Nearly 2,200 Oregonians submitted testimony to Legislature in advance of public hearing on new, multi-billion transportation funding proposal

By Mia Maldonado, Oregon Capital Chronicle

Julie Murray is one of nearly 500 people who work for the Oregon Department of Transportation who will be laid off if the state Legislature does not provide funding to fill the agency’s $350 million budget gap.

The drone pilot and video producer has filmed wildfires, landslides and construction projects to keep Oregonians informed during emergencies, and about major highway and transportation infrastructure work. The department trusts her to be in the most extreme conditions while filming, and it’s invested in dozens of drone, artificial intelligence and safety trainings for her, she told lawmakers Aug. 25 at the Capitol in Salem. 

“The agency developed me, molded me into a perfect fit, and the layoff will throw all that away,” she said. “My coworkers on the layoff list are also all trained up. ODOT is set to lose them to the private sector and will spend years retraining and rebuilding. We are investments worth keeping.” 

Murray — along with more than 60 others speakers — shared testimony with the Joint Interim Committee on Transportation Funding during a three-hour public hearing on Gov. Tina Kotek’s transportation funding proposal that’s meant to prevent department layoffs, preserve how the state splits its highway funds with counties and cities and modernize transportation funding. 

Lawmakers were due to meet on Friday in Salem to discuss and take a vote on the proposal. Many special sessions last one day, but some take several days or up to several weeks to reach a conclusion.

The package would increase vehicle registration fees and gas and payroll taxes — raising nearly $800 million in the 2025-27 budget cycle alone — but it’s a significantly scaled-down version of what lawmakers originally proposed in June during the 2025 legislative session. Democratic lawmakers initially floated a funding package that would have raised $14.6 billion over the next 10 years, but then scaled their proposal back to a version that would have raised $11.7 billion after receiving backlash from Republicans and some Democrats. 

The proposal lawmakers are now considering ahead of a special session would raise $5.8 billion over the next 10 years, according to the Legislative Revenue Office. Most of the revenue would flow to the State Highway Fund, and from there, 50% would go to the state transportation department, 30% would go to counties and 20% to cities. The millions raised from the increase in the payroll tax would go toward local public transit districts. 

What fees and taxes would change under the proposed transportation package? 

• A gas tax increase from $0.40 to $0.46, effective Jan. 1, 2026, is expected to raise $90 million a year.
• An increase in annual registration fees from $43 to $85 for passenger vehicles; $63 to $105 for utility vehicles, light trailers, low-speed vehicles and medium-speed electric vehicles; and $44 to $86 for mopeds and motorcycles. 
• Increasing title fees for passenger vehicles from $77 to $216.
• Doubling the payroll tax used to support public transit from 0.1% to 0.2%.
• An increase to registration surcharges for electric and highly fuel-efficient vehicles, from $35 to $65 annually for cars with a 40+ miles-per-gallon rating, and from $115 to $145 annually for electric vehicles. 
• Phasing in a mandatory road usage charge program for electric vehicles by 2031. Electric vehicle drivers have been able to opt into the OReGO program and pay 2 cents per mile in exchange for lower registration fees, and the proposed change would mandate electric vehicle drivers participate in that program or pay a flat $340 annual fee. 

Committee receives mixed testimony 

The transportation committee Monday spent the first 45 minutes listening to legislative staff present on the proposal. 

“Without additional resources at current funding levels, drivers and transit providers will experience impacts of fewer snow plows, more potholes, more snow and ice on major roads, longer traffic closures because maintenance teams need to travel farther away, more trash and graffiti, slower responses to crashes and other incidents, closed rest areas and reductions in transit service,” Kotek’s transportation and infrastructure advisor, Kelly Brooks, told the committee. 

Most of those who testified in person, including transportation employees, city and county officials and union leaders, urged lawmakers to support the legislation. The bill received support from local officials from Umatilla, Wallowa, Hood River and Columbia counties and from Beaverton, Tigard, Albany and Portland.

Jana Jarvis, president of the trade group Oregon Trucking Association, also spoke in favor of the bill for its provision simplifying Oregon’s complex diesel tax rates, which would reduce the weight-mile tax rates heavy trucks pay from 85 different rates to just 10 rates. 

A handful of others criticized lawmakers and the transportation department for money mismanagement and raising taxes. This includes Jake Seavert, a Union County Commissioner, who said the county he represents largely opposes tax and fee increases.“The additional fee increases with vehicle registration further exacerbates the financial stress to every household, especially those households with more than two vehicles, to every business, small and large that utilizes vehicles for transportation of goods and services and employees,” he said. 

By the time the meeting had ended, nearly 2,200 Oregonians had submitted written testimony to the committee, with most of those writing in opposition to the legislation.

Some expressed discomfort with raising transportation costs but still supported the proposal.

“I‘m not looking forward to paying higher taxes any more than anyone else, but to me, the greater danger right now is the safety of people on our highways — especially highways going through the Cascades,” Detroit mayor Jim Trett, who spoke in favor of the bill, told the committee. 

Mia Maldonado covers Oregon and state legislature with a focus on social services for Oregon Capital Chronicle. She started her career in journalism with Oregon Capital Chronicle’s sister outlet in Idaho, the Idaho Capital Sun.