Preschool for All: county projects 3,800 seats for FY26, warns of long-term funding gap without policy changes

Multnomah County staff told the Board of Commissioners that Preschool for All will serve 3,800 children in fiscal year 2026 and that the county is updating financial models to test long-term sustainability. The presentation reviewed facility investments, workforce wage targets and the role of a technical advisory group to study the program's tax mechanism.

"Preschool for All will run out of funding in 02/1934," Director Leslie Barnes said as she presented updated modeling and program assumptions. County budget staff and program leaders emphasized that the modeling is a planning tool and that policy adjustments are available to change the program's fiscal trajectory.

Why this matters: Preschool for All is funded in part by a county tax enacted to expand preschool access; staff said the program already shows strong enrollment gains but also faces volatility in revenues tied to high-income tax filers and rising program costs tied to expanded inclusion supports and wage targets.

Key financial and program details from the briefing: - Enrollment and seats: staff said the program will provide roughly 3,800 seats in FY26, and that by fuller build-out the model expects about 11,200 seats (the presentation said universal preschool is expected in the early 2030s subject to state and federal investments). - Facilities fund: Build Up Oregon-administered Preschool for All Facilities Fund awarded about $9,500,000 in FY24 to projects that will create 332 new Preschool for All seats and improve environments for another 270 children; those investments leveraged an estimated $7,400,000 in outside funding. - Workforce and wages: the program has a compensation matrix; Barnes and staff noted minimum assistant wages and goal lead teacher wages. Program staff said that Preschool for All requires minimum assistant wages above the county average and aims for lead salaries comparable to kindergarten teacher pay. "The minimum wage for an assistant in Preschool for All is $21.68 per hour and the goal salary for a lead teacher with a BA or step 10 is $39.23 per hour," staff reported. - Inclusion and costs: staff said modeling increased the assumed cost of serving children with developmental delays and disabilities; inclusion supports are now modeled at about 8% of per-seat costs going forward. Additional modeling changes included projected higher numbers of seats in the late 2020s and increased investments in coaching, nursing, infant/toddler stabilization, and workforce development. - Revenue and tax mechanics: Budget Office economist Jeff Renfro explained tax mechanics and volatility. "In the tax code, the tax is scheduled to increase by 0.8% on 01/01/2027," Renfro said, and he documented how capital gains fluctuations among higher-income filers drive revenue volatility. The presentation showed the county's dedicated-savings strategy (set-aside surplus early in implementation to cover later deficits) and warned that, under current assumptions, the fund balance dips below zero in 2034 unless program or revenue assumptions change.

The county described the Technical Advisory Group (TAG) required by the tax code and said it will begin stakeholder outreach and hire an economic consultant to model policy scenarios. Staff said the TAG's recommendations and the economic consultant's analyses are expected to be delivered to the board in early 2026 and that any tax-code changes would need board action by August 2026 for implementation in tax year 2027.

Ending: Commissioners asked for additional breakdowns (including district-level mappings, more disaggregated tax-return tiers and clearer cost-driver trends). Staff offered to provide original baseline budgets, a more detailed cost-trending analysis and the TAG membership and outreach plan as the work continues.