When Riley McPhee’s twins were born four years ago, he and his wife immediately began looking into their childcare and preschool options. After looking into multiple programs and crunching numbers, it became clear that the kids’ monthly daycare expenses would end up consuming the entirety of his income. McPhee and his wife decided to have one parent stay at home with the kids for the first three years of their lives, switching off after a year and a half. It saved them the cost of daycare, but meant their four-person household had to rely on a single income to get by. 

Then, when the twins turned three, it was time for preschool. But instead of paying thousands of dollars a month for them to attend private preschool, as would likely be required to ensure their access to a quality early education, their tuition was fully covered by Multnomah County’s Preschool for All program. 

“I can say with zero reservation that Preschool for All transformed our lives,” McPhee told the Mercury. “If it didn’t exist, almost all of my income would be going to [childcare.] Instead, I am able to use my wages to enrich the lives of my children and our family.” 

McPhee’s family is one of about 1,900 in Multnomah County currently benefiting from Preschool for All, which was approved by 64 percent of county voters in 2020. The program is funded by a marginal income tax paid by the county’s highest earners, and has been accepting participants since the 2022-2023 school year. The county ultimately aims to offer free, high-quality preschool to all its families if they so choose, hoping to do so by 2030. 

That is, if pushback against the program—first from Portland area business leaders and now from Governor Tina Kotek and members of the Oregon State Legislature—doesn’t end it altogether. 

Late Monday night, members of the Oregon Senate’s Committee on Finance and Revenue added an amendment to the placeholder Senate Bill 106. As written, the amendment would obligate Multnomah County to stop collecting Preschool for All taxes now, and phase out the program entirely by 2027. 

The move came following a recent exchange between Kotek and Multnomah County Chair Jessica Vega Pederson, revealed last week by Willamette Week. The correspondence seems to have started when Kotek sent a letter to Vega Pederson on June 10, encouraging the county chair to make significant changes to Preschool for All. In response, Vega Pederson said while she is open to making some changes, she is concerned about delivering on the program’s promises. 

Advocates for Preschool for All were concerned by news of Kotek’s letter. But they were even more outraged by Senate Bill 106, which lawmakers appeared poised to push through at the very end of this year’s legislative session, without taking any public comment on the topic. Many expressed their fears on social media, and more than 35,000 Preschool for All supporters wrote letters urging state lawmakers to back off the program. Whether due to the volume of opposition or because the end of the 2025 legislative session is mere days away, Senate Bill 106 doesn’t appear to be moving forward. 

Even if the Oregon Legislature isn’t on track to kill Preschool for All this session, county leaders and program advocates are staying alert to potential new threats. 

“The threat hasn’t gone away. We have to have a conversation in Oregon about who the government is there to serve,” Multnomah County Commissioner Meghan Moyer said at a June 25 press conference organized by Preschool for All advocates. “I will stand strong, but I do not stand alone in saying Multnomah County and the state of Oregon have to be there for the people. Programs [like Preschool for All] are what let people live and thrive in Multnomah County.” 

Preschool for All pushback

When Preschool for All passed with nearly two-thirds of the vote in 2020, it set up a marginal income tax meant to impact only Multnomah County’s highest earners. For single filers, a 1.5 percent tax kicks in on income over $125,000, while the threshold for joint filers begins at $200,000. Single filers contribute 3 percent of their income above $250,000. Those filing jointly pay 3 percent for their earnings that exceed $400,000. 

Despite strong support for the program, Preschool for All got its share of backlash from the start. Notably, Portland Metro Chamber Executive Vice President Jon Isaacs attempted to kill the program with a lawsuit before it even qualified to be on the 2020 ballot, challenging its constitutionality. Though their early attempts to completely stifle the program didn’t work, Chamber leaders have remained among the loudest critics of Preschool for All in the years since. They allege the tax is contributing to an exodus of Portland’s high earners, making the city less competitive. 

Critics have also taken issue with Preschool for All’s rollout, which they say has been too slow—especially considering the program has a pot of unspent money in the bank. Some private preschool providers have been hesitant to participate in the program, and others have wanted to but been denied. County officials say they always planned a slow, careful rollout with money in reserves, to accommodate for fluctuations in personal income tax earnings. 

Multnomah County leaders may have been able to dismiss Preschool for All backlash when it was largely confined to the peanut gallery. But now, in a turn county leaders say was unexpected, Governor Kotek is leading the charge against it. 

In Kotek’s June 10 letter, the governor asked Vega Pederson for her “consideration of approaches that ease the current tax burden even if doing so may slow the timeline toward achieving universal preschool in Multnomah County by 2030.” 

The governor’s suggested changes included clarifying the program’s financial needs, pausing tax collection for three years to focus on “strengthening the existing program at the current number of seats,” and reducing the tax rate. 

Kotek also expressed concern that “the scope of the program has grown beyond what was proposed in the ballot measure,” potentially impacting its sustainability.  

Vega Pederson wrote back on June 18. In her letter, the county chair expressed openness to potential changes to Preschool for All’s tax rate and mechanism, potentially including adjusting the income threshold for inflation, and said she shares the governor’s concerns about the county’s “financial health and well-being.” 

“However, it is crucial that future decisions are guided by economic research and a community-centered and equity-driven process,” Vega Pederson wrote. “Hasty decisions or piecemeal changes to the tax mechanism or rollout of this program will not serve Multnomah County or the future we’re delivering.” 

“It’s like nothing that I’ve ever seen before out of the Legislature.”

Following news of the exchange between Kotek and Vega Pederson, members of the Legislature’s Senate Committee on Finance and Revenue took up the Preschool for All mantle. First, they held a brief information session about the program last Friday, indicating their desire to make changes. When the amendment dropped on Monday night, though, its contents were far more dire than county leaders had predicted. 

“I think there is some end-of-session maneuvering that is happening at the last minute to try to get out of the building whatever folks are trying to do. But I think using the children, family, workers, and people of Multnomah County as a means to that end is completely undemocratic and unfair,” Vega Pederson said at a Tuesday morning press conference. “Really, it’s like nothing that I’ve ever seen before out of the Legislature.”

A few commissioners headed down to Salem in time for an informational meeting about Senate Bill 106. Senators Kathleen Taylor, who represents the western part of Milwaukie and inner southeast Portland, and Mark Meek, who represents northwestern Clackamas County, were the most outspoken committee members during the discussion. But it was immediately clear they struggled to defend the amendment from Multnomah County leaders, seeming to back away from the text they ostensibly supported just the day before. (Neither Meek nor Taylor responded to the Mercury's repeated requests for comment and clarification.)

“My understanding from the governor is that she is not trying to get rid of preschool slots…I don’t think anybody is interested in making it so there aren’t slots available,” Taylor said. “The question is, can we maintain the slots in a way that's more economically responsible?”

As written, the amendment to Senate Bill 106 would sunset Preschool for All in 2027, explicitly getting rid of any available preschool slots for interested families. 

Meek stressed his concern that Preschool for All is duplicating services already available at the state level, such as the Department of Early Learning and Care’s Preschool Promise. He also indicated a desire to see the Multnomah County program adopt means-testing, limiting services only to those below certain income thresholds. 

Multnomah County leaders emphasized the difference between the statewide Preschool Promise program, which provides free preschool to Oregon families who live below 200 percent of the state’s federal poverty level, roughly $64,300 for a four-person household. In addition to the program’s income limitations, it only provides partial-day preschool, making it inconvenient for parents who have to work full-time. The program is also facing a funding shortfall, as the Legislature recently approved a departmental budget that included major cuts to early childhood education programs, including a $20 million cut to Preschool Promise. 

Advocates have also pointed out that Preschool for All has requirements that ensure teachers and assistants are paid wages that are significantly higher than those required by the state programs. 

“Multnomah County’s Preschool For All gets right what state preschool programs get wrong,” County Commissioner Meghan Moyer said. “We're being criticized for not being means tested…we prioritize low-income families right now because we are not at full enrollment, but be clear that our goal is universal preschool.” 

Moyer said the cost of preschool can be “crushing” for many families, not just those who live below the poverty line. 

Means testing is often criticized for being inefficient and inequitable, leading to worse outcomes. Consider the difference in perception of universal programs like the K-12 public school system and Social Security versus means-tested ones, like SNAP benefits and subsidized housing. 

“Programs restricted to families with lower incomes never enjoy the political support and sustainability as do universal programs,” Mary King, an economist and longtime supporter of universal preschool, said.

As for Preschool for All’s supposed problems with slow rollout and underspending, Moyer says they’ve been significantly overhyped. The program did adjust its yearly enrollment goals in 2022, responding to the continued impacts of Covid on the childcare landscape, but the county still plans on offering universal preschool to all families by 2030. And the surplus of money the program has will eventually dwindle as enrollment increases. 

“Yes, we’re at a surplus, more than we expected. It’s actually a huge benefit to us,” Moyer said at the June 25 press conference. “Absolutely, we are looking at the capacity to grow…but if we don’t have healthy savings going into that period, we’d have to dip into the general fund, which would hurt other services.” 

Even if some of the pushback the program has received is valid, program advocates say the solution isn’t to completely do away with it before giving it a real chance to succeed. 

“[The Board of Commissioners] has said repeatedly, ‘Let's talk.’ Do I want every child in the state of Oregon to have access to high quality preschool? Yes, I do,” Moyer said. 

But, she said she hasn’t seen the governor and state legislature put in the work to make that happen. 

“I'm unaware that there were actual negotiations…I did not know about any conversation at the state level regarding Preschool for All until a week and a half ago when I read the governor's letter,” Moyer said, noting if state leaders were serious about wanting to change or eliminate the program, they should have included Multnomah County commissioners. “I had no conversation with anyone from the governor’s office or the legislature up until, frankly, yesterday.” 

The tax debate 

One of the first points Kotek made in her June 10 letter to Vega Pederson pertained to her concerns that high-income earners were leaving Multnomah County due to Preschool for All and other taxes. 

“I am troubled by the overall decline in the total number of taxpayers filing for the PFA tax,” Kotek wrote. “Data presented to the Portland Central City Task Force Tax Advisory Committee…suggests the PFA tax is creating an environment that discourages higher income earners, and any businesses that may be associated with those earners, from staying or locating in Portland.” 

Kotek’s fears are based on numbers that are far from universally accepted. In some cases, the data she presented was flat-out wrong. 

While Kotek referenced “a drop of more than 1,700 total filers since 2021,” recent county data show the number of filers paying the Preschool for All tax grew by nearly 5,500 between 2021 and 2023.

It’s also unclear whether the data is skewed by people filing late. Multnomah County currently requires filers to make estimated quarterly payments, or face late penalties. Some filers say the payment process is cumbersome and often difficult to comply with. 

Statistics do show a modest decrease in the county’s highest earners ($500,000 a year or more). Between 2021 and 2023, there was a roughly 12 percent decrease in filers earning half a million dollars or more, at least according to who paid the Preschool for All tax in those years. Preschool for All supporters say it’s impossible to say if high earners are leaving because of taxes—especially because of this particular tax. High-income households often rely on volatile income sources, such as investments and capital gains. And there are other reasons a household might move out of the county. 

“Not every move by a high income household is about taxes…Research shows that taxes are not big factors in household location decisions,” King, the economist, said at the June 25 press conference. “If we want to improve Multnomah County's economy, we need to ensure Preschool for All meets its promise to the voters who supported it by fully funding its rollout to universality by fall 2030.” 

Moyer was adamant about this latter point, too. The future of the county’s economy, she emphasized, is not “70-year-old CEOs” (like Jordan Schnitzer, who has spoken out against the Preschool for All tax). 

“We value the relationship [people like Schnitzer] have had with our community for a long time, but we can’t just think about them, because they’re not the future of Multnomah County,” Moyer said. “[Young people] with families—those are the next CEOs, those are the next entrepreneurs. In order to bring Portland to its full potential, we have to have people who want to move here, who want to start businesses here, who can find workers here. That is exactly what Preschool for All does.” 

McPhee, the parent of twins who benefit from Preschool for All, told the Mercury the program “quite literally lifted my family out of poverty.” He sees the benefits of high-quality preschool for his kids, who now have a leg up that will help them in the future. 

“I can say with absolute certainty that my children already have opportunities in Portland that I did not,” McPhee said. “To those in Multnomah County who fund Preschool for All: thank you for contributing to this critical program that is uplifting thousands of children in our state, transforming their lives forever. This is the kind of program that taxes are meant for…Your money is being well-spent and Portlanders won't forget your contribution.” 

He has a different message for Kotek and the state legislators involved in Senate Bill 106. 

“I proudly voted for Kotek because I believed [she was] going to champion the causes of all Oregonians,” McPhee told the Mercury. “Nobody wants to see our economy die, but is this the thing that’s going to fix it? As a voter, my trust in Kotek’s ability to get things done in an equitable and fair way has really been shaken by this experience.”

As for Kotek, she appears to be standing behind her convictions—although it’s unclear how far she’ll go. In a June 26 statement, Kotek said she understands that the Preschool for All program is “well intended and works for many families.”

“It represents hope, possibility, and opportunity, for families and for children. I get that — and will fight for the goal and the smart governance it takes to achieve that goal,” Kotek wrote. “But for many families and the community at large, the program is not working…I stand firm in my position that the County must walk and chew gum at the same time – continue to serve the children it is serving, amend the tax, and fix the program before the next tax year to reduce the burden on Multnomah County residents.” 

Kevin Foster contributed reporting to this story.