progress Wisconsin has made in the movement towards quality and makes recommendations to further improve quality.

Looking back 20 years, it is clear that Wisconsin has made great strides in supporting child care, with a dramatic increase in support for low-income working families and a clear shift toward quality improvement. However, this progress is at risk due to the dramatic decrease in funding over the past few years.

Wisconsin Shares: Supporting Working Families As Wisconsin revolutionized its welfare policies, the WI Shares child care subsidy program brought an extraordinary boost to help low-income families afford child care while the parents were working. The child care subsidy program now serves more than double the number of families and children than it did in 1997. WI Shares has always been able to provide subsidies to all eligible families, with no waiting list. The program requires parents to pay a co-payment based on their income, sharing part of the costs on a sliding scale. WI Shares payment rates were developed to match costs of 75% of the slots of child care businesses in each county, based on what those private programs were charging. The 75th percentile was seen as a fair measure of private market child care prices. As states developed their child care systems under welfare reform, Wisconsin’s child care subsidy program was considered one of the top state initiatives in the country. Analysts saw Wisconsin as a model with no waiting lists, fair parent copays, reasonable income eligibility policies, and adequate payment rates for participating child care providers. Most of the WI Shares subsidy program policies have remained relatively stable for 20 years, but the one glaring exception over the last seven years has been a dramatic reduction (a $131 million decline) in child care payments to providers.

Clearly, public attention to the importance of high-quality early learning was growing, and by 2010 there was strong support for improving the quality of Wisconsin’s child care subsidy program. The YoungStar quality rating and improvement system began in the fall of 2010, to: (1) promote higher quality by helping programs move up through a 5 Star rating system; and (2) provide better information to parents about the quality of early learning programs that they may access for their children. From its inception YoungStar was strongly linked to WI Shares by requiring that all child care programs receiving

“Early childhood development is like a low-risk, blue chip stock that pays extraordinary dividends that are long-lasting.”

- Arthur Rolnick, formerly director of research at the Federal Reserve Bank of Minneapolishttp://wisfamilyimpact.org/fis32

http://wisfamilyimpact.org/fis32


YoungStar: Focus on Quality–the Good News Wisconsin took a historic step to improve the quality of child care with the launch of YoungStar in late 2010. It made sense for our state to provide higher-quality early care and education to low-income children served by WI Shares, helping them to prepare for school and beyond and paying providers based on the quality of their programs.

The YoungStar system evaluates the quality of care and education provided by regulated child care providers, rating them on a scale of 1 to 5 Stars, with 5 Stars being the highest (1 Star programs are not eligible to receive WI Shares funds). The Star ratings were set using evidence-based criteria: (1) educational qualifications and training, (2) learning environment and curriculum, (3) professional and business practices, and (4) child health and well-being practices.

Early on, YoungStar ratings were linked to financial incentives through a WI Shares tiered reimbursement system, rewarding the higher-rated programs and reducing payments at lower quality. Programs rated 1 Star were prohibited from receiving Wisconsin Shares funding due to violations of health and safety standards.

The table below illustrates that there has been significant effort to improve support for higher quality programs (rated 4 Stars and 5 Stars).

Now over five years old, Wisconsin can look proudly on YoungStar and its achievements, with a remarkable increase in children served in higher-quality programs (3, 4, and 5 Star rated). YoungStar provided incentives for child care programs to improve their quality through awards for quality advancement and quality sustainability, and by supporting 4 Star and 5 Star programs through WI Share’s tiered reimbursement system. Wisconsin has one of the most robust Quality Rating and Improvement Systems (QRIS) in the nation.

Child Care Policies Now Out-of-Sync – the Not So Good News The 20-year history sets the frame for our examination of WI Shares and YoungStar over the past five years. The two pillars of Wisconsin’s child care system, WI Shares and YoungStar, are out of sync. While our state has built YoungStar, which is a good thing, the WI Shares child care subsidy program—once a strong support system for children, families and child care programs—has been seriously eroded and threatens to undermine the recent quality improvement efforts.

Tiered Reimbursement Schedule

Program Rating Increase or Decrease in Wisconsin Shares Payments

-5 percent, effective July 2012 (initially no change in 2010)

No change

+10 percent, effective July 2013 (formerly +5 percent, effective July 2012)

Prohibited from receiving Wisconsin Shares payments

+25 percent, effective January 2013 (formerly +10 percent, effective July 2012)

WISCONSIN COUNCIL ON CHILDREN AND FAMILIES

7July 2016

THE IMPORTANCE OF A QUALITY CHILD CARE SYSTEM Wisconsin’s two most important child care programs, WI Shares and YoungStar together, have great promise to meet important goals of: (1) helping children thrive so they are ready for school and beyond, (2) supporting working families, (3) gaining a significant return on investment, and (4) strengthening Wisconsin’s economy.

Quality Child Care Helps Children Prepare for School and Beyond High quality child care helps disadvantaged children develop skills needed for school and beyond, enabling them to arrive at kindergarten more intellectually and emotionally prepared than peers who have had no preschool. High quality child care helps to close the achievement gap.

Most researchers believe that teacher qualifications are the key to quality in child care. Child development experts say that the interaction between teachers and

young children has an extraordinary impact on their learning and development.

Child Care Supports Working Families Affordable high-quality child care enables parents not only to work, but to be better employees. Quality child care provides parents with more assurance that their children are safe and will be ready for school. A reliable child care system is essential to Wisconsin’s workforce, especially for low-income working families.

Helping Prevent the Achievement Gap“Taking a proactive approach to cognitive and so-cial skill development programs is more effective and economically efficient than trying to close the gap later on.”

- James Heckman, Nobel Laureate in Economics www.heckmanequation.org

Affordable Child Care Helps Poor Mothers Seek and Keep JobsA U.S. General Accountability Office study found that: (1) reducing child care costs increases the likelihood that poor, near-poor, and non-poor mothers will work; (2) providing a full subsidy to mothers who pay for child care could increase the proportion of poor mothers who work from 29 to 44 percent, and near-poor mothers who work from 43 to 57 percent; and (3) affordable child care is a decisive factor that encourages low-income mothers to seek and keep jobs.Source: http://www.gao.gov/products/HEHS-95-20

High Quality Child Care = Return on Investment Research shows that high-quality child care and education leads to lasting benefits for children, and it is particularly effective for children with high needs. Economists have found a solid return on investment

Low Child Care Payments Conflict With High Quality Goals

http://www.heckmanequation.org


for low-income children that participated in child care programs with a strong educational program. The children from low-income families enrolled in WI Shares and YoungStar can gain the most from high-quality child care. According to the Committee for Economic Development (CED), “Investing in quality child care today so that children start school ready to learn preempts a lifetime of remediation at a far higher cost, but research shows it takes very high quality child care to achieve strong outcomes.”

THE PROGRESS AND PROMISE OF YOUNGSTAR TO IMPROVE QUALITY YoungStar Progress YoungStar was launched to improve the quality of Wisconsin child care programs, with emphasis on educational qualifications, early learning environments, and child health and well-being. As of the end of July 2015, it was evident that YoungStar has had a wide impact on child care programs and children: approximately 4,000 programs participate, serving 43,613 low-income children statewide. Wisconsin’s YoungStar program is one of the most robust quality rating and improvement systems in the nation.

Dramatic Increase of Children in Higher-quality Programs YoungStar has had a striking impact on the number and percentage of children in higher-quality programs. When most child care programs under YoungStar had been rated in July 2011, 44% of children were in programs rated 3 to 5 Star. Four years later 72% of children were in those higher-rated programs, a remarkable change.

The Child Care Industry Affects Wisconsin’s Economy A reliable child care system is an essential element to a stable workforce and the economy. Access to the organized child care market increases labor force participation and supports state and regional economic growth. A 2015 study by the Committee for Economic Development (CED) showed that the Wisconsin child care industry has $829.7 million in revenue and employs 29,685 individuals, supporting an additional 11,800 jobs in other industry sectors across Wisconsin. (https://www.ced.org/childcare impact)

Most Wisconsin Children Now in Higher-Rated Child Care Programs

Source: Wisconsin Department of Children and FamiliesWISCONSIN COUNCIL ON CHILDREN AND FAMILIES

20%

40%

60%

80%

201572% of children were in programs rated 3 to 5 stars

201144% of children were in programs rated 3 to 5 stars

3 to 5 stars 2 stars

2011 2012 2013 2014 2015

Share of children receiving Wisconsin Shares in July of each year, by the star rating of the programs.

Federal Reserve Economist on Return on Investment

The cost benefit of early childhood programs has been evaluated using our most rigorous research designs. The return on early child-hood programs for at-risk families far exceeds the return on most economic investments. For every $1 invested in high-quality early child-hood programs, there is a return of $4 to $16 to program participants and to society as a whole.

- Arthur Rolnick, former Director of Research, Federal Reserve Bank of Minneapolis http://wisfamilyimpact.org/fis32

https://www.ced.org/childcareimpact

http://wisfamilyimpact.org/fis32

9July 2016

The shift for children from lower-quality programs (rated 2 Stars) to higher-quality programs (3-5 Stars) over a short period of time was impressive, but it is important to note that most of the shift was from 2 Star programs to 3 Star programs. The chart above shows nearly half of children with subsidies from Wisconsin Shares are in programs rated 3 Stars. As of July 2015, 23% of the children are in highest-quality programs (4 Star and 5 Star) a significant increase from 15% of the children three years earlier in July 2012, but still not as high as we would like it to be.

Increased Number of Programs with Higher Quality Ratings In addition, the number of programs rated at 3, 4, or 5 Stars has also increased dramatically. From June 2012 to July 2015, the percentage of programs meeting the higher-quality ratings (3, 4, and 5 Stars) has increased rapidly, from 29% to 46%. Clearly YoungStar is helping to increase the quality of child care.

The percentage of children (72%) in higher-rated programs is much higher than the percentage of child care programs (46%) largely because most children served are in group child care programs. These larger centers serve many more children than family child care programs, and group centers generally have higher quality ratings.

Can this Progress Be Sustained? While YoungStar shows promising trends, there are clear obstacles to further increase high-quality programs and to retain the 4 Star and 5 Star programs. A primary disincentive for programs to meet high quality standards is the steady decline of the core funding through WI Shares. YoungStar is heavily dependent on WI Shares funding, which has been steadily declining, coupled with policies that further reduce financial support for programs. The reductions in payments to programs create a major challenge for those striving to meet higher quality levels and for those trying to sustain high-quality programs (rated as 4 Stars or 5 Stars).

28%Two stars

49%Three stars

6%Four stars

17%Five stars

Nearly Half of Children are in 3 Star Child Care Programs


Share of children receiving Wisconsin Shares, by program star level, as of July 2015.

YoungStar Ratings of Child Care Programs Over 3 Years

Date Percent of Programs Rating 1-2 Stars Percent of Programs Rating 3-5 Stars

The number of child care programs receiving higher quality ratings have increased dramatically.

July 2012

July 2013

July 2014

July 2015

71%

62%

57%

54% 46%

43%

38%

29%



The tiered reimbursement system applies increases of 10% for 4 Star programs and 25% for 5 Star programs to support high quality programs, but the percent increases are applied to declining WI Shares payment rates. Additionally, the highest quality programs are worried about a new WI Shares policy to be implemented in 2017. Payments will be made by the parents through an Electronic Benefits Transfer card, but under the new system the total of WI Shares regular payment plus the tiered reimbursement bonus will be capped at the provider’s private pay price. It appears the result will be to reduce the copays of families using the card, but significantly reducing the tiered reimbursement quality payments, or even eliminate them.

It is expensive for programs to meet the high quality standards of 4 Star and 5 Star ratings, particularly due to the expense of attracting and retaining well-qualified teachers with reasonable compensation. Even though these high-quality programs receive subsidy payments plus quality payments for meeting high quality standards (a 10% increase for a 4 Star program and a 25% bonus for a 5 Star program), the combined funding is often well below cost for most high-quality programs.

Cost Modeling Analysis: How Much Does High-Quality Child Care Cost? The Wisconsin Council on Children and Families worked with the Wisconsin Early Childhood Association to examine the cost of high-quality child care, using a cost modeling analysis developed by the Alliance for Early Childhood Finance. The cost modeling measured revenue available (such as parent

fees and public subsidies) and expenses (such as staff costs, rent, and equipment). As the table below demonstrates, while a typicaly 2 Star program operates at a deficit, the deficit of a 5 Star program is thirty times larger (over $100,000 a year).

Not surprisingly, the analysis showed that in Wisconsin’s YoungStar child care quality rating and improvement system it costs much more to operate a 5 Star program than a 2 Star program. Typically, not only was it cheaper to operate a lower-quality program than a higher-quality one, it was also difficult to sustain higher quality standards over time without operating at a significant loss.

Higher salaries and the addition of benefits for teachers and directors were the primary reasons that costs increased as programs moved from 2 Stars to 5 Stars. (In YoungStar, 5 Star programs must have teachers with at least an associate degree.)

The analysis concluded that while YoungStar is improving child care quality, more attention to a realistic financing strategy is essential if Wisconsin is to sustain higher-rated programs with qualified staff-- the key to quality -- without making child care unaffordable for families.

If effective child care teachers and direc-tors are key to high quality child care, improved financing is crucial for child care programs to attract and retain qualified staff.

Cost Comparison of Child Care Programs

Star Level Average Cost Per Child Loss Per Child Per Year Net Loss for a Typical Program Per Year

It’s much more costly to operate a 5 Star program than a 2 Star, a major disincentive for programs to meet high quality stands.

2 Star $9,000 $63 $3,428

5 Star $11,168 $1,881 $102,335


11July 2016

THE DECLINE OF WISCONSIN SHARES AND ITS IMPACT

While YoungStar has largely been a success story, the Wisconsin Shares child care subsidy program has been in marked decline. Wisconsin Shares was established to help low-income working families afford child care while they worked, with a wide range of child care options available to them. The program was designed in 1996 during the Thompson administration as a key component of their welfare reform agenda. It was designed to reach all eligible families, and to pay fair “market rates” to the child care programs serving their children, with a reasonable affordable copay on a sliding scale paid by the families. However, in recent years fewer families and children have participated in WI Shares, payments to child care businesses are significantly below “fair market rates,” and parents often have to pay not only their copay, but also the costs of the gap between the providers’ price and reimbursement from WI Shares. According to data from a 2015 Wisconsin Child Care Market Survey, the maximum payment rates have plunged below average market prices, making it more difficult for child care programs to deliver high-quality services.

Number of Children Served by Wisconsin Shares Has Sharply Declined

Source: Wisconsin Department of Children and Families

40,000

45,000

50,000

55,000

60,000

201546,131 children, a 21% decline since 2008

200858,379 children

2008 2009 2010 2011 2012 2013 2014 2015

Monthly average of the number of children receiving Wisconsin Shares.

2008

FiscalYear

Average Children Served per month

2009

2010

2011

2012

2013

2014

2015 46,131

46,601

49,147

52,812

54,055

56,720

59,730

58,379


12,248 Less Children Participating Since State Fiscal Year (SFY) 2008, there has been a steady decline of children served in the Wisconsin Shares child care subsidy program to help low-income working families afford child care while they work. The average number of children served monthly by Wisconsin Shares has dropped by 12,248 – a 21% decline from 58,379 in SFY 2008 to 46,131 in SFY 2015.

While there may be many reasons for the drop in children enrolled in Wisconsin Shares, it is clear that fewer low-income children have access to the higher quality programs available through YoungStar (Source: Department of Children and Families, WI Shares data http://dcf.wi.gov/childcare/wishares/spfcs.htm).

The Decline of Rural Children Participating in Shares has been Most Severe Our analysis showed that the smaller the county in population, the greater the drop in children served over the five years analyzed. The 15 most populous counties have experienced a 19% drop and the percent decline gets greater the smaller the county. The least populous counties show a whopping decline of 54%. Children served by tribes show a steep decline (44%) as well.

http://dcf.wi.gov/childcare/wishares/spfcs.htm


The decline of the number of children subsidized by WI Shares in rural counties may have been affected by the sharp reduction of family child care programs available. From July 2012 to July 2015 the number of family child care programs receiving WI Shares dropped 28%. Families in rural areas often use family child care more frequently than in urban areas.

Decline in Child Care Subsidy Payments In a seven-year period, the annual total WI Shares subsidy payments have dropped by $131 million, a 36% decline, in constant dollars. In addition, the trend shows a 18% decline in payments per child over 7 years, in constant dollars.

This analysis shows that the decline in child care expenditures was not only due to a drop in children participating, but was also compounded by a significant drop in payments per child. The decline in payments per child was largely due to policy changes: a 7-year freeze on payment rates, a 5% reduction in payments to 2 Star rated programs, and increasingly paying only for attended days. The slight increase in the budget from SFY 2014 to SFY 2015 ended the freeze on payments and increased the payment rates for counties where the rates were farthest from market rates.

The Smaller the County, the Greater the Drop in Children Served


Least populated counties

Second quartile

Third quartile

Most populated counties

19%

50%

Change in number of children served by WI Shares between 2009 and 2014, by county population size.

-50%

-40%

-30%

-20%

-10%

0%

-50%

-31%-25%

-20%

Note: The amounts are for child care subsidy payments only; they do not include administration or contracted services.

Payments to Child Care Providers for Wisconsin Shares Have Dropped

Source: Wisconsin Department of Children and Families

$200

$300

$400 million

2015$238 million, a 36% decline since 2008

2008$369 million

2008 2009 2010 2011 2012 2013 2014 2015

Annual subsidy payments in millions by fiscal year, in current dollars.

2008

FiscalYear

Annual Shares Subsidy Payment

2009

2010

2011

2012

2013

2014

2015 $238

$231

$246

$281

$296

$345

$387

$369 million


13July 2016

Child Care Financing and Decline of Payment Rates Three revenue sources fund state child care in Wisconsin: the federal Child Care and Development Block Grant, the federal Temporary Assistance for Needy Families (TANF), and state dollars. The vast amount of revenue (about 90%) is from federal sources, with about 10% state funds required to match federal dollars and to show maintenance of effort. WI Shares is required to follow standards set by the federal Child Care and Development Block Grant (CCDBG). Of course states can provide more funds than those required to draw down federal funds, but Wisconsin rarely does that.

CCDBG regulations require that states (1) do regular market rate surveys that reflect the prices of child care services by geographic areas or (2) use an alternative methodology such as a cost estimation model to establish appropriate rates. Wisconsin has used market rate surveys yearly to set payment rates by county. Since the mid-1990s, Wisconsin has had a law that counties should set rates “so that at least 75% of the number of places for children within the licensed capacity of all child care providers in that county can be purchased at or below that maximum rate.” This seemed a fair approach to make sure low-income families could afford child care and most child care providers would have a fair reimbursement.

But in 2011 the law changed, giving the Department of Children and Families authority to lower costs by reducing payments to child care providers. With this change, the payment rates have been stagnant and no longer are payments meeting the 75% standard. Our recent analysis of 2016 payment rates is dramatically below the 75% standard; in fact, the rates are well below average market prices. This is not a good foundation to support high quality child care. The current practices no longer provide a reasonable payment rate for many child care providers, and the decline is particularly damaging to the highest-quality programs.

Low Payment Rates Undermine Sustainable High-Quality for Children The fact that current WI Shares pays well below private sector market rates undermines the YoungStar goals of increasing and sustaining high-quality child care for our most vulnerable children and the programs that serve them. A significant ongoing rate increase and/or an alternate financing mechanism focused on quality are necessary for Wisconsin to increase and sustain the number of the 4 Star and 5 Star programs available to children and families.

Monthly Subsidy Amounts per Child Have Fallen

Source: Wisconsin Department of Children and Families. Amounts are for child care subsidy payments only and do not include administration or contracted services.

$400

$450

$500

$550

2015$431, an 18% decline since 2008

2008$527

2008 2009 2010 2011 2012 2013 2014 2015

Average monthly subsidy payment per child by fiscal year, in current dollars.

2008

FiscalYear

Average Monthly Subsidy Per Child

2009

2010

2011

2012

2013

2014

2015 $431

$413

$417

$443

$456

$507

$539

$527



Factors Leading to the Conflict in Policies

1. Child Care Fraud: Probably the strongest impetus for the decline of Wisconsin Shares was the child care fraud that was revealed in a series of Milwaukee Journal Sentinel stories in 2008-09. Addressing fraud was a major rationale for changes in enforcement and policies implemented under both Governors Doyle and Walker. Some of the changes addressed fraud specifically, and some reduced child care spending overall. Most of the fraud uncovered was in Milwaukee, but a series of anti-fraud and belt-tightening measures ended up affecting all child care programs statewide that were participating in Wisconsin Shares, regardless of whether or not they had committed fraud. As we showed previously, the largest declines in the number of children served were in our rural, least populated areas. As often happens, efforts to correct a problem result in unintended consequences, negatively affecting solid child care programs operating in good faith and the children and families they serve.

2. Fiscal Obstacles to Quality: As the anti-fraud and cost-cutting measures were being implemented, the state also launched the YoungStar quality rating and improvement system, the most significant quality improvement initiative for child care in Wisconsin history. A top goal of YoungStar from its inception was to help children from disadvantaged backgrounds prepare for school. However, since the tiered YoungStar incentive payments were tied to the frozen Wisconsin Shares rates, the intended positive impact has been undermined. So far, for a large segment of the child care industry, the YoungStar fiscal incentives have been more than cancelled out by shrinking Shares payments.

3. Cut Funding for Other Priorities: Wisconsin had sufficient funding (most of it federal) to build YoungStar and maintain a robust WI Shares program, with payment rates to meet private sector market prices and to establish a sustainable YoungStar system. The $131 million reduction in the state budget for WI Shares could have been avoidable, or at least had a much less damaging cut. But, year after year, Wisconsin reduced child care payments and then policymakers funneled the underspending

to other purposes. In budget after budget, more federal Temporal Assistance for Needy Families (TANF) funding was siphoned away from the child care budget and through complicated budgetary maneuvers, were use for other purposes, such as tax cuts for powerful special interests.

MEETING AT THE CROSSROADS: RECOMMENDATIONS FOR CHANGE

As the hope of YoungStar is encouraging providers to increase quality, a sound funding and policy scheme is sorely needed. The crossroads for Wisconsin child care policy has led to too many crashes and contradictions. It’s time to build a more coherent system with policies that are complementary. Wisconsin has a great history of helping young children and their families, especially for those in need. Certainly we can build on our strength, so that our working families can afford child care with the assurance that their children will be safe, nurtured, and prepared for school. Here are four recommendations for developing and maintaining a sound child care system.

1. Adopt Early Childhood Advisory Council Recommendation to Provide Direct Support to High-Quality Programs Critical to achieving success is support for a reliable, stable supply of high quality programs through quality advancement awards and quality sustainability awards. In March 2016, the Governor’s Early Childhood Advisory Council (ECAC) approved three recommendations, including one to double the number of children in high quality child care programs rated 4- or 5 Star under YoungStar. The ECAC recommended an additional investment of $10 million per year to help programs reach 4 Star and 5 Star ratings, and to help sustain programs at those ratings. This approach provides a clean funding stream separate from the WI Shares payment system, going directly to high quality programs and to those striving to reach high quality standards. According to the ECAC co-chairs (Eloise Anderson, Secretary of the Department of Children and Families, and Tony Evers, Superintendent of the Department of Public Instruction), research shows that building quality early childhood programs can yield a return on investment between 7% and 10%. According to the co-chairs: “Studies

15July 2016

have shown that these investments also result in narrowing the K-12 achievement gap, decreasing involvement in the juvenile justice system, and increasing earnings later in life.” The recommendations are the culmination of a multi-year, coordinated effort, reviewing community need, research on best practices, and high-impact systems that support families and their young children. The 24 ECAC members include representatives of state departments, public schools and higher education, business, philanthropy, and key agencies and associations. WCCF strongly supports the recommendation of the ECAC to invest more in promoting quality early learning programs.

2. Improve Child Care Payment Rates If Wisconsin is serious about building a solid child care system, something has to change in the payment rate system. Low payment rates discourage programs from serving low-income children and undermine those working hard to meet high quality standards. Low payment rates often force parents to pay not only their copay, but also to cover the gap between the state payment rate and the providers’ price. Most low-income families can’t afford that. WCCF believes there are options that could be adopted to address this challenge: • Reinstate the 75% standard for setting maximum rates: for 14 years the process for setting rates worked well, giving parents a broad range of affordable choice, and child care providers receiving payments that met market rates. WCCF supports returning to the policy that county rates are set so that at least 75% of the child care slots for children can be purchased at or below that maximum rate. • Reinstate the tiered reimbursement payments process: The plan to shift tiered reimbursement quality payments to an Electronic Benefits Transfer (EBT) card for families to use in paying their child care provider has serious negative consequences. The policy will result in reducing or eliminating quality payments to 4 Star and 5 Star programs, undermining the excellent progress in increasing high-quality programs for children with high needs. Cutting payments that were originally intended to reward and sustain high-quality

programs is not a wise policy after hundreds of programs have worked hard to meet the 4 Star and 5 Star standards. The EBT card should include the regular subsidy payments only, but the card should not include the tiered reimbursement quality payments. The quality payments should go directly to the 4 and 5 Star programs to help maintain and increase the supply of high-quality programs. • Using cost modeling for setting rates: This approach is fairly recent. Instead of surveying the prices charged for child care, cost modeling estimates the costs of providing care at varying levels of quality. The focus is on quality. Such an approach might be more effective than the current system that has conflicting financing elements, namely setting county maximum rates based on price surveys and adding tiered reimbursement payments. WCCF also would support using a cost-modeling approach to setting payment rates.

3. Incentives to Maintain a Quality Child Care Workforce The quality of a child care program largely hinges on the quality of its teachers. The interactions between child and teacher are the key to learning and development. Wisconsin child care teachers and caregivers earn an average pay near $10 an hour, and teacher turnover is in the 39% range. WCCF supports strategies that include: • Expanding the REWARD Wisconsin Stipend Program with higher stipends, now administered by the Wisconsin Early Childhood Association. REWARD is an opportunity to reward and retain professionals who have attained education specific to the field, increase compensation for early childhood professionals, reduce turnover, and improve the quality of care received by Wisconsin children • Targeting professional development support for child care teachers in areas with children with highest needs, measured by low income, race and ethnicity, children with disabilities, etc. • Creating incentives such as a child care teacher student loan forgiveness option. For example, establish a program that forgives student loans for teachers after they graduate and work in the child care field for three years.


4. Ongoing Research Further research on Wisconsin Shares and YoungStar needs to be conducted to ensure that children of color have equitable access to high-quality child care.

CLOSING Wisconsin has come a long way to fulfilling a promise that all children, no matter their economic circumstances, can have access to affordable, quality early learning programs, programs that get them to the K-12 starting line “ready to go”. But that promise is threatened by funding decisions that in fact make it more likely that quality programs will fade away and that the most vulnerable children will be left “out in the cold.”

The success of YoungStar and Wisconsin Shares depends on making critical investments that will lead to healthier children, stronger communities, and a vital and viable economy that benefits us all.


R a i s i n g V o i c e s t o M a k e E v e r y K i d C o u n t

WISCONSIN COUNCIL ON

children&families

www.wccf.orgwww.facebook.com/wiskids

www.twitter.com/wiskids

Submit for board approval October 14, 2016

Wisconsin Council on Children and Families, Inc. Joint WCCF Foundation and Council Board of Directors Meeting

Wisconsin Primary Health Care Association (WPHCA) 5202 Eastpark Blvd. - Suite 109 - Madison, WI 53718

Friday, June 10, 2016 10:00 a.m. - 2:30 p.m.

1-888-537-7715 Pass Code 57335400# Present: President Helene Nelson, Vice President Nancy Heykes, Secretary Sandi Tunis, Treasurer Steve Mixtacki; WCCF Board members Julie Aulik, Jacquie Boggess, Mary Haffenbredl, Sarah Inman, Celia Jackson, Sheri Pattillo Johnson, Michele Mackey, Donald Maurer, Harry Ogden, and Sue Vincent; WCCF Foundation President Donald F. Schultz, WCCFF Board Members Anne Arnesen, and Keith L. Johnson; WCCF Executive Director Ken Taylor, Deputy Director Jim Moeser, and Office Manager Barbara Zuccarello.

Absent: WCCF Board Members Tonya Brito, Missy Jacobus MacLeod, Lucia Nunez, Mary Rohrer, and Joe Wall. 1. Welcome/Call to Order (H. Nelson)

WCCF President H. Nelson called the Friday, June 10, 2016 Joint WCCF and WCCF Foundation Board meeting at Wisconsin Primary Health Care Association to order at 10:10 a.m.

2. Audit Report (S. Mixtacki). See “Audit–Board Communications Letter,” “Audit-Management Representation Letter,” and “Audit Report 12-31-2015 and 2014” appended to these minutes. S. Mixtacki summarized the results of the Audit Report. - Auditors reported that staff cooperation was good, and that the result of the audit was an unqualified opinion—a clean opinion (the best--preferred). - There were no instances of non-compliance related to internal controls, grants, etc. There were no disagreements with management. There were no defects with internal controls. - Page 5, Consolidated Expenses reflects that 90% of expenditures were on mission, 7.5% management, and 3% on fundraising. K. Taylor noted that S. Mixtacki had caught a three word error in the footnote of the audit report, and that that level of oversight inspired confidence. S. Mixtacki and J. Moeser thanked all staff. A MOTION was made by M. Haffenbredl to accept the Audit report as presented at this meeting. The motion was seconded by S. Tunis, and passed unanimously.

WCCF Board Meeting DRAFT June 10, 2016

Page 2 of 10

3. Finance Committee Report (S. Mixtacki). See “WCCF N4N Financial Reports through 3-31-16.” S. Mixtacki reviewed the financial reports noting that the format had been changed to better summarize financial information for the board on one page (what had previously been presented as several pages). At the first quarter of 2016, we are a bit ahead of budget due to a staff change that was made in the Communications area. K. Taylor reported on grant activity. There was progress in the first quarter and additional progress in the second quarter. There has been some interest in WCCF for a project that would be a good start on filling the $132,000 hole in the budget (unknown source income we have to identify in each budget year); we are certain of $80,000, and becoming more confident that WCCF could end 2016 in the black. J. Moeser noted that a few grants will carry over into 2017; some funders understand the need to present two-year grants to lessen challenges to organizations. WCCF is currently pursuing a 5-year grant. A MOTION was made by N. Heykes to approve the financial statements presented at this meeting. The motion was seconded by S. Vincent, and passed unanimously.

4. Approval of Minutes. See “WCCF March 11, 2016 Minutes” and “WCCF March 11, 2016 Actions.” A MOTION was made by S. Johnson to approve the minutes from the March 11, 2016 meeting. The motion was seconded by M. Mackey, and then passed unanimously.

5. Executive Committee Report (H. Nelson). a. Resolution to Create a Committee on Board Development. See “Resolution Creating a Committee on Board Development” appended to these minutes for language formalizing the function of this new committee. Notes from the pre-vote discussion included: - The Executive Committee has endorsed this resolution. The resolution was prepared by H. Nelson and incoming Board President N. Heykes and represents an evolution of the prior Board Nominations Committee. H. Nelson briefly reviewed the resolution. - The members of this committee will be appointed by the Board President and could include non-board members (WCCF) for their expertise (as could any committee). - Board development will take a year-round approach to both board and


Page 3 of 10

committee development. This committee will pay attention to diversity in many facets, for example, geographic diversity; also, ways to engage and bring on younger folks as well as a way to connect with folks in communities we are working in as WCCF evolves and grows. A MOTION was made by N. Heykes to establish a new WCCF Board committee: Board Development Committee. The motion was seconded by M. Haffenbredl, and passed unanimously. b. Resolution on Equity. See “Resolution on Fostering Equity (Amended and Approved by the WCCF Board of Directors on 6-10-16)” appended to these minutes. S. Johnson noted that this resolution insures that the Explorer Team report shall be used to inform and guide WCCF in keeping focus on the mission critical work of equity. This work is to be incorporated into the everyday work of WCCF--enfolded into all that WCCF does. The Executive Committee, the Executive Director, and the Board Development Committee shall be accountable for the directives of this resolution being carried out going forward. There was a lengthy conversation about the resolution and accountability. Comments included: - This resolution will work and hold us accountable. - The resolution will be a guide for how we measure what we’ve done. - The first draft of the resolution had content drawn from the Explorer Team’s report to the Board. There was much discussion on our level of accountability. Going forward, the Executive Committee will bring equity matters up at every meeting and will review process/outcome issues. Equity work will be discussed throughout the rest of 2016 with the intention of deciding how to advance progress/goals in 2017. - Setting a date for a work plan to be completed would be one step closer toward taking action versus talking about action that needs to be taken. - It is always a challenge to recognize where different people are coming from and where the group is at collectively; theoretically, it can be assumed all are on board, but the reality can be challenging; folks will be challenged in ways they don’t anticipate; process will begin to tease that out; need to create a process where people are comfortable while being challenged. - It always feels good to say the words; everyone needs to be on board when action needs to be taken. Growth is not linear (ahead/behind, experienced/not experienced); we all need to figure out where we are ready to speak out to others (make them uncomfortable); we are all learning. - It was suggested that a Board assessment tool to measure board member knowledge, attitudes, and beliefs around equity might be helpful to measure and gauge where the Board is as a whole. Individual attitudes around social justice and racial equity don’t necessarily translate into action that is needed. - Goal is individual growth and growth as a group (Board) toward equity. - Strategies need to be developed to engage people to work on this heart and


Page 4 of 10

soul. - The work to be done includes a staff component, joint staff and board learning, and work externally; we need to be thoughtful about when these should overlap and when they should be separate. - The resolution is about active commitment and active mutual trust to work together as a Board in this direction. - Are we worthy of trust from organizations we have not worked with yet? - J. Aulik asked that the minutes reflect the following: We are actively holding ourselves accountable; we are in different places; we will attend to this at every board meeting (learning/pacing/action/results); it is our duty to take action. - It was agreed that developing an intensive, comprehensive work plan by the end of 2016 was unrealistic, but that it would be possible to develop a more general plan or framework, identifying priority objectives for 2017, between now and the December board meeting. A certain level of detail is needed to demonstrate that progress is being made. A board assessment is already something that the newly formed Board Development Committee will undertake. After lengthy consideration of the resolution, it was agreed to amend the second and third to the last paragraphs of the Resolution on Fostering Equity before approving it. A MOTION was made by S. Johnson to amend the proposed Resolution on Fostering Equity. The second and third to the last paragraphs of the resolution shall be amended to read as follows: THE BOARD DELEGATES to the Executive Committee the responsibility to work

with the Executive Director on a work plan (to be completed for presentation to the

Board by December 2016) that identifies priority objectives for the coming year for

this work.

THE BOARD DELEGATES to the Board Development Committee responsibility to

plan and support the Board’s own work to learn, engage and diversify our

membership, including implementing a Board self-assessment, so the Board can

lead WCCF strategy for equity and family economic success most effectively.

The motion to amend the Resolution on Fostering Equity was seconded by N. Heykes and passed unanimously. A MOTION was made by S. Johnson to approve the Resolution on Fostering Equity (as Amended and Approved by the WCCF Board of Directors on 6-10-16). The motion was seconded by N. Heykes, and passed unanimously (see amended resolution appended to these minutes).


Page 5 of 10

c. Approve J. Aulik as an At-Large Member of the Executive Committee for the Remainder of 2016. J. Aulik graciously accepted appointment as At-Large Member of the Executive Committee. A MOTION was made by S. Mixtacki to appoint J. Aulik as At-Large Member of the Executive Committee for the remainder of 2016, effective immediately. The motion was seconded by S. Tunis, and approved unanimously. d. Approve Tony Baez on the WCCF Board for a 2.5 year term, July 1, 2016 through December 31, 2018. See “Tony Baez Bio.” A MOTION was made by N. Heykes to approve appointment of Tony Baez to the WCCF Board for a 2.5 year term, July 1, 2016 through December 31, 2018. The motion was seconded by M. Mackey, and approved unanimously.

6. Foundation Board Report (D. Schultz). See “ESG doc from First Business.” D. Schultz reported on Foundation board history, financials and activities to date: - As of 5/31/16 the market value of the portfolio was $576,733.37. - The fund managers warned that 2016 will be a volatile year and advised the Board to think long-term. The fund started with $476,000 from Frances Hurst’s home in 2004, and the current value is $100,000 above that amount despite distributing $200,000 to the work of the Council. Frances Hurst was an active member of the Madison community. She and A. Arnesen were allies on many concerns. - The investigation of socially responsible investing (SRI) was initially suggested by H. Nelson eighteen months ago. The current term for this type of investing is ESG (Environmental, Social, and Governance). The Foundation Board formed the Investment Committee to explore responsible SRI/ESG investment options. The Foundation’s current manager, First Business Investment and Trust, did not offer any options at the outset, but they do now. Valuing the work that First Business team has done for the portfolio, the Investment Committee feels FBTI options are worth exploring. K. Johnson and S. Davidson will meet with First Business manager before the Fall board meeting to discuss transferring portfolio funds to ESG investments. - Foundation funds may be needed to address problems with WCCF’s website host. - The possibility of purchasing property to address WCCF’s future office space was discussed with the Foundation Board. The Foundation Board will consider funding a building purchase.

7. Lunch and Learn Appreciation Circle for H. Nelson. This was Helene’s last meeting serving as WCCF Board President. Helene will remain on the Board and on the


Page 6 of 10

Executive Committee for the balance of 2016 per the resolution (2016 slate) adopted by the Board December 11, 2015. All shared memories and expressed gratitude to Helene for her years of service as WCCF President.

8. Branding/Naming Recommendations. (K. Taylor). K. Taylor provided an update on the branding/naming work that is in progress. See PowerPoint, “Branding Update, June 10, 2016.” Board comments/questions included: - Has this information been seen by legislators or have they been surveyed? (Ken responded that it has not—that we are not looking for that feedback at this point). - Where does the “family” piece come in? (Ken responded that it is part of the tagline). - there was a discussion about the use of the pronoun “their” in the mission/vision. - The goal for this session was to consider the proposed name (and tagline): Kids Forward. There was a range of opinion with most people being disposed to “Kids Forward” for the name with the tagline “Every Kid, Every Family, Every Community.” There was some discussion about including “Families” in the name; and also, whether a focus group survey should be done. An informal vote was taken of those present. MH: Love the proposed name and tagline; unveil at Step Forward for Kids! HN: If Council Board is comfortable with name and tagline, then external contacts may be queried on name and tagline before going ahead. Identify the name with Wisconsin (visually, or more literally, allude to WI). SI: Recommend involving focus groups.; for example, make shape of state of WI represent the “O” SPJ: The name Kids Forward is missing “Families” JA: Yes, focus group survey is needed (donors/constituents); technical/strategic aspect missing in the process CJ: We need benefit of input from partners/people we work with; get input from different parts of the state—different groups we work with. MM: This group alone is not enough to base decision on whether to move forward on. NH: Survey folks who already know us. SM: We won’t know today if we are ready to launch in September; so far the branding work has been free; we will run out of time; take back to the group that was surveyed on WCCF name. K. Taylor noted that we are looking for whether we are going in right/wrong direction so far; looking to narrowing options for Brandgarten to proceed; if we don’t feel we are at a place to go forward with pro bono, then there is more work to do. We are seeking Board input to shape up what we have so far, before we go out and test it.


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In preparation for a possible motion to approve new name and tagline, a roundtable survey was taken of board sentiments regarding the information presented today (the name “Kids Forward” with the tagline “Every Kid, Every Family, Every Community.” HN: Pass SI: Kids Forward OK (pending focus groups surveys); Every Kid. Every Family. SV: Kids Forward OK; Every Kid. Every Family. Every Day. KJ: Not ready for decision; check in with stakeholders. SM and JA: Kids Forward OK; either Every Kid. Every Family or Every Kid. Every Family. Every Community; Wisconsin missing in name. SJ: get more stakeholder input. NH: Kids Forward OK; shorter tagline: Every Kid. Every Family. Stakeholders don’t decide, we do. DM: go forward; get feedback; wants community in it. MM: move forward; get external feedback; Every Kid. Every Family. Every Day. CJ: get input on use of “kids” versus “children;” will defer to the Executive Committee on stakeholder feedback; Every Kid. Every Family. (Every Day maybe promising too much). JB: the name is less important than the work we do. HO: Note that there is a Forward Community in Dane County; likes Every Kid. Every Family. Every Community. H. Nelson summarized the feedback: “Wisconsin” should be incorporated visually or some other way into the name. All recommend testing before final decision. Taglines 2 and 5 were favored; also support for Tagline 4. “Community” could be a part of mission/vision statement if not in tagline. In conclusion, K. Taylor thanked everyone for the helpful discourse. H. Nelson noted that there was no vote taken today as people needed more information in order to make a decision. Helene suggested that N. Heykes might consider having a Board conference call before Step Forward For Kids to revisit name and tagline choice and soft launch of WCCF rebranding at SFFK. ACTION: Consider having a Board conference call before SFFK to revisit name and tagline choice and soft launch of WCCF rebranding at SFFK (Responsibility: N. Heykes).

9. Fund Development Report (K. Taylor). See “Matrix 6/3/2016.” K. Taylor provided an update in the absence of P. Neuman. - WCCF did really well with Big Share 2016, receiving $15,986 in donations.


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- Spring mailing proceeds were the worst in history (we don’t yet know why). - We need to revisit the corporate donor list shared with Board members in March 2016 as very few were submitted. The list was distributed again for Board member input. - Step Forward for Kids (SFFK) Sponsorship letters went out (asks were at or greater than the last level). - SFFK is scheduled for Wednesday, September 21 from 5:00-7:00 p.m. at the Madison Museum of Contemporary Art (MMOCA). This year, there will not be a board meeting the same day. The Fall board meeting will be held in the Milwaukee area on an October date to be determined. ACTION: Send corporate donor list electronically to all Board members next week (Responsibility: K. Taylor). ACTION: Email reminder to all Board members about SFFK commitments (Responsibility: W. Wolf). ACTION: Fill in the corporate donor list form (noting any contacts you may have); then return to K. Taylor or W. Wolf (Responsibility: All Board members). ACTION: Follow-up with all board members on WCCF Corporate Donor forms info provided (K. Taylor, W. Wolf).

10. Executive Director Goals (N. Heykes). See “ED Goals 2016.” N. Heykes shared an overview with Board members of the focus of the annual evaluation of the Executive Director. Foremost, we want to make sure important things get done, and that Explorer Team recommendations are integrated into the work of the Council. In order to meet true North goals in the midst of the whirlwind of everyday challenges, a quarter by quarter list of priorities is in the works. Ken’s feedback will be a draft of his individual and organizational goals, which are of course, interconnected. ACTION: Share and ideas/feedback on Executive Director goals and priorities with N. Heykes (All Board members).

11. Other Business. Fall Council Board Meeting. A verbal poll was taken of board member availability for Fridays in October. ACTION: Send a Doodle poll to all Council Board members to find the Friday-in-October date that works for the most people (Responsibility: B. Zuccarello).


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Faithful Citizenship. The next round will be drafting a theological statement about addressing poverty. K. Taylor shared that these meetings are hopeful and exciting for him and other participants. Mission Moments. H. Nelson noted that a recent success in the policy area of Early Education might be considered for the Mission Moment item on the October board meeting agenda. ACTION: Consider highlighting WCCF’s Early Education 2016 success via the Mission Moment for the October board meeting agenda (K. Taylor/N. Heykes). Well Wishes. H. Nelson wished J. Moeser good luck with surgery coming up, and thanked N. Heykes for the Appreciation Circle today.

12. Adjourn A MOTION was made by J. Aulik to adjourn this meeting at 2:05 p.m. The motion was seconded by M. Haffenbredl, and passed unanimously.

Appendices A. Audit Documents - Audit–Board Communications Letter - Audit-Management Representation Letter - Audit Report 12-31-2015 and 2014. B. Resolution Creating a Committee on Board Development C. Resolution on Fostering Equity (Amended and Approved by the WCCF Board of Directors on 6-10-16)


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2016 WCCF/COUNCIL BOARD MEETING/EVENT SCHEDULE AHEAD

Wednesday, September 21, Annual Fundraiser Evening (Madison) STEP FORWARD FOR KIDS 5:00—7:00 p.m. Location: Madison Museum of Contemporary Art

Friday, October 14, Board Meeting 10:45 a.m. – 2:30 p.m. Fall board meeting will be held separately from Step Forward for Kids fundraiser this year. Location: Children’s Corporate Center, 999 N. 92nd Street, Wauwatosa, WI (Suite 710 - 7th Floor Board Room). There will also be a meeting of the Board Development Committee from 9:30-10:30 a.m. in Room 760 (Corporate West Conference Room).

Friday, December 9, Winter Board Meeting Location: WI Primary Health Care Association/WPHCA (Madison) Council board meetings are generally scheduled for 10:45 a.m. to 2:30 p.m. Exact time and location of meetings to be confirmed prior to each meeting.

Action Items- June 10, 2016- Council Board Meeting

Administration ALL BOARD MEMBERS ASKED TO COORDINATOR STATUS Share any ideas/feedback on Executive Director goals and priorities with N. Heykes.

N. Heykes

OTHERS ASKED TO COORDINATOR Send a Doodle poll to all Council Board members to find the Friday-in-October date that works for the most people.

B. Zuccarello Done-October 14 is the meeting date.

Consider having a Board conference call before SFFK to revisit name and tagline choice and soft launch of WCCF rebranding at SFFK.

N. Heykes Board/staff work group call conducted.

Consider highlighting WCCF’s Early Education 2016 success via the Mission Moment for the October board meeting agenda.

K. Taylor N. Heykes

Done

Policy Priorities/Advocacy COORDINATOR STATUS ALL BOARD MEMBERS ASKED TO

OTHERS ASKED TO

Fundraising COORDINATOR STATUS ALL BOARD MEMBERS ASKED TO

Fill out the WCCF Corporate Donors list form and return to K. Taylor or W. Wolf.

K. Taylor, W. Wolf,

OTHERS ASKED TO

Send corporate donor list electronically to all Board members next week.

K. Taylor

Email reminder to all Board members about SFFK commitments.

W. Wolf

Follow up with all board members on WCCF Corporate Donor forms info provided.

K. Taylor W. Wolf

Networking COORDINATOR STATUS ALL BOARD MEMBERS ASKED TO

OTHERS ASKED TO

1

Wisconsin Council on Children and Families Board Survey – October 14, 2016 (Draft 10-7-16)

The newly-created Board Development Committee invites your suggestions and requests as we begin our

work. Please respond to any or all of the areas below to help us plan how to address each part of our

charge from the Board. Thank you for sharing your advice! H. Nelson (chair), M. Haffenbredl, C.

Jackson, and L. Nunez

OUR CHARGE: facilitate the Board’s self-evaluation of performance and capacity to serve WCCF and

its mission. (We will evaluate tools to do that evaluation more formally in the future.) QUESTION: What

area(s) of Board capacity-building is important to address early in planning for Board development?

CHARGE: review the Board's composition, including committees and terms, to identify opportunities to

strengthen expertise and diversity. QUESTION: What areas of “expertise” and “diversity” are important

to consider early, as we recruit new members and plan education programs for existing members?

CHARGE: cultivate new Board members and present nominations for Board membership. QUESTION:

Are there individuals (by name) or types of individuals you recommend we consider in 2017? Later?

2

CHARGE: develop opportunities for Board education and engagement to strengthen the overall

effectiveness of the Board. QUESTION ONE: What areas of new learning and approaches to learning

would help YOU PERSONALLY to be the best WCCF Board member you can be?

QUESTION TWO: What areas of learning and approaches to learning do you think are important for

THE BOARD IN GENERAL to be the best WCCF Board we can be?

QUESTION THREE: Are there resources you recommend to us for our work in Board education? Or

might you be interested in “teaching” or facilitating learning in some aspect of the work?

CHARGE: make other recommendations for Board development to serve WCCF and its mission.

QUESTION: What other suggestions or requests do you have for the newly formed Board Development

Committee to address?

YOUR NAME: _______________________________

A division of

To: Board of Directors and Management Wisconsin Council on Children and Families The accompanying financial statements and additional schedules of Wisconsin Council on Children and Families as of and for the period ended August 31, 2016, were not subjected to an audit, review or compilation engagement by us, and accordingly, we do not express an opinion, a conclusion, nor provide any assurance on them. The financial statements do not include a statement of cash flows. Substantially all disclosures required by accounting principles generally accepted in the United States are not included.

Kollath & Associates, CPA LLC d/b/a Numbers 4 Nonprofits Middleton, WI

Aug 31, 16 Aug 31, 15 $ Change % Change

ASSETSCurrent Assets

Checking/Savings1000 · Checking-First Business Bank 143,531.40 168,459.65 -24,928.25 -14.8%1150 · Milwaukee FBB 250,045.08 250,580.68 -535.60 -0.2%1120 · Money Market - Home Savings 76,479.72 76,427.96 51.76 0.1%

Total Checking/Savings 470,056.20 495,468.29 -25,412.09 -5.1%

Accounts Receivable1200 · Accounts Receivable 577,431.07 72,138.25 505,292.82 700.5%

Total Accounts Receivable 577,431.07 72,138.25 505,292.82 700.5%

Other Current Assets1405 · Income Earned Not Billed 2,945.00 2,945.00 0.00 0.0%1550 · Holding Account 297.00 0.00 297.00 100.0%1510 · Prepaid Expenses 15,634.99 6,354.88 9,280.11 146.0%

Total Other Current Assets 18,876.99 9,299.88 9,577.11 103.0%

Total Current Assets 1,066,364.26 576,906.42 489,457.84 84.8%

Fixed Assets1600 · Furniture & Equipment 18,105.19 18,105.19 0.00 0.0%1700 · Accumulated Depreciation -11,042.96 -9,789.49 -1,253.47 -12.8%

Total Fixed Assets 7,062.23 8,315.70 -1,253.47 -15.1%

Other Assets1850 · Unemployment Fund-Associated 13,186.47 13,098.58 87.89 0.7%1800 · FBTI - Board Designated Reserve 258,775.30 258,156.62 618.68 0.2%

Total Other Assets 271,961.77 271,255.20 706.57 0.3%

TOTAL ASSETS 1,345,388.26 856,477.32 488,910.94 57.1%

LIABILITIES & EQUITYLiabilities

Current LiabilitiesAccounts Payable

2000 · Accounts Payable 18,158.21 25,841.75 -7,683.54 -29.7%

Total Accounts Payable 18,158.21 25,841.75 -7,683.54 -29.7%

Credit Cards2102 · US Bank CC 1,434.65 763.46 671.19 87.9%

Total Credit Cards 1,434.65 763.46 671.19 87.9%

Other Current Liabilities2145 · Due to Foundation 1,000.00 91.00 909.00 998.9%2500 · Accrued U.C. Expense 6,720.00 6,720.00 0.00 0.0%2350 · Accrued Vacation 21,643.41 17,262.74 4,380.67 25.4%2170 · Advances-Deferred Revenue 0.00 4,166.66 -4,166.66 -100.0%2300 · Payroll Liabilities 12,935.05 3,151.75 9,783.30 310.4%

Total Other Current Liabilities 42,298.46 31,392.15 10,906.31 34.7%

Total Current Liabilities 61,891.32 57,997.36 3,893.96 6.7%

Total Liabilities 61,891.32 57,997.36 3,893.96 6.7%

Equity3150 · Designated Operating Reserve 258,775.30 258,156.62 618.68 0.2%3300 · Temp Restricted Net Assets 729,249.96 241,996.75 487,253.21 201.4%3900 · Undesignated Net Assets -97,275.95 288,293.47 -385,569.42 -133.7%Net Income 392,747.63 10,033.12 382,714.51 3,814.5%

Total Equity 1,283,496.94 798,479.96 485,016.98 60.7%

TOTAL LIABILITIES & EQUITY 1,345,388.26 856,477.32 488,910.94 57.1%

3:25 PM Wisconsin Council on Children and Families Inc.

09/16/16 Statement of Financial Position ComparisonAccrual Basis As of August 31, 2016

Page1

Jul - Aug 16 Budget $ Over Budget Jan - Aug 16 YTD Budget $ Over Budget Annual Budget

Ordinary Income/ExpenseIncome

4055 · Cost Sharing Grant 5,000.00 12,000.00 -7,000.00 22,500.00 42,000.00 -19,500.00 66,000.004304 · Contractual Services 18,858.08 17,500.00 1,358.08 94,124.20 70,000.00 24,124.20 105,000.004162 · Event Income 13,225.00 13,225.00 0.00 20,685.50 20,225.00 460.50 65,000.004200 · Contributions 2,577.21 6,000.00 -3,422.79 62,463.48 33,000.00 29,463.48 80,000.004306 · Grants Release from Temp Rest 195,333.36 146,780.00 48,553.36 617,390.70 614,370.00 3,020.70 907,930.004319 · Total Honorariums 0.00 550.00 -550.00 0.00 2,200.00 -2,200.00 3,300.004350 · Interest Income 297.92 100.00 197.92 1,755.08 1,100.00 655.08 2,000.004750 · Miscellaneous Income 444.45 0.00 444.45 1,977.08 0.00 1,977.08 0.004950 · Administrative Fees 4,418.84 3,833.34 585.50 17,675.36 15,333.32 2,342.04 23,000.00

Total Income 240,154.86 199,988.34 40,166.52 838,571.40 798,228.32 40,343.08 1,252,230.00

Gross Profit 240,154.86 199,988.34 40,166.52 838,571.40 798,228.32 40,343.08 1,252,230.00

Expense5797 · R2E Expenses 26,835.99 31,300.00 -4,464.01 128,110.02 150,200.00 -22,089.98 241,100.005800 · Event Expense 0.00 0.00 0.00 0.00 0.00 0.00 8,000.005000 · Administrative and Occupancy 18,138.87 16,889.66 1,249.21 74,860.37 67,683.60 7,176.77 101,798.865400 · Payroll Expense 131,287.16 140,137.84 -8,850.68 531,046.37 560,675.46 -29,629.09 840,951.145500 · Professional Fees 6,846.50 4,866.66 1,979.84 34,144.77 32,696.68 1,448.09 42,930.005600 · Program Expense 67,711.01 1,700.00 66,011.01 77,021.54 10,050.00 66,971.54 17,450.00

Total Expense 250,819.53 194,894.16 55,925.37 845,183.07 821,305.74 23,877.33 1,252,230.00

Net Ordinary Income -10,664.67 5,094.18 -15,758.85 -6,611.67 -23,077.42 16,465.75 0.00

Other Income/ExpenseOther Income

9995 · Temp Restricted Grants 337,750.00 0.00 337,750.00 1,016,750.00 0.00 1,016,750.00 0.00

Total Other Income 337,750.00 0.00 337,750.00 1,016,750.00 0.00 1,016,750.00 0.00

Other Expense8995 · Offset for Temp Restr Grants 195,333.36 0.00 195,333.36 617,390.70 0.00 617,390.70 0.005998 · Total Passthrough Activity 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Total Other Expense 195,333.36 0.00 195,333.36 617,390.70 0.00 617,390.70 0.00

Net Other Income 142,416.64 0.00 142,416.64 399,359.30 0.00 399,359.30 0.00

Net Income 131,751.97 5,094.18 126,657.79 392,747.63 -23,077.42 415,825.05 0.00

5:39 AM Wisconsin Council on Children and Families Inc.

09/16/16 Statement of Financial Activities Budget PerformanceAccrual Basis July through August 2016

Page2

Jan - Aug 16 Jan - Aug 15 $ Change % Change

Ordinary Income/ExpenseIncome

4399 · Other Grant Income 0.00 4,950.00 -4,950.00 -100.0%4055 · Cost Sharing Grant 22,500.00 22,500.00 0.00 0.0%4304 · Contractual Services 94,124.20 126,070.68 -31,946.48 -25.3%4162 · Event Income 20,685.50 33,750.00 -13,064.50 -38.7%4200 · Contributions 62,463.48 60,836.44 1,627.04 2.7%4306 · Grants Release from Temp Rest 617,390.70 604,072.46 13,318.24 2.2%4319 · Total Honorariums 0.00 2,594.60 -2,594.60 -100.0%4350 · Interest Income 1,755.08 1,620.52 134.56 8.3%4750 · Miscellaneous Income 1,977.08 573.70 1,403.38 244.6%4950 · Administrative Fees 17,675.36 17,675.36 0.00 0.0%

Total Income 838,571.40 874,643.76 -36,072.36 -4.1%

Gross Profit 838,571.40 874,643.76 -36,072.36 -4.1%

Expense5797 · R2E Expenses 128,110.02 141,593.53 -13,483.51 -9.5%5000 · Administrative and Occupancy 74,860.37 69,090.25 5,770.12 8.4%5400 · Payroll Expense 531,046.37 467,157.13 63,889.24 13.7%5500 · Professional Fees 34,144.77 31,034.06 3,110.71 10.0%5600 · Program Expense 77,021.54 28,913.21 48,108.33 166.4%

Total Expense 845,183.07 737,788.18 107,394.89 14.6%

Net Ordinary Income -6,611.67 136,855.58 -143,467.25 -104.8%

Other Income/ExpenseOther Income

9995 · Temp Restricted Grants 1,016,750.00 477,250.00 539,500.00 113.0%

Total Other Income 1,016,750.00 477,250.00 539,500.00 113.0%

Other Expense8995 · Offset for Temp Restr Grants 617,390.70 604,072.46 13,318.24 2.2%5998 · Total Passthrough Activity 0.00 0.00 0.00 0.0%

Total Other Expense 617,390.70 604,072.46 13,318.24 2.2%

Net Other Income 399,359.30 -126,822.46 526,181.76 414.9%

Net Income 392,747.63 10,033.12 382,714.51 3,814.5%

5:31 AM Wisconsin Council on Children and Families Inc.

09/16/16 Statement of Financial Activities ComparisonAccrual Basis January through August 2016

Page3

Date: 10/8/16 To: WCCF Board of Directors From: Ken Taylor Subj: Financial Reports This memo summarizes the financial reports through the end of August, 2016. As you will see,

we are beginning to run a deficit (-$6641), which we knew was likely at this point and is not a surprise. The good news is that it is a smaller deficit than we had budgeted for (which is based on a balanced budget). On the Statement of Financial Position you may notice some big numbers in Accounts Receivable and Temp Restricted Net Assets. These are because of new awards secured which haven’t been paid or are multi-year (like Kellogg). Besides Kellogg ($150k of $300k outstanding at 8/31/16), there is Alliance for Early Success ($125k), R2E 16-17 ($200k), and two months of WRAP (July invoice wasn’t paid ‘til September 14th). The receivables have a direct correlation to unspent money (Temp Restricted Net Assets) and we will release them over the upcoming months.

The other thing you might notice is a big change in the Program Expense line. This is due to the configuration of the Kellogg grant, where $60k (of $150k total) is used for subcontractors. This was not a grant we budgeted for. I also want to point out that there has been a restatement of the previous financials. Based on instructions I gave Nick at the beginning of the year, he was expending two grants supporting R2E (total $50,000) at 1/12 per month. In reality, we have not expended that funding yet. We plan to spend it by the end of the year, but since we haven’t spent it yet, I asked Nick to back it out. This made a $29k difference to statements through July 31, 2016. Thanks,

Ken

Faithful Citizenship:

Reducing Child Poverty in Wisconsin

Faithful Citizenship is a collaborative initiative launched in the spring of 2014 by the Wisconsin Council

of Churches, WISDOM, Citizen Action, and the Wisconsin Council on Children and Families to mobilize

Wisconsin’s faith communities to address the growing reality of poverty in our state. Eighteen regional

forums with over 800 local religious leaders raised awareness about the breadth and depth of

Wisconsin’s poverty, looked at root causes, and gathered grassroots input on messaging, policy

solutions and long-range poverty reduction goals for our state. The next phase is a broad-based

interfaith public education and civic engagement effort to establish goals to significantly reduce

childhood poverty and racial disparities over the next decade.

I. Why is reducing childhood poverty an urgent

priority for people of faith?

The following statement was drafted by participants in the Wisconsin Faithful Citizenship

Initiative. It is being circulated for signatures by members and leaders of Wisconsin’s religious

communities.

Our Commitment as Faithful Citizens to Reducing Child Poverty in Wisconsin

As leaders and members of Wisconsin’s Jewish, Christian, and Muslim faith communities, we commit

ourselves to making the goal of cutting child poverty by half in ten years an urgent priority for

Wisconsin. In doing so, we need also to decrease racial disparities in child poverty rates.

The persistence of poverty is a moral crisis that calls us to action. Poverty is not limited by race,

ethnicity, or age. However, children are the poorest members of our communities, and growing up in

poverty has lifelong damaging consequences. Economic disparities among racial groups in Wisconsin

are greater than in the U.S. as a whole. It is therefore imperative that we work to ensure a healthy,

thriving future for all our children.

Our religious teachings about loving our neighbor and seeking justice demand that we commit

ourselves to reducing poverty. We hold in common the conviction that God has created all people in

God’s own image and for life in community. Our lives are knitted together in a network of mutual care,

respect, and responsibility. God’s abundant gifts of creation are enough to meet the needs of

everyone, and are meant to be enjoyed by all. Our scriptures tell us that we are to share God’s special

concern for the vulnerable and the marginalized. Therefore justice, inclusion and compassion for every

person in need lie at the heart of individual and social morality:

If there is among you anyone in need…do not be hard-hearted or tight-fisted toward your needy

neighbor. You should rather open your hand, willingly lending enough to meet the need,

whatever it may be. – Deuteronomy 15:7-8

[Jesus] unrolled the scroll [of the prophet Isaiah] and found the place where it was written: “The

Spirit of the Lord is upon me, because he has anointed me to bring good news to the poor. He

has sent me to proclaim release to the captives and recovery of sight to the blind, to let the

oppressed go free, to proclaim the year of the Lord’s favor.” – Luke 4:17b-19

It is not righteousness that ye turn your faces Towards east or West; but it is righteousness . . .

to spend of your substance, out of love for Him, for your kin, for orphans, for the needy, for the

wayfarer, for those who ask, and for the ransom of slaves; to be steadfast in prayer, and

practice regular charity; to fulfil the contracts which ye have made . . . . Such are the people of

truth, the God-fearing. – Quran 2:177

This is not only an individual responsibility. Unjust economic structures and social practices can create

poverty. Thus the whole community, acting through its laws and governing authorities, is charged with

ordering society so that people are not trapped in poverty. In ancient Israel, the law of Jubilee in

ancient Israel was to ensure that no one would be trapped in debt, slavery or poverty forever (Leviticus

25) and caring for the poor was an essential quality of a good ruler (Ps. 72). Jewish, Christian, and

Muslim societies from ancient times to today have had laws to protect vulnerable persons from

economic hardship.

When we turn away from the needs of our communities out of indifference or because greed and

anxiety cause us to cling to comfort and privilege, God calls us to repentance – as individuals and as a

society. At the same time, God draws us forward with visions of relationships healed in a community of

dignity, justice, and well-being for all, a world in which every child has a bright and promising future

(e.g., Isaiah 58).

Realizing this vision in our state is a shared responsibility. Many in Wisconsin today are working to lift

children out of poverty: parents and other caregivers, educators, congregations and faith-based

programs, community centers, charities, government agencies, service providers, businesses, and

social justice organizations. None, however, can solve this problem by itself. Nor can children escape

poverty apart from the adults on whom they depend. Families and individuals living in poverty are not

simply the passive recipients of private charity or government assistance, nor can they be expected to

raise themselves, unaided, “by their bootstraps.” Rather, as bearers of God’s image and members of

our communities, their voices, their efforts, and their insights must be fully part of the common effort

to overcome poverty.

The goal of reducing poverty is shared by people of many different faiths and philosophies, and we

invite all people of good will to join this effort. On behalf of our religious communities, we commit

ourselves to help lead constructive, inclusive, civil conversations among the people of Wisconsin.

Together we can find common ground and agree on effective strategies for both public policies and

community efforts.

We further commit ourselves to being part of the solution, in partnership with all persons of good will.

We will follow through on these conversations, educating ourselves about poverty and racial

disparities, supporting sound public policies and undertaking sustained and effective action in our

communities to help cut child poverty in half within ten years.

As people of faith, we must respond now to God’s call to justice, community, and compassion. The

need for action is urgent. If our children, and our state, are to realize the great promise and potential

with which God has blessed us, this work must begin today.

II. Since faith calls us to reduce poverty, how can we

move forward as a state?

This document was prepared for discussion at the Faithful Citizenship Initiative forums on poverty. It describes the provisional conclusions that emerged from these dialogues about the nature and causes of child poverty in Wisconsin, our shared moral obligation to take action to reduce child poverty, and how we can act to reduce poverty in Wisconsin through broadly agreed-upon, evidence-based policies.

Faithful Citizenship Project: Poverty Reduction Goal Our Shared Goal: The faith community believes that the people of Wisconsin need to set a goal of cutting childhood poverty in half in the next ten years. To guarantee greater equity, we also need to cut racial disparities in childhood poverty in half. These goals need to be accompanied by a commitment to evidence-based evaluation of progress. In 2014 the Wisconsin Council of Churches, WISDOM, Citizen Action of Wisconsin, and the Wisconsin Council on Children and Families launched a dialogue on poverty with faith-based leaders and congregants across Wisconsin. Our dialogues reached several provisional conclusions:

(1) Deepening poverty and economic inequality is a moral crisis that calls us to action. We must

confront our pretension of having a level playing field while 500,000 Wisconsin adults and

250,000 Wisconsin children live in poverty.

(2) High and rising rates of poverty are primarily a result of broader economic and social structures,

not individual moral failings. Most poor children live in working families.

(3) There is a collective moral obligation not only to assist individuals, but to change the social and

economic conditions which cause poverty and racial inequities.

(4) It is unconscionable that children are the poorest segment of our society, and that severe

inequities based on race and ethnicity continue. The long term negative impacts of childhood

poverty and racial inequities create intergenerational cycles that threaten us all.

(5) Effective solutions are more likely to be adopted and succeed if we focus on finding common

ground across the ideological divide, adopt evidence-based solutions from across the political

spectrum, and hold ourselves collectively accountable to measurable outcomes rather than

particular policies.

Our Shared Moral Obligation

We have all seen how a sense of moral responsibility and compassion can drive individual and group charitable efforts to alleviate the physical, psychological, and spiritual suffering which flow from poverty and racial disparities. These are praiseworthy acts that should be commended, at the same time we have the responsibility not only to treat the symptoms, but to transform the broader social and economic context that traps so many in poverty, beginning when they are children. We also believe that it is essential that this work be done in relationship and partnership between those experiencing racial disparities and poverty and those living with abundance. People who endure poverty and racial inequities have unique understanding of the challenges they pose and have a critical vantage point for seeing and implementing solutions. Working in partnership is not only the right thing to do, it is the only way we will be successful.

A Fresh Approach: Accountability to Outcomes not Policies

There is a growing consensus across the political spectrum that government has an important role to play if we are to take effective action to dramatically reduce poverty. Both progressives and conservatives accept that government is essential to creating a social and economic context where poverty is far less prevalent. Despite this seeming agreement, ideological divisions over policy create a standoff that blocks effective action. The big idea that emerged from our discussions is that we should flip the script by holding ourselves and our elected leaders mutually accountable to outcomes, rather than support for any particular set of policies. Tracking progress towards our goals can become the organizing principle for our poverty and racial equity work going forward. This will put us in a position to invest more in policies that are

working, abandon those that are not, and initiate new evidence-based policies in real time. This outcome-based approach makes it possible to include the private sector (corporations, charities, faith-based institutions, and foundations) as well as governments at all levels (federal, state and local) in the plan as contributing to measurable parts of the outcome. This approach can also make it possible for other policies not usually associated with anti-poverty efforts, like state and local economic development and tax policies, to be part of the plan with measurable contributions to the outcomes. We have reviewed a number of poverty reduction plans that span the political spectrum, including: 1) American Enterprise Institute/ Brookings – Consensus Plan to Reduce Poverty and Restore the American Dream; 2) Community Advocates – Pathways to Ending Poverty; 3) Paul Ryan’s A Better Way: Our Vision for a Confident America; 4) the UK Child Poverty Reduction target, and others. From these plans a number of common themes emerge, and based on those themes, we propose that four main strategies are adopted in Wisconsin:

1. Set child poverty reduction goals, equity goals, and timelines.

2. Develop accountability mechanisms: A robust and independent tracking and evaluation

capacity, trusted by all sides, which will make clear assessments of what is working, and what

needs to change. (e.g. the creation of a Legislative Child Poverty Bureau)

3. Implement multi-sector, evidence based strategies at the scale capable of achieving the

poverty reduction goal, including:

a. Employment and Income: help people get well-paying jobs;

b. High quality education: Increase public investment in underfunded stages of

education, particularly in the early years;

c. Strengthening families: deepening relationships and building social capital.

4. Measure progress and adjust strategies as necessary.

The first major step of our public campaign will be a faith-led effort to inspire policymakers, elected officials, and other opinion leaders and stakeholders to publicly commit to a concrete ten year goal of cutting childhood poverty and racial disparities in half. We need to hold all components of Wisconsin society collectively responsible to achieving these goals. It is the moral, just, and economically sound action to take.