PORTLAND, Ore. (KOIN) — On August 29, the Multnomah County Board of Commissioners advanced a proposal to delay a planned 0.8% tax increase for the Preschool for All program, which was set to take effect in 2026.
The Preschool for All program, approved by voters, provides free preschool education to an increasing number of children in Multnomah County. Funding for the program comes from a tax on the top 9% of the county’s highest earners. Individuals earning $125,000 or more annually and joint filers earning at least $200,000 are taxed at a rate of 1.5%. An additional 1.5% tax is levied on those earning over $250,000 individually or $300,000 as a couple.
Currently, the program serves more than 2,000 preschoolers across the county and has accumulated a surplus exceeding $200 million since its inception in 2020. This surplus has led some taxpayers to demand that the county either spend the excess funds or reduce the tax burden. County officials have argued that the surplus is temporary, reflecting the program’s early stage, and that the finances will stabilize as the program expands.
After analyzing the potential impact of delaying the 2026 tax increase, the county determined that a one-year postponement would not significantly harm the program. This delay would also provide more time to evaluate the program’s needs and effects, according to Multnomah County Chair Jessica Vega Pederson.
“Based on our updated modeling and the concerns raised about the impact of our tax, I believe it’s appropriate to delay the scheduled increase and extend the deadline for the technical committee report by one year,” Pederson stated. “This additional year will give us more post-pandemic data to make informed decisions as we aim to achieve universal preschool access by 2030.”
During the meeting, Multnomah County Economist Jeff Renfro informed the commissioners that a one-year delay is feasible. However, he cautioned that completely eliminating the 0.8% tax increase could deplete the program’s funds within a decade.
“The lowest point our fund balance reaches is around $300 million, which is a substantial cushion and why we considered delaying the tax,” Renfro explained. “With the delay, the surplus would drop to just under $200 million, meaning the county can still delay the tax by a year and implement the program as planned. But if we cancel the tax increase entirely, the program would run out of money by 2032.”
Senior Policy Advisor Hayden Miller added that the county is in the process of forming a technical advisory committee to explore alternative funding options for the preschool program. The committee is expected to be staffed by Halloween.
“This advisory group will consist of technical experts,” Miller said. “They will focus on assessing the revenue and financial needs of the program, including input from economists, demographers, County Chief Financial Officer Eric Arellano, County Economist Jeff Renfro, and Preschool for All Director Leslee Barnes.”
The commissioners passed the ordinance to a second reading, with a final decision on the proposed tax delay scheduled for September 5.