The overall score for this Request for Proposals is 64 percent, which makes this RFP a moderate to high risk for applicants.
This request for proposals (“RFP”) is for the implementation of Birth-to-Five Services, which provide school day and year services to ages 3 to 5 and extended day and year to ages 0 to 5. The birth-to-five system of early care and education is being redesigned to be administered through one system by the New York City Department of Education (“DOE”). This includes EarlyLearn NYC at the Administration for Children’s Services (“ACS”) and Pre-K for All and 3-K for All at the DOE.
It is important to note that this rating cannot be considered in isolation given the interdependence of the birth to five programs being put forward by the DOE. It is particularly challenging for potential bidders to fully assess the risk level when not all of the RFPs are yet public.
The goal of this RFP is “to provide children from birth to five years old with access to a high-quality early childhood program that is held accountable and supported to meet high expectations of program quality.” This new service model strives to boost greater socioeconomic integration in the classroom to promote racially diverse and inclusive schools. Providers have the option to propose for the school day and year services for pre-K and 3-K aged children and/or the extended day and year services for children ages birth to five who meet the Federal and State Child Care Block Grant eligibility requirements.
Birth-to-Five Services are complimentary to Head Start/Early Head Start and Family Child Care Networks. DOE is the contracting agency, and the anticipated contract start date is July 1, 2020.
There are many different risks in applying for this RFP resulting from the transfer of early childhood education programs to the DOE and the uncertainty in overall funding. The five key issues are listed below, but for a more extensive list, please click this link.
Although it is laudable that the City is expanding free pre-K and 3-K programs and the City is striving to establish a comprehensive birth to five early education system, a significant portion of these programs are provided by community-based organizations (CBOs) and this RFP exacerbates a substantial pay gap between teachers at CBOs and the DOE. According to the Citizens’ Committee for Children, teachers at CBOs earn $15,000 less in the first year of employment and this disparity grows as teachers gain more experience, even though many have the same training as their DOE counterparts. The RFP asks proposers to provide teachers with a BA a salary of $44,000 and those with an MA $50,000, while the DOE teachers will receive $59,000 by 2020.
Pay for Enrollment
The DOE is also moving towards an enrollment-based payment model in which monthly payments are calculated based on monthly enrollment for each service model and age group. If a provider has a monthly enrollment rate of less than 58%, they are only awarded 65% of the monthly contracted funding received. This is a risk because providers staff and build up their programs and allocate space according to the number of seats that could be filled and not depending on the number of children enrolled. The RFP also contains a disclaimer that “All payments are subject to contract registration timelines. Any delay in the contracting process may delay or prevent contract registration and disbursement of payments.” If the DOE is not committed to prompt payment and is only paying for a portion of the contract value, providers will not be able to maintain their programs. The DOE should reimburse nonprofits at a rate that addresses the full costs of a program.
Core v. Additional Hours
The RFP divides the Extended Day programs into “core hours,” which is for 6 hours and 20 minutes of each program day and “additional hours,” which is for hours outside of the core 6 hours and 20 minutes. However, early childhood education programs should be designed to ensure that participants receive the same high quality program throughout the day instead of splitting the time between core and additional hours, which defeats the purpose of equity and socioeconomic integration.
Uncertain Indirect Funding
Corresponding to the uncertainty in the amount of available funding overall, there is uncertainty in the amount of funding available for indirect costs. The uncertainty in the indirect rate makes this RFP a risk for proposers since there are large reporting, compliance and administrative burdens on the service provider that increase indirect expenses. Through the Nonprofit Resiliency Committee, a new Health and Human Services Cost Policies and Procedures Manual was developed to standardize indirect rate calculations across human services contracts. The DOE should collaborate with providers on using this manual to apply real indirect costs for these programs. The lack of alignment between actual and fundable costs put the organizations’ sustainability at risk.
Lack of Cost Escalators
This RFP is a five year contract with up to three one-year extensions. This implies that there is the risk that providers could potentially receive the same rate for eight years. Nonprofits struggle to meet rising costs as rates on contracts are not increased from year to year to address an increase in the costs of delivering services. With the current underfunding of early education programs, it is crucial that the DOE include cost escalators in their contracts.
The HSC RFP Rater assesses the feasibility, opportunities, and risk in City and State human services procurements. Rater scores are based on the RFP and related documents available to the public via New York City’s HHS Accelerator or New York State’s Grants Gateway. The rater consists of 60 questions developed and tested by a team of procurement professionals. The questions are based on information that is necessary to help prospective proposers assess risk.
Each answer is weighted based on the degree of risk inherent in the subject of the question. Answers that imply low to moderate risk are allotted points on a lower scale range compared to higher risk questions. For compound questions, the answer to both parts must be “yes” or “not applicable” to be considered low risk. Scores are calculated by adding all the question scores together. The higher the score, the greater the risk. The scoring range is from 60 to 230, with 0 percent risk equal to a score of 60 and the maximum risk score or 100 percent equal to 230 points. Users can view the answer to each question by clicking the down arrow next to each section to expand the section.
The HSC RFP Rater is not a substitute for the due diligence necessary to inform individual organization decisions.