🔒Advocates press for promised pre-K funding as CT surplus in doubt

Advocates of early childhood education are calling on lawmakers and Gov. Ned Lamont to come up with a way to put $600 million into an early childhood endowment that otherwise relies on a surplus the state lacks this fiscal year. At a press conference at the Capitol on Wednesday, advocates gathered to ask for the $600 million deposit in the endowment. “We’re calling for the governor and legislative leadership to either adjust the volatility cap or address several of the potential sources of progressive revenue to create a surplus to fund the endowment this year with a $600 million deposit,” said Merrill Gay, Executive Director of the Early Childhood Alliance. Gay said they had put the number at an ambitious $600 million because of uncertainty about the economy and the U.S. war with Iran, as well as potential future cuts from the federal government. With a healthy investment in the endowment, he said, the Office of Early Childhood would be able to plan to reinvest funds, keeping providers secure. The Universal PreK Endowment received its first infusion of funding — $300 million — in 2025, taken from the state’s robust surplus. At the time, the funding mechanism was seen by some as an innovative workaround that allowed the state to set aside hundreds of millions of dollars each year toward a complex set of challenges facing early childhood education. Those funds are intended to do everything from funding more spots for low-income families and increasing worker wages to providing scholarships for aspiring educators and building infrastructure. At first glance, the state has no surplus to invest in the endowment. Rising Medicaid and fringe benefit costs and smaller-than-anticipated corporation tax receipts led Comptroller Sean Scanlon last week to project a $6 million operating deficit for this fiscal year. The shortfall represents about 1/40th of 1% of the $27.2 billion budget’s General Fund. Lawmakers and Lamont agreed last June that future deposits into the pre-K endowment would come from the operating surplus. But Connecticut also has a special savings program that holds a portion of income and business tax receipts outside the formal budget, and analysts estimate it will capture $1.8 billion this fiscal year — six times the $300 million investment that launched the pre-K initiative. That savings program is supposed to be used to build reserves and reduce Connecticut’s considerable pension debt, which still exceeds $33 billion, according to the governor’s budget office. Still, Lamont wants to bend the rules this year and take $500 million from the savings program to finance a $200-per-person, one-time tax rebate in late October, days before voters will decide whether to reelect him to a third term. But advocates say that failing to pay into the fund threatens to do more than delay promised improvements to the sector. Providers are anticipating improved pay and a July deadline when most low-income families will stop paying fees. Without the endowment, Gay anticipated a $40 million funding gap and said it could threaten more child care centers already on the brink of closure. If they do close, that could cause a ripple effect in the state’s economy, when workers have no one to take care of their children so they can get to their jobs. A spokesman for Lamont said in a statement that the governor has taken a leading role on the national stage with his investment in early childhood education. “Connecticut’s approach helps lower costs for parents and gives young children a stronger start for future learning success. He’s fully dedicated to making sure that we deliver on that vision and promise,” the statement said. The issue has been met with support on both sides of the aisle, with lawmakers seeing many ways Connecticut families and the state economy as a whole stand to benefit from the vision of the endowment. “When parents and families are already paying sometimes up to 40% of their income for child care, it’s a burden on families that we can’t afford to wait on,” said Rep. Mary Welander, D-Orange. In Manchester, a child care center abruptly closed in March and advocates warn that other centers are on the brink of extinction. “They can’t afford to keep their doors open, whether it’s through like insurance costs, or through not having enough staff and teachers who are there, it has this ripple effect that really can bog down the economy as we are going into a potential recession,” she said. House Speaker Matt Ritter, D-Hartford, also expressed support for the endowment and said that he was open to exploring where the funds might come from. “I think the more we can do to be true to our original goal and intention, which is to create the endowment, the better off Connecticut families will be in the coming years,” Ritter said. “It’s important to me that we not just let this fund disappear and go away because we want to chase 12 new concepts.” Republican leaders have criticized the surplus mechanism for funding the endowment as a fallible gimmick. Senate Minority Leader Stephen Harding, R-Brookfield, said he believes there are still redundancies in the main budget where lawmakers could find the funds for early childhood. “If this was a direct appropriation, I would have been the first one in line supporting it. There is not a greater investment than in early childhood education,” he said. “I just don’t believe in the budget gimmicks. Now we are reaping the consequences of that.”