339: The Most Innovative Childcare Funding Strategy You Haven’t Heard About Yet With Barbara Tedrow

In this episode of Childcare Conversations, you'll meet Barbara Tedrow from New Mexico, a childcare owner turned powerhouse advocate. Barbara shares how New Mexico built a truly universal childcare system, funded by an oil and gas trust fund that has grown to a whopping $11 billion! She also breaks down how the state created its own Early Childhood Department at the cabinet level, giving childcare a real seat at the table. 

Plus, she shares some genuinely sweet staff appreciation ideas. This one is packed with inspiration, listen now!

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Transcript

SPEAKER_01 0:00

Welcome to Childcare Conversations with Kate and Carrie. You've heard the rumors. There are states out there that are saying they're going to provide free childcare. Well, today you actually get to hear what that actually means from the people who actually made it happen. We are so excited to have Barbara Tedrow from New Mexico joining us, and she's going to walk us through the announcement to what had to happen after the announcement to make it actually work and benefit privately run child care programs in the state of New Mexico. Barbara, thank you so much for taking the time and joining us today. I'm so excited.

SPEAKER_02 0:45

I'm excited. Thank you, ladies. Thank you for having me on your wonderful conversation. I can't wait to get talking. Great.

SPEAKER_01 0:52

Well, so Barbara, start by just telling us a little bit how you got into childcare and we'll just start the conversation there.

SPEAKER_02 1:01

Okay. So, you know, back in 2000, um, I had become pregnant with my second child and I was working at a con Sorry.

SPEAKER_03 1:10

That was a weather warning telling me that there was flash flooding in my area. So even though I was on uh airplane mode, the alerts come through.

SPEAKER_02 1:21

The alerts come through, but that's a good thing because you don't ever want an alert not to come through. Yes.

SPEAKER_03 1:26

So sorry about that, guys.

SPEAKER_02 1:29

See, you're even the state of Texas is so excited about New Mexico, they had to send out a yeah, yeah. I got a horn blair from the state of Texas. So um I was pregnant with my second child, and I was we were looking at what do we do. The opportunity just happened to be there that uh center was selling, and I had never actually had experience in childcare. But my husband looked at me and said, Barbara, you've got a business degree. It's running a business. And that's where most people fail, is they don't know how to run the business side of it. He said, You can learn the other stuff. He said, and he was very supportive and said, and and guess what? If it doesn't work out and you fail, that's okay. We but we gotta we gotta do something. Let's try. So we took a stab and within 30 days we had it. Um, and so it was a small center, about 60 children. Um, and now today, 25 years later, I have five centers opening up my sixth. We service about 750 children. We're actually moving out of our area. We're up in Far Farmington, New Mexico, which is the four corners. Um, but we're gonna expand down to Los Lunes, New Mexico, which is about three and a half hours away. It's my hometown, it's where my husband and I both grew up in Balen, Los Lunes area. So we're kind of moving back. All of our family is still there. So I'm excited.

SPEAKER_01 2:44

Well, that's congratulations. That's that's a that's a um for most people, expansion always comes with a mixed emotion. And so this sounds like this is literally taking you home again. So how wonderful.

SPEAKER_02 2:58

And it actually leads to universal child care, how this center is coming by, which is another part of the advocacy and what we've done. So don't let me forget about to say the work of how the money I'm getting for the funding for that center correlates with expansion of universal child care in Mexico. Well, why don't we just go there?

SPEAKER_01 3:15

Okay.

SPEAKER_03 3:16

Because I mean, it has been a few years that New Mexico has been the funding envy of the other 49 states and territories, right? Because people got paid more to take care of families who were on subsidies than they could pay, than they could get parents to pay on the open market, which doesn't happen in so far as I know, any other state across the board. And so I think New Mexico has just been this, I don't know, not white whale, because a white whale is something you don't really want to catch, but it has been maybe the beacon on a hill, right? That we can solve this problem and and be able to have funding that makes sense for the families who need the most support. It didn't make sense that the families who needed the most support we got the mo the least money for. And New Mexico reversed that. And I think that's amazing.

SPEAKER_02 4:10

And it is, it is. Leading back to how I got into advocacy was when I bought the center, my licensing agent came in, and I think she could see I it was an overload, and I was like, oh, I'm trying not to tell you I don't know what I'm doing, but I don't know what I'm doing. Well, she actually looked and said, Barbara, there's a there's a group of women in New Mexico that have started the child the New Mexico Child Care Association. Uh well, it was the New Mexico Child Care Association at the time. And she said, Um, why don't I give you the name of one of them? She's a really nice lady. She's down in um truth or consequences. Her name was Repres uh Rebecca Dow. She is actually now one of our state uh representatives. She has gone from running child care centers to running for office because she was so upset at what was happening. So I called her. She, we became very dear friends. I joined the association, and I remember my very first hearing going with her to Santa Fe when she stood up in committee hearing representing the pro providers in the state of New Mexico. And she's we were fighting for a rate increase because there had not been a rate increase in 10 years. And she said it was pathetic that in the state of New Mexico, they were paying more for an animal shelter to take care of a stray dog than they were paying a provider to watch an infant in a nationally accredited center. And that stopped legislators in their track. And that is when the first year we finally got funding that year.

SPEAKER_03 5:30

And that is where I just every state needs to find out that math.

SPEAKER_01 5:39

Yeah, that's exactly what it's in their legislature. I'm like, does every state know that? Like, have you shared that with everyone? Like, that is something. Um, and it's probably still accurate. I know that there was a time where I knew the statistics on how much every state paid to animal welfare compared to what they paid for women and girls' services. So I am sure that that probably was part of that kind of research number. Um, I don't know what that number is now, but I think if you're listening, go find that out and go back and rewind and listen to Barbara say that. Go find out your state statistic or your community statistic because again, not all of these changes have to be done on a statewide level. Like some municipalities and counties can actually they can have a piece of this pie. They may not be able to do it on the grand scale that an entire state can. But we know that there are some some some well-off counties across the country who probably are spending more per day on a stray dog than they are on children.

SPEAKER_02 6:48

People love their animals, but they should love their children even more. Yeah, and I feel like the children in our state.

SPEAKER_03 6:54

That's a t-shirt. That's a t-shirt or a book. Well, and we've got we've got some listeners in like Singapore and places like that. So another place that people take really good care of their animals, and but they do have a pretty decent childcare system, also. But it would be interesting to see the math between those two.

SPEAKER_02 7:17

Um exactly. And that was really what the first time that we were able to get a a good, we finally got a raise. Um, and from there is where my advocacy started, and I just became heavily involved in the association. Um, and I love it. Um, and it's really just about storytelling. And it was about wanting to go in and tell them specifically finding your legislator, finding the ones in your area, because that's who they care about. Right. You know, they want to know, oh, you're my constituent. I got to listen to you. You know? Um, and and that's a lot of what we do, and our members do is we invite our legislators to our centers so they can see what they're talking about because they don't understand it. There is there are no, in our legislature, we have some very good childcare champions, but that is because we have educated them and made them become our champions. We've invited them to our centers. And once they come and they realize what we are doing, then they go, oh my gosh, I have to take this on. And so we have now have a whole core cohort of what legislators call themselves the early childhood caucus. They have now formed like their own early childhood caucus and they meet and they make sure that what they're getting ready for this session or what we're doing in the interim, how is this gonna affect childcare? Everything that they do in the in the state, from because everybody, not everybody, but most of the state legislators understand now, New Mexico has done a very good job at making them understand that minimum wage is gonna impact childcare. Bringing in the new Facebook um uh meta center is going to affect childcare. Because if we don't have childcare, you can you can say and swoo Amazon and say you can bring them in, but when you're gonna have to hire 800 workers, are they gonna be able to go to work? And without childcare, they can't go to work. So we've done a really good job at bringing across secretaries across the spectrum in the state of New Mexico so that they all understand how the economic is the secretary of economic development understands that he needs to be talking to the secretary of early childhood when he's gonna be. Okay, wait, wait, wait.

SPEAKER_01 9:25

So so I know that and I know what you're talking about, but real quick, frame it for folks who might be listening who don't understand. First of all, she's talking about not like your secretary at your at your elementary school. She's talking about your state levels. Um and New Mexico has something that are you guys the only one that has this? I think there's three states now. Okay, so there are three states that have this political is it an appointment or no, it's an office.

SPEAKER_02 9:55

So in your state government, you have the governor, and then she has her cabinet secretaries that run their offices underneath her that are represented by her, and they run the state. So you've got your public education department, your higher education department, your health and human services, your children, youth and families. Well, childcare was stuck under children, youth and families. Right. And we advocated and said, I'm a child care center, and just for me to run my business, I have to try to work with PED, higher ed, health and human services. I have to work with the Department of Workforce Solutions. I can't get anything done because I'm chasing my tail trying to just run my business. And then because we were under CYFD, don't get us wrong, our secretary loved childcare. But as secretary, the cabinet secretary's job for child, like children, youth, and families is the health and welfare, foster children, juvenile justice. They're dealing with all of those issues, and then they stuck childcare underneath. So we were the low man on the totem pole, and we finally fought. And through legislation, we were able to form our own department. Because the way we framed it was a child doesn't just magically need services starting at five years old. Why are we waiting? Education starts at prenatal. So the way we framed it is it's a three-legged stool. You need early childhood development for prenatal till they go to PED. Then PED takes care of them kindergarten through 12th grade. And then when they graduate, they either go into the Department of Labor of Workforce Solutions and Labor Laws or they go to higher ed. So we were missing that early age forming. So we formed our own early early childhood education and care department with our own cabinet level secretary now that gets our own funding and we don't fight for it, our piecemealing or saying, CYFD, can we have some money? When how do you fight where for childcare when you're trying to take care of foster children and you're trying to take care of domestic violence, you know, and and those sorts of things? So now we have our own.

SPEAKER_03 11:56

Yeah, I mean, we're helping develop children when they build the most neural pathways, when they build the most um muscle connections, muscle strength. Like the first five years, it's not just that you have the most motor neurons or you have the most neurons. You're building all of it in the first five years. If you don't figure out how to connect the left side of your body and the right side of your body in the first five years, you're gonna have a really hard time reading a book. You're gonna have a really hard time swinging on a swing set at school. You're gonna have a really hard time driving a car. Yes. And so I think what's interesting.

SPEAKER_01 12:37

Yeah, so I think what's interesting is Carrie brought up a good point. And I'd be curious to get your feedback on this, Barbara, because we know that in a lot of states, advocacy comes from two different perspectives. And New Mexico has managed to really hone in on that workforce perspective. And what Carrie talked about is what you often hear um early education research folks kind of bring in. And sometimes they have they hit a wall. Like the viewpoint is that you can't have an A and a B. But we know in New Mexico you absolutely can. You guys all came together to create and to educate the politicians and you know, the staff. Because we all know it's not just the politicians, right? You got to get their staff on board because they kind of talk to folks. And they're the ones that stick around the whole time, right? Like they're the ones like you've known them probably longer than you've known some of the politicians because that staff didn't necessarily change. Anyway, I'm gonna get off my soapbox there. But um, how can folks listening help the the the advocates that are advocating about the quality piece, how can they have that economic impact conversation and not be fighting with each other? Am I making sense? I'm not sure if I'm asking that correctly.

SPEAKER_02 14:02

Well, I think if you want to just tie it all together, we utilize the statistics of the return on investment and we do it across the spectrum. That there is no other industry in the state of New Mexico that you can make an investment of $1 and get a return of anywhere between 13 and 17. That doesn't happen in anything you do except high quality childcare. And the way that we frame that is my husband was a district attorney for 16 years. And when he would help me, we would go to Santa Fe and we would go to hearings together. And I would stand up and we were fighting for budget dollars. He was actually president of the New Mexico District Attorneys Association. So he would stand up because he had talked to all the other DAs and they were all in agreement and said, Well, I would much rather, and he would say this in public hearing, I'm, you know, blah, blah, president of the DA's association, and I'm here to say and help support funding for childcare. Because if that means that I don't need that funding because they are taking care of you're funding childcare, they're taking care of those children, and that means I won't see them as a 16-year-old delinquent in the juvenile justice system. And heaven forbid you put me out of a job, I'd rather be out of a job with no money. But that means the children are okay because childcare has done their job. So we went everywhere from dealing with it from juvenile justice. Then we had higher ed and PED cabinet secretaries saying that if we invest early, we catch the um developmental delays earlier, they're getting services earlier, which means we're saving dollars from PED. Let them do their job earlier, faster, and invest in them. And if that means less dollars for us or the dollars that can be utilized for the services we actually need to be doing instead of playing catch up with these children.

unknown 15:52

Yeah.

SPEAKER_02 15:53

So I love that.

SPEAKER_01 15:54

And so I know that you guys did a lot of that work on the statewide level. And I know that your state, like other states, has more than one child care association. Were you guys able to come together in some of that advocacy work? How long did it take to get you guys on the same page?

SPEAKER_02 16:13

So, really, there are there aren't a whole lot of associations. Our association, the New Mexico Early Childhood Association, represents the majority of licensed childcare centers. And then we work very closely with Rosa Barraza. She's the representative for the licensed and registered homes. And so we collaborate quite a bit because Rosa does actually own licensed centers. And her job is she takes care of the homes and trains them to become a member. You actually have to say you will become licensed, and then she will help you become licensed and actually, if you want to become a center, become a center. So the goal is to for everybody that's watching children to at least be registered or licensed in the state of New Mexico. And that that's the goal. Because we are a very rural state, just like Texas, there aren't child care centers in every community. And we know that. We know there are homes and that people want homes. When you have a very high Hispanic population like the state of New Mexico and Texas, um, and it was with myself in Balen, we didn't even have a childcare center. There wasn't a licensed childcare center because the belief was family, you stay with family, which is all fine. However, if you need homes and that's what you want, let's get them licensed. Yeah, let's get them some training.

SPEAKER_03 17:27

Let's get them some financial support. Um let's get them some network so that when they're stressed out, they have somebody else to communicate with. Because everybody who has stayed home with their children over spring break knows that you can get stressed out having even your own personal children for five days in a row without relief. And so whether you're watching your own kids, your grandkids, your nieces, your nephews, the kids from down the road, you need some of that pressure release. I was I ran a family-based program. You need a support system when you're running a family-based program.

SPEAKER_01 18:10

Well, especially because half the time they're not old enough to have a conversation with you.

SPEAKER_02 18:14

So that's right. And we would much rather, and in the state of New Mexico, what we have pushed very hard for is in the passing of this universal child care, we changed the language on what are the requirements. We're not just following the child care development block grant that you have to be working or going to school with an activity. We also wrote into state law that we are going to cover grandparents raising grandchildren. Because in the state of New Mexico, unfortunately, that is a norm. And a lot of the grandparents, they're not working. They are retired. So we didn't want that to be a hindrance for a grandparent to be able to find somebody. Because one, it's not just for the grandparent. They're doing something that they didn't expect to be doing at 60, 70, 80 years old. Yep. Number two, it's for the benefit of the child. And that's how we framed it. Regardless of who that caregiver, that child didn't choose that. And so it's not a child's fault. That child still deserves a high-quality interactions, all of those levels of care that the child needs to be kindergarten ready. So let's let them have access. So grandparents raising grandchildren, all foster children in the state of New Mexico, regardless of where they are at any space in time, can stay with a consistent provider if they want. So that a provider doesn't need a parent doesn't need to worry about, like, I just got a child. If they know that foster child was already at a Gold Star Academy, that spot is there for that foster child forever, as long as they want it. That's great.

SPEAKER_01 19:42

That that that right there just warms my heart because I've talked with families who have taken kids in emergency situations and they're having to, you know, move them around. And the child has enough stress going on that they can't articulate. And we don't want the consistency. Yeah.

SPEAKER_02 20:00

And so let the child stay at least with a Gold Star Academy for the duration, regardless of what family they're in. Because that's the majority of the day, right? Yeah. Seven to five is a majority of their waking hours. Let that consistency and those caregivers be there.

SPEAKER_03 20:16

Okay. We're already at 20 minutes and we haven't even really talked very much about universal child care, yeah. Child care. No, well, let's go ahead and take a little bit more time because um I think all of this has been useful. Um, I just, you know, I want to.

SPEAKER_02 20:33

So let me get into universal child care in my five-minute spiel about how it came about. One of the reasons we have been successful with universal child care and with child care in general is because we found a funding source. So back in 2020, Senator John Arthur Smith, who was the chair of the finance committee, wanted to do something to come up with stable funding. Well, we were very blessed. The state of New Mexico is a very oil and gas rich industry state. We're number two in the country for production. Um, so we had extra revenue. So when we did, advocates came to him and said, let's start an early childhood trust fund. So what he did was he took $300 million, wrote legislation that we're state of New Mexico isn't going to allocate a one-time dump fund of $300 million, and we're going to start an early childhood trust fund. It is run by the state investment council through the state of New Mexico. And in six years since we started this fund with a one-time, that's all the state took, $300 million. We are now today $11 billion. And that is just from that $300 million reinvesting itself, taking the oil and gas revenues, you know, um, and we are now at $11 billion. So, one, that's how we are funding universal childcare because we only get so much money from the federal government, up to four uh people that are up to what? I think 250, 300% of poverty level. I can't remember what the dollar amount is that you receive from the feds. So every other child in the state of New Mexico that is eligible for free universal child care, the state, the feds aren't paying it. The state of New Mexico is paying that for them. So there's two income streams, and that's what New Mexico has to be very diligent about when we passed Senate Bill 241 this past session was to come up with all the nuances. So what this bill did was saying we're going to make universal child care accessible to every child, regardless of income in the state of New Mexico. However, this bill put precautions and triggers into place. So that means if there's an economic downturn and there is no more money and the state is going, uh oh. So the triggers are if oil and gas hits below $50 a barrel, then that's an economic trigger. And what the trigger does was it's going to say, okay, do we need to take a look at re-implementing copies? Because in the state of New Mexico, even though child care development, they still go through the process and say, yes, you can have a copay of $400 a month. The state still pays all the copays. So the, but it's on paper, but the state pays it all. But the copay is there because if there's an economic trigger that means there isn't enough money coming in, then copays might have to come back into play. We wrote into Senate Bill 241 that parents will be given a 90-day advance notice. Hey, the state hit a downturn. The economy isn't the way that it was. We're giving you advance notice. Copays are going to have to come into play. The trigger number two is those copays will start at 900% poverty level, 800, 700. And in law, any family 600% or below will never have a copay. So even if in an economic downturn, families that are 600% of the poverty level or below will never pay for childcare in the state of New Mexico, regardless. The other economic triggers, if there isn't enough money, then we might have to go to wait lists, but you will start with school age children first, and that you have to prioritize the low-income children up to 400% of poverty. You have to prioritize children that are in the foster care system. So this whole bill went through and we were very, very diligent on making sure that we were still protecting the families that needed it the most. Yes, it's great that, you know, the family that might own a small business and is making a million dollars a year that they get free child care, but they're going to be one of the first to get copies implemented. And the copays are structured so that at, I believe it's 900 and above, they can pay no more than 50% of their copay. And then between six and eight hundred, it's 25% of their copay. So even if copies come back, you're never going to pay more than 20, 50% of your copay. So in a nutshell, that's kind of how we did it.

SPEAKER_01 24:53

I love that. I think that I'm hoping everybody, and we have currently 123 countries that listen. So even if you are not in a country that currently has this problem, I mean, it's good to know what is happening in other countries. How do other countries structure? If you're in the United States, because we have all 50 states that listen, make sure that you are paying attention. And we will have Barbara's contact information on how you can get bar, how you can find Barbara to pick their, pick her brain. Find out more of the details because she is happy to share. Um, just when the governor made the announcement, um, there was a lot of work that happened after the announcement by Barbara and her team and her volunteers to make sure that it was um structured equitably in a way that made sense. And like Barbara kind of alluded to, they put in a lot of safety measures. So those what-ifs had a backup. So there was never nobody really ever could say, well, what if Barbara and her crew had all the what-ifs? And so, Barbara, thank you so much for taking the national lead on showing the other 49 states plus territories how it should be done. Um, not just that it can be done. And, you know, I just we are definitely gonna have to have you on again, absolutely no doubt, uh, because I know that there's probably about five more stories that you could share with us on.

SPEAKER_02 26:23

We've done some great legislation in the state of New Mexico. Like we did, we um passed legislation that there is no gross receipts taxes to providers to pay any of the income coming in from child care assistance, which is now Universal Pre-K or our New Mexico Pre-K grant. Um, we're working on um exemping property taxes because once we got childcare under its own secretary and we were able to get the New Mexico Pre-K Act in law as education, then we're now able to go to our county assessor's office and all of our classrooms that are education New Mexico pre-K, like public schools, are exempted from property taxes. Yeah, so you are done. Our head, our our roles are always spinning and we're going, what can we do next? And and and the way that we look at it is okay, if PED doesn't pay property taxes, why am I paying why pay property property taxes? If PED doesn't pay gross receipt taxes on their pre-K grant, why am I paying? Because if we're providing the same services. So these are the things that you need to think about on where is if we're supposed to be equitable and providing the same services, but it's not, then we need to fix that.

SPEAKER_01 27:30

Well, and I love that. So if you've got public education, so PED is public education. So if you've got public education in your community and they aren't paying property tax on their building and they're not being taxed on that revenue source into the school district, you shouldn't be either. And Barbara, thank you so much for that little tip because I think if you're listening um to the podcast, that would be something that you absolutely can take to your school district in your county today. So with that, Carrie, what does everybody need to know?

SPEAKER_03 28:00

I mean, I think they definitely need to know that they should share this with their state associations, whether it's uh an ECA, a CCA, an AEYC, share it with the members of the board of that. And of course, make sure you're subscribed to this show and that you are subscribed to the newsletter, so that on the times you can't listen to the podcast, at least you can get a summary of what we talked about so that you can move about your daily life with a little bit more support. And um, come back and hear us or watch us in a few days. We are on YouTube, so you can come and watch our funny faces. I'll make funny faces now. Um on the YouTube channel.

SPEAKER_01 28:49

We forgot to ask Barbara our her tip. So, Barbara, the month of April, we are asking all of the guests to share their staff appreciation secret sauce. So we know that with six locations, you've got to be doing something right when it comes to staffing. And I'm sure it's not once a month, once a year, or even twice a year. What is your staff appreciation secret sauce?

SPEAKER_02 29:12

Have a marketing director that it's not just she does all of our social media, but what I tell her her second half of her or her 50-50 job is to make sure that the staff are appreciated and taken care of. So whether that is through her little notes or just showing up with some goodies or just leaving a balloon on their car because she heard about something special that they did, um, you know, and then calling them a superstar. It's all about those little things of just making sure that day in and day out, you just say thank you. And, you know, I I get it, and this is what I share, you know. I'll be standing in line at the grocery store and I'll just, you know, I'll have the the little 80-year-old man in front of me turn around and go, you just got the prettiest smile. You just made my day. And that's what I tell my, that's what I tell my teachers, just a smile. And your director's walking in with a smile and just saying, thank you. Because half the time we don't hear that and we know how stressed they are. And I know it sounds silly and it sounds cliche, but when when we do our surveys and we ask our teachers, they they could sure they love the bonuses and sure they love the money, but it's making sure and them feeling supported by their director because they're always in and out of their classroom saying, What do you need from me? You look like you just need a five-minute break. Go take a breather, go sit in your car for 15 minutes. I got this. Without that, you're never gonna have the support and people aren't gonna want to stay with you. Barbara, thank you so much.

SPEAKER_01 30:35

I love that tip. We're gonna make that that's gonna be the highlighted of that week's newsletter. So thank you so much, and we will talk to y'all in a couple of days.

SPEAKER_00 30:44

Thanks, guys. Thanks for tuning in. We love bringing you real talk and fresh insight from the world of early childhood education. Be sure to follow us on social media to stay connected and catch all of the latest episodes. And if you're planning a conference, training, or special event, Kate and Carrie would love to speak to your audience. You can learn more about their keynote sessions and workshops at kateandcary.com. If you learned something today, share the show and leave us a review below. We'll see you next time on Child Care Conversations.