Governor Tina Kotek is banking on a controversial mix of tax hikes and fee increases to plug a $350 million budget hole in Oregon’s transportation department — and she expects lawmakers to sign off on it during a special legislative session scheduled for August 29.
As first reported by OPB’s Dirk VanderHart, the governor laid out her plan Wednesday, which includes:
- A 6-cent-per-gallon increase to Oregon’s gas tax (from 40¢ to 46¢ starting in January),
- A $42 hike in vehicle registration fees and a $139 increase in titling fees,
- A new $30 surcharge for electric vehicles, which currently pay no gas tax,
- Doubling the payroll tax that supports public transit (from 0.1% to 0.2%),
- Mandatory participation in Oregon’s per-mile road usage program (OReGo) for EV and hybrid drivers,
- Increased audits and accountability measures for the Oregon Department of Transportation (ODOT),
- And a repeal of the state law authorizing highway tolling in the Portland area.
According to OPB, Kotek’s proposal would generate around $650 million over the two-year budget cycle — enough to halt impending layoffs at ODOT, which had warned it would need to cut nearly 500 jobs after lawmakers failed to pass a funding package earlier this year.
In a press conference, Kotek struck an optimistic tone:
“I am confident that next month legislators are going to show up, they’re going to approve the necessary funding for the state’s transportation needs.”
The governor’s office hasn’t released a formal breakdown of the proposal, but Kotek emphasized the urgency of the situation. She recently delayed the layoffs by 45 days to give lawmakers time to act.
Still, the plan is not without controversy. Republican leaders have blasted the idea, arguing the state should prioritize existing revenue before asking Oregonians to pay more.
“Just weeks after the Legislature rejected the largest tax increase in Oregon history, the Governor is calling us back to Salem to try again — this time with less notice and less transparency,” said Senate Minority Leader Daniel Bonham (R-The Dalles) in a statement Tuesday.
Despite Republican resistance, Kotek told reporters she expects both chambers will have the quorum needed to move forward, though some lawmakers may be vacationing during the late-August session.
After being criticized for staying hands-off during the regular session, the governor said she’s now fully involved.
“I’m not complaining, but the minute the session ended I canceled all my plans,” Kotek said. “We have been working on this nonstop with folks.”
Whether her proposal will sail through or hit a roadblock remains to be seen. But one thing is clear: Oregon’s transportation future — and the jobs of hundreds of state workers — hang in the balance.
