First things first: We believe in affordable, high-quality childcare. This page isn’t an argument against state-funded preschool — it’s the case against this tax and this program, built from the county’s own numbers and from independent reporting and research.

While that bias is noted, the intention is for this page to represent the argument against PFA, while also being comprehensive and honest and citing sources and follow-up reading. We believe the facts stand for themselves, but also that readers should have an informed, nuanced opinion of the situation. The strongest supporters of the tax are careful to narrow their arguments and mislead their audience. We want to do better than that, because Portlanders deserve the best our democracy has to offer. If you find any of this factually inaccurate, or think information is missing, please reach out.

What is Preschool For All?

Preschool For All (PFA) is a Multnomah County program, approved by voters in November 2020, that aims to offer free preschool to local three- and four-year-olds and reach “universal” access by 2030. It is paid for by a dedicated personal income tax on county residents and on income earned in the county.

The tax has two tiers, stacked on top of Oregon’s state income tax and the region’s other local taxes:

  • 1.5% on taxable income above $125,000 (single) or $200,000 (joint), and
  • an additional 1.5% (3% total) on income above $250,000 (single) or $400,000 (joint).

A further 0.8% rate increase is written into the measure. The county has twice delayed it — now to January 1, 2027 — which would push the tiers to 2.3% and 3.8%.

If you make a dollar over $125,000, or are married with a household income of over $200,000, you are subject to this tax. This is on top of state taxes, property taxes, and SHS local taxes. Consider whether you think you are “wealthy” and should be paying this while others do not.

Preschool for some, a tax on us all

This is the heart of the problem. The tax is collected from a wide and growing group of people, while the benefit reaches only a fraction of them.

  • You pay whether or not your child gets a seat. Because the program is still scaling toward 2030, only a fraction of eligible children currently have slots. Thousands of families pay the tax and then lose the enrollment lottery — paying the county and paying out of pocket for private preschool or daycare.
  • You pay even when your child is enrolled. Qualifying families don’t get a pass on the tax. Many working households are now footing the bill for the PFA tax and their own child’s education at the same time.
  • Commuters pay but can’t enroll. The tax applies to income earned anywhere in Multnomah County, but enrollment is limited to county residents. People who commute into Portland for work fund the program through payroll withholding and are barred from putting their own kids in it.
  • It isn’t even full-time care. PFA typically funds about six hours a day. A normal workday plus commute runs eight to ten. Working parents still have to find and pay for separate “wrap-around” care to cover the rest of the day.

The county’s own PFA Technical Advisory Group (TAG) acknowledged many of these points in their own April 2026 report, and opted not to recommend addressing this.

A tax on working families

PFA was sold as a tax on the wealthy. In practice it is sliding onto the middle class, and by design.

  • With frozen thresholds, more working families pay each year. The $125,000 and $200,000 lines are not indexed to inflation. Every year, ordinary cost-of-living raises push more people over them – this results in income bracket creep. The TAG is aware of this, but PFA’s strongest supporters refuse to allow relief, despite reports indicating this is safe and advisable
  • Dual-income families and homeowners get caught first. Two working parents, each with a solid-but-not-wealthy salary, can cross the joint threshold without ever feeling wealthy, especially when raising kids.
  • Supporters want it both ways. Many defenders insist the thresholds can’t be indexed to inflation — while also pushing to let the scheduled 0.8% hike take effect. A tax that automatically widens its own net every year, and is built to raise its own rate, is not a narrow tax on the rich. Calling it one is misleading, and raises serious questions about the motivations of supporters and the financial underpinnings of what Portlanders were sold on the 2020 ballot.

Over half a billion in unspent funds and growing, while Portland faces record shortfalls

The most striking fact about PFA is that it is drowning in money it cannot use.

  • In its first three years, the program collected roughly $213 million more than it budgeted, plus about $20 million in interest.
  • The fund balance reached $485 million at the end of FY2024 and has climbed past $600 million since.
  • County economists project the reserve could grow to nearly $2 billion over the next two decades if nothing changes — in part because the program may need to fund only about 7,600 seats to reach universality, far fewer than the revenue assumes.
  • All this happens against a backdrop where Portland struggles to meet its budget, with our public schools under a record squeeze.

Why is the pile so big? The original revenue modeling failed to account for unearned income — investment interest, dividends, and capital gains. The county chose to tax those streams anyway, producing a windfall the program was never built to spend. A slow rollout and a shortage of childcare workers did the rest.

And yet the measure still contains an automatic 0.8% tax increase. The county has had to keep manually pausing it precisely because the surplus is so large — proof that the tax is structured to extract more by default, disconnected from what the program can actually do with the money.

Siloed money during record budget cuts

PFA’s billion-dollar reserve is walled off from the rest of the county and city budget. It is not in the general fund, so it cannot be redirected — by law it sits unspent even as other essential services are starved.

At the same time, Portland-area schools are facing budget shortfalls and early closures, and transit, parks, and libraries are squeezed. The city has real, urgent funding needs. PFA hoards money it cannot spend on the very services families depend on, while consuming the tax capacity that might otherwise fund them.

This is a classic Portland problem: our eyes are too big, we see things we want and put them on ballot measures. But we are not considering the bigger picture of how to fund our city and get the best good for our residents, our families, with our money. The city needs more revenue after COVID-era closures and the commercial real estate crash, yet raising new taxes to fund our essential services is unpalatable when we already have among the highest taxes in the nation.

The problem is only getting worse with PFA, pushing Portland into a potential deathspiral revenue situation:

The tax base is leaving — and that’s not a myth

Multnomah County now carries one of the highest tax burdens in the country. A governor’s task force found Portland has the second-highest top marginal income tax rate in the United States — about 13.9% — ahead of New York City and San Francisco. Pause for a moment: consider the social services, schools, transit, libraries, etc., of those two cities. Now compare to Portland.

When you tax that hard, people respond:

  • A 2026 study, “Mult-No-More? The Migration Effects of Multnomah County’s Preschool for All Tax” — co-authored by economists at Reed College, the University of New Hampshire, and Yale’s Budget Lab — found consistently elevated out-migration from Multnomah County and Oregon after the PFA tax took effect. Notably, these same researchers spent two decades finding little link between taxes and migration; they concluded that pattern is now shifting here, making PFA exceptional in causing a push out of Multco.
  • In June 2025, Governor Tina Kotek wrote to county leadership that she was “troubled by the overall decline in the total number of taxpayers filing for the PFA tax, a drop of more than 1,700 total filers since 2021,” and asked the county to “ease the current tax burden.”
  • In August 2025, the Governor’s tax advisory group recommended halting PFA revenue collection pending a full review and restructuring the program around the state-funded Preschool Promise model, warning that “if the erosion of Portland’s taxable capacity continues, it will constrain the resources needed to serve those who rely most on public systems.”

The county and some local officials have dismissed tax-driven migration as a “myth.” Independent research, the state’s own governor, and her advisory group say otherwise. Waving away the warning signs hasn’t made the problem go away — it has made it harder to fix.

At the end of the day, we can let the facts stand here. The state and county are in the best positions to lay out the facts and be transparent about the impact of PFA on our tax base. The fact the county holds a party line, and attacks constituents expressing skepticism, should raise some serious concerns.

Our position

We’re calling for repeal of the Preschool For All tax, a full public accounting of the money already collected, and a redesigned childcare solution that doesn’t sit on an unspendable surplus while pushing working families and the broader tax base out of Portland. Affordable childcare and a healthy city are not in conflict — but PFA, as built, undermines both.

See how you can help →

Anything missing?

If you have suggestions, missing articles, other discussions you recommend including here, please reach out!

At the end of the day, this page should reflect the best, most comprehensive look at the situation. The facts should stand for themselves, and the reader should make an honest judgement of the situation.

Sources