Vega Pederson Says She Will Seek to Delay Preschool for All Tax Increase by One Year

In a meeting of the Multnomah County Board of Commissioners this morning, County Chair Jessica Vega Pederson said she would like to delay an embedded increase of the Preschool for All tax until 2027.

The tax rate increase, from 1.5% to 2.3%, was baked into the 2020 ballot measure that voters approved placing a tax on high-income earners to fund free universal preschool across the county. The new rate is set to take effect on Jan. 1, 2026.

But Vega Pederson, who championed the Preschool for All program and helped it across the finish line in 2020, is now telling board colleagues she’d like to postpone the 53% increase by one year to align with Gov. Tina Kotek’s three-year tax moratorium. The chair made the pitch after she received updated revenue modeling from the county’s economist earlier this year that shows a one-year delay of the increase wouldn’t hamper the county’s ability to reach its goal of creating 11,000 tuition-free preschool slots by 2030.

“The updated revenue modeling that we’ve seen today makes one thing clear: This program has the funding it needs to allow us to delay the 0.8% increase for at least one year without any negative impact on our ability to meet our commitment to voters,” Vega Pederson told commissioners on Tuesday. “I also want to remind this board that the [we] have full authority to update the ordinance as needed to ensure we have a fair and effective revenue structure and the resources to fulfill our obligation to voters to create a universal preschool program by 2030.”

Preschool for All in its first two years created and funded a total 1,200 free preschool slots. But as WW has previously reported, Preschool for All has struggled to build out more preschool infrastructure and a teacher workforce, two critical pieces to ensuring universal preschool access within a decade.

Budget documents revealed that the county had spent only half of what it had budgeted for the program in fiscal year 2022-23, despite the tax bringing in higher-than-expected revenues in its first two years. A group of downtown stakeholders asked Vega Pederson last summer to consider canceling the rate increase. The chair said no; the extra revenue would go into program reserves, she said.

The current preschool tax rate is a 1.5% on income. An increase to 2.3% would hike the tax by 53%.

The updated financial modeling, though, has appeared to change Vega Pederson’s mind. She said on Tuesday that the board will meet in the coming weeks to discuss the one-year delay.

The county economist’s modeling also shows, however, that if the county opts never to increase the tax, the county couldn’t fund the program fully and it wouldn’t recover for at least 15 years.