In a new report, Neighborhood Villages looks at how much high-quality care for children actually costs.

The bad news? There’s a “true cost” gap. What Massachusetts pays for subsidized child care is thousands of dollars less than the costs of running high-quality programs, which means children can end up in programs that lack vital resources.

Understanding this gap, “is the first step to rectifying a very broken funding model for the child care sector,” according to the report, High-Quality Early Childhood Education: Opening the Books on its True Costs.

Among the report’s specific findings:

“… if early educators were paid fair wages and providers were staffed to quality capacity,” the report says, “an annual cost of high-quality care per child ranges from $16,417 per year for a preschooler in center-based care in Western Massachusetts to up to $49,916 per year for an infant in center-based care in Metro Boston.”

The table below shows how the gap plays out across age groups and regions. 

The report also calculates the cost of different levels of quality (higher pay and higher pay with additional staff) for infants, toddlers, and preschoolers.

To come up with these estimates, Neighborhood Villages drew on interviews with providers and a cost estimate study that was commissioned by the Massachusetts Department of Early Education and Care and conducted by the Center for Early Learning Funding Equity (CELFE) at Northern Illinois University.

The “true cost” gap is particularly challenging for certain groups. As the report notes:

“While there is a gap for all providers between what they are currently spending and what they would like to spend (to account for desired quality services and a $26/hour wage floor), the gap… is greater for providers serving high-poverty populations as compared to those serving low-poverty populations.”

The report also shares case studies about individual providers and how they balance revenue and expenses. One provider has their own gap: an annual operating deficit of more than $16,000. To fill this financial hole, the provider relies on the state’s Commonwealth Cares for Children (C3) Grants.

Some programs that serve wealthier families are able to close similar gaps by running annual fundraising campaigns.

However, to address the needs of all families at all income levels, it’s up to Massachusetts to invest more in the care of young children. As the report concludes,

“Unfortunately, families cannot afford to cover the true cost of high-quality care for their children. Rather, a substantial commitment of additional public funds is required to bridge the gap.”