President Biden signed the Consolidated Appropriations Act, 2022, into law on March 15, 2022. The funding level for programs under the Head Start Act (the Act) is $11,036,820,000, an increase of $289 million over fiscal year (FY) 2021. This increase includes $234 million to provide all Head Start, Early Head Start, and Early Head Start-Child Care (EHS-CC) Partnership grant recipients a 2.28% cost-of-living adjustment (COLA) and $52 million for quality improvement. The total appropriation also includes $6 million for Tribal College and University Head Start (TCU-HS) Partnership programs, of which $2 million is an increase over the FY 2021 funding level to supplement existing TCU-HS Partnership grants.

This Program Instruction (PI) provides information about COLA and quality improvement funds available to grant recipients and TCU-HS Partnership supplemental funding. All Head Start, Early Head Start, and EHS-CC Partnership grant recipients are eligible to receive COLA and quality improvement funding. Grant recipients subject to competition for continued funding through the Designation Renewal System (DRS) are entitled to COLA funds through the end of their current award; however, the Administration for Children and Families reserves the right to delay decisions on quality improvement funding until DRS competition decisions are final. State collaboration grants are not eligible for COLA or quality improvement funding due to the statutory cap on their funding in the Head Start Act.

FY 2022 COLA

Each grant recipient may apply for a COLA increase of 2.28% of the FY 2021 base funding level. Base funding excludes training and technical assistance funds and any one-time funding received during FY 2021.

COLA funds must be used to permanently increase the Head Start pay scale by no less than 2.28% and be applied from the start of a recipient's FY 2022 budget period, which may need to be retroactively applied. This includes salaries of current staff and the pay range of unfilled vacancies. An equivalent increase must be provided to delegate agencies and other partners to adjust their salaries and scales. Any grant recipient concerned that they cannot increase salaries for staff due to wage comparability issues should ensure public school salaries for elementary staff are included in their considerations.

Sections 653 and 640(j) of the Act provide further guidance on the uses and limitations of COLA funds. Section 653 restricts compensation to a Head Start employee that is higher than the average rate of compensation paid for substantially comparable services in the area where the program is operating. It also prohibits any Head Start employee from being compensated at a rate that exceeds that of an Executive Schedule Level II position, including employees being paid through indirect costs. Section 640(j) of the Act requires that compensation of Head Start employees be improved regardless of whether the agency has the ability to improve the compensation of staff employed by the agency that do not provide Head Start services.

Any grant recipient proposing to apply a COLA percentage less than 2.28% across its pay scale, or differential increases between delegates or partners, must justify its rationale in its application.

As specified in Personnel policies, 45 CFR §1302.90, each grant recipient is required to establish written personnel policies and procedures that are approved by the governing body and Policy Council. They must be made available to all staff. Personnel policies and procedures should be reviewed as they may contain information relevant to this COLA.

Any remaining funds may be applied to fringe benefits costs or used to offset increased operating costs in other areas of the budget. This includes increased costs in rent, utilities, facilities maintenance and insurance, contractual arrangements, vehicle fuel and maintenance, and supplies.

FY 2022 Quality Improvement

Each grant recipient will be allocated an amount of quality improvement funding proportionate to their federal funded enrollment.

A program may apply to use quality improvement funds for activities consistent with Sec. 640(a)(5) of the Head Start Act, as outlined in Attachment A, except that any amount of these funds may be used on any of the activities specified in such section. Programs are not bound by the requirements that at least 50% of the funds be used for staff compensation or that no more than 10% of funds be used on transportation. However, the Office of Head Start (OHS) strongly encourages grant recipients to prioritize investing this funding to increase compensation for staff (wages and benefits) to help recruit and retain a qualified Head Start workforce.

Adequate compensation is necessary to secure a well-qualified workforce. Retaining high-quality staff in Head Start programs can promote continuity of care for children and more positive outcomes for children and families. Currently, the low wages of Head Start staff, particularly frontline staff who work directly with children and families on a regular basis, do not align with their qualifications or the significant role they play in shaping child and family outcomes. Staff turnover in Head Start programs has increased nearly every year since 2010, and this pattern has been further exacerbated by the pandemic. Low, stagnant wages are likely a key contributor to increasing staff turnover rates.

The Head Start workforce plays a critical role in buffering the impacts of trauma on children and families by promoting resilience through stronger parent-child relationships, strong relationships between staff and children and between staff and families, and through connections to community supports. However, the formation of these key relationships is disrupted by high turnover rates and lack of frontline staff, particularly teachers, assistant teachers, home visitors, family child care providers, family service workers, and staff who provide mental and behavioral health services. Increasing staff wages to promote recruitment and retention will contribute to a more stable learning environment for children and more stable connections for families. OHS strongly encourages programs to use as much of this funding as possible to improve the compensation of Head Start staff, particularly for frontline staff as described above or positions that experience high rates of turnover and are challenging to fill.

Lastly, grant recipients should consider ongoing, sustained investments in quality improvements, as opposed to one-time investments. OHS does acknowledge that one-time investments in FY 2022 may be necessary to sustain ongoing quality improvement. Grant recipients encountering other one-time program improvement needs are invited to apply for supplemental funding as needs emerge. These separate requests are addressed by priority and subject to availability of funds.

Application Requirements for COLA and Quality Improvement Funding

Grant recipients are required to request COLA and quality improvement funds through an application in the Head Start Enterprise System. A funding guidance letter will be issued shortly to specify each funding level and additional instructions on how to apply for these funds.

TCU-HS Partnership Program Supplemental Funding

Two million dollars is available to supplement grants of existing tribal colleges and universities funded under the Act to expand their current efforts related to supporting career pathways and degree obtainment for Head Start staff in partnership with American Indian and Alaska Native Head Start agencies. Existing grant recipients will be issued a funding guidance letter and additional instructions on how to apply for funds. Supplemental funding will be awarded by the end of September 2022.

Please direct any questions regarding COLA and quality improvement funding to your regional office. Existing TCU-HS Partnership grant recipients can direct any questions on available supplemental funding to their federal project officer.

Thank you for your work on behalf of children and families.

/ Dr. Bernadine Futrell /

Dr. Bernadine Futrell
Director
Office of Head Start