Oregon Democrats are closing in on a major transportation funding bill, proposing hikes to the state’s gas tax, among a suite of new taxes and fees, according to details released across several recent reports. Senate President Rob Wagner emphasized the bill's inclusive development, stating, "This bill strikes a balance — everyone who has participated in this process has their work and perspective included," as obtained by OPB. The bill, designated House Bill 2025, could secure as much as $1.9 billion for the State Highway Fund. In what will surely be a sprint to the finish, the legislature is expected to introduce the formal bill next week, signaling the start of negotiations to obtain the necessary three-fifths majority before the session adjourns.
As reported by KATU, the gas tax under this new plan would rise by 15 cents per gallon by 2028, stepping up the timeline from earlier proposals, while also introducing new road usage charges for electric and hybrid vehicles. Aiming to carry the weight of fading gas tax revenues, electric vehicles could face a $0.25 per mile fee should the 10-cent gas tax hike be implemented in 2026, owing to the new bill's linkage of the road usage charge to 5% of the gas tax.
Transportation-related taxes and fees would see an array of increases under the newly detailed bill, including a 0.2% hike in the payroll tax, as indicated by OPB. This is higher than the initial framework but below the 0.5% that progressive Democrats are seeking by 2032. Title and registration fees are also set to rise, with title fees increasing by $70 and registration fees by $50, said to apply to gas-powered, electric, and hybrid vehicles alike.
Additionally, new and used vehicle transfer fees would introduce a 2% fee on new vehicles and a 1% fee on used cars when ownership changes hands, according to details from KATU. The vehicle privilege tax and vehicle use tax are set for an increase, with the vehicle privilege tax doubling to fund rail system improvements and the vehicle use tax raising to 0.1% to support the Wildfire Crossing Fund, an initiative geared toward erecting wildlife crossings over roadways.
Finally, based on a summary obtained by The Oregonian/OregonLive, the plan also does away with proposed taxes on new tire sales and bicycles that were previously considered, indicating an evolving negotiation as legislators work toward a palatable solution. Rep. Susan McLain emphasized the spirit of collaboration, telling The Oregonian/OregonLive, "Collaboration has guided every step of our work on" the package. After weeks of private negotiations between a small group of Democrats and Republicans, the forthcoming bill now looks set to enter what could be a divisive debate on the floor of the Oregon Legislature.
