After the Preschool for All Technical Advisory Group (TAG) released its recommendations, we spoke with Mary King, Professor of Economics Emerita and a TAG member. Mary served on the 2019 Preschool for All Taskforce in the Administration and Finance working group, co-wrote the ballot measure as a member of Universal Preschool NOW!, and is co-chairing the Friends of Preschool For All coalition. The TAG was mandated in the ballot measure to “report to the Board before January 1, 2026 with a recommendation on the rate required to ensure the program is fully funded” and was delayed a full year by request from Governor Kotek.
Putting the need for a higher tax rate in the hands of elected officials seems risky. They’re often hesitant to raise taxes. Why did the ballot measure call for one set of tax rates for the early years, followed by the small bump in the tax 5 years later?
It was a compromise driven by people who thought that opposition would be less if initial tax rates were lower. Ballot measure drafters knew that the program would spend much less in the early years than would be needed in later years, and some were afraid to create the impression that the program was “sitting on money.”
Incomes at the top from investments were unusually high in PFA’s early years, so the program was well-funded from the start. That was lucky, because investment incomes swing widely and unpredictably. We needed strong early years to build a reserve capable of weathering big drops in revenue. The big reserve we see today is being saved to fund part of the full roll-out, but won’t be enough without the tax bump.
So the measure called for an increase in the tax rate to match growing expenses as the program expands, but the increase still doesn’t happen unless the board votes to approve it?
The ballot measure called for an increase in the tax rate of just under 1%, starting in 2026. It also called for a technical advisory group to advise the County Commissioners if the size of the tax bump should be different. The voter-adopted plan said: “By 2026, state or federal funding for early childhood education could further offset additional local investment and reduce or even eliminate the need for the rate increase.”
Some people – not me – thought the federal government might step up, given Elizabeth Warren’s push for childcare as a presidential candidate. She galvanized both Bernie Sanders and then Joe Biden to propose a big federal investment in early childhood education and care.
Hindsight is 20/20, and we now know that cuts to childcare and early learning have been made both at the state and federal levels. What’s happened in politics and the economy more broadly since the Preschool for All ballot measure passed in 2020?
Trump’s tax cuts at the top just amplified the way the market and federal policies have funneled all the economic gains of recent decades to the affluent, worsening inequality but creating a reliable funding source for preschool.
Oregon’s early childhood programs have also been hit by big cuts in federal funds for Headstart and the block grants that are important for Oregon’s Preschool Promise and Employment Related Day Care (ERDC) programs. Preschool for All counted on federally and state supported spots to help reach full universality. Without them, we’ll need even more PFA spots than planned.
Trump’s economic and military policies are disastrous. Extreme and erratic tariffs especially hit Oregon’s larger than average export and manufacturing sectors, worsened by huge federal layoffs and research cuts. We’re more exposed to cuts in Medicaid and food aid (SNAP), because Oregon’s done an unusually good job of expanding both health care and participation by eligible people in SNAP. The war on Iran is hastening a likely recession. Recessions are hardest on people with lower incomes, but the one that may be coming could also hit investment income, and the preschool tax take, given the possible AI bubble and a big rise in unregulated non-bank lending.
In the face of all this, the Technical Advisory Group, or TAG, was finally convened a year behind schedule in the spring of 2025. What were your first impressions of the TAG when it assembled?
I was surprised by who was and wasn’t included. I’d expected it to be half early childhood policy experts, including providers and teachers, but only two of the seven people appointed knew a lot about early childhood education and care in Oregon. Also, I’d been told that TAG members would have the ability to invite experts to address the TAG, but that didn’t happen.
Looking at the composition of the group we see one lawyer who is on the board of the Portland Metro Chamber, one lobbyist from OBI, one economist from a national group that argued against free school lunches in Colorado, and someone who oversaw a PPS redistricting project. Meghan Moyer called attention to this in the fall,and called the credibility of the TAG into question. Ultimately there was no appetite on the Board to make changes. What information could this disparate group offer Preschool For All?
Some voting members seemed to bring no relevant expertise or evidence to a “technical advisory” group. Both Oregon Business & Industry and the Portland Metro Chamber have taken strong positions against the preschool tax and even our ability to raise taxes at the local level by ballot measure. And the person repping Oregon Business & Industry was until quite recently the boss of the team doing the economic analysis contracted by the County.
A second group, not mentioned in the ballot measure, was formed at the same time as the TAG. This was the Program Advisory Group, or PAG. How did the two groups relate to one another?
The PAG was made up of the early childhood experts that I’d expected to be half of the TAG members, including Preschool for All providers. By including PFA providers, PAG members were the only voice in the process for small, local businesses owners, many of whom don’t feel represented by OBI or the Metro Chamber. Small business owners recognize the importance of childcare for their employees, and often themselves, and how difficult it is to pay people enough to afford both rent and good, reliable preschool and childcare.
What I’d expected, and asked for in TAG meetings, was for the PAG to tell the TAG about what resources were needed to take the program to full universality without cutting any corners. Then the TAG could recommend a tax bump that would raise enough money to fund the program.
But the PAG’s charge from Board Chair Jessica Vega Pederson was to figure out how the program could adjust to whatever the TAG might recommend about the tax, clearly expecting tax cuts in response to the hostility expressed by big business lobbyists and the Governor to the PFA tax and program.
Did the TAG respond to the concerns surfacing in PAG meetings?
Only in a very limited way. Of 16 TAG meetings, only three were joint with the PAG, all near the end. And, like other TAG meetings, consultants’ presentations took up most of the time and drove the conversation. Late in the process PAG members were invited to join TAG meetings, but could not vote.
At some point, a new demographic forecast came out from PSU. How did that data inform your thinking, and that of the TAG?
The demographic forecast predicted that the ongoing national decline in birthrates over the past 15 years would continue in Multnomah County, noting along the way the huge impact the economy has on fertility. Researchers report that Americans feel they can’t afford to have as many kids as they’d like. Young families are struggling with the high cost of housing and childcare.
But the TAG made no effort to consider how free, high quality, universal preschool might affect the decisions young families are making about where to live and how many kids to have. Leaders in other places clearly think it’s important to attract young families. San Francisco is providing free childcare for families with incomes under $230,000 as part of a larger Family Opportunity Agenda. New York City and the state of New Mexico are also on board.
Cristobal Young, a prominent scholar who’s shown that wealthy households rarely move in response to higher taxes, points out that the most mobile people are young professionals. Young urges regions to focus on attracting those young professionals, some of whom will be the high-income households of the future.
That said, it’s not the birth rate driving predictions of those who say that far fewer children are likely to be enrolled in Preschool for All than were planned for. The big drops are from questionable assumptions that (1) many fewer families will participate than do in universal programs elsewhere and that (2) as many young families will leave Multnomah County after their children are born as have in the past 20 years, unaffected by the availability of free, high quality, preschool with lots of different choices for families, in terms of language, cultural context, schedule and type of setting.
Did the TAG and the PAG come to similar conclusions?
No. The PAG seemed united in their understanding that per child costs are underestimated and that more funding is needed now to better support children with high needs. Also, PAG shared evidence that the proportion of families likely to enroll and preschool-related inflation were being lowballed. And while a teacher substitute pool has been created, the program has not yet developed other critical shared services for PFA’s small business providers, such as meal provision, insurance, and payroll.
The TAG was pushed to consider untenable cuts to the program, to offer it only during the school year, for the length of the school day, despite the ballot measure language clearly calling for a year-round, full-time option. Another suggestion was to hire a separate group of teachers for some of the hours, effectively making all the teachers part-time and completely disrupting classroom dynamics and relationships!
What do you think the TAG missed?
The TAG looked at scenarios that ranged from a “low cost” one that failed to deliver the program promised to voters, to a “high cost” scenario that still lowballed or omitted important costs. Only the untenable “low cost” model scraped through an early recession. Costs and the likely participation rate of families were underestimated in all the scenarios considered. No scenario pulled out a reserve big enough to weather the known potential for a drop in annual revenue by nearly half, never mind if we have just two years in a row like that. And the building odds of a recession in the next few years was ignored until the end of the process, and never combined with more realistic cost estimates, for an accurate, plausible worst case scenario.
What could we do to prepare Preschool for All for the eventuality of a recession?
The odds of a recession before the end of the year are now nearly 50%, according to Mark
Zandi, chief economist at Moody’s Analytics. None of the future scenarios modeled pass the test of an early recession while delivering the option of a year-round/full-time schedule, as called for in ballot measure language and preferred by the majority of participating parents.
The best way to prepare is to establish a rainy day fund. This would have 1 to 2 years of operating expenses in reserve so no cuts would be needed to weather an economic downturn, an unexpected surge in enrollment, or costs that come in higher than currently projected.
For the average person who cares about families and wants tax money to be spent efficiently, but doesn’t need all the details, what are the big takeaways here?
Sign up for the Friends of Preschool for All email list and then sign the Friends of Preschool for All petition. The petition demands that the Multnomah County Commissioners fully fund our voter-mandated program without cutting any corners.
If you have or have had a child enrolled in Preschool for All, please share your experience here. And if you‘re a local business owner, please fill out this form to let us know which of some possible ways you could visibly demonstrate your support. If you’re a member of an organization that’s not already part of the Friends of Preschool for All coalition, and could help us speak with your leadership about joining, please let us know at friendsofpfa@gmail.com. We’ll be letting everyone know about volunteer opportunities, including moments to pack the County Board meetings to let the Commissioners know that we want the universal preschool program that we voted for by two to one!