Kotek’s Plan Would Raise Gas Tax and DMV Fees to Keep Oregon’s Transportation Network Running

Oregonian motorists will feel the pinch if state Governor Tina Kotek’s proposals to raise funds to finance the transportation network are passed at a special legislative session at the end of August.

Gas Will Cost 6 Cents More Per Gallon

Motorists will pay six cents more per gallon more for gas, $139 more for title fees, an additional $43 for vehicle registration fees, and an electric vehicle supplement fee of $30.

Kotek announced the proposed increases after revealing that she has recalled legislators to attend a special session on August 29 to readdress a funding package for the Oregon Department of Transportation (ODOT). Lawmakers failed to reach a consensus on a funding package during the last session.

As federal funding streams dry up in a belt-tightening exercise by the Trump administration to ‘Make America Great Again,’ lawmakers nationwide are having to devise innovative alternative streams of income to maintain essential services.

Kotek says her proposals will provide the funds to meet ODOT’s budgetary needs, maintain basic services, and avoid worker layoffs. In Oregon, the transportation budget is divided, with 50% to maintain state roads, 30% to maintain county roads, and 20% for the upkeep of metro roads.

Governor’s Intervention Stalls Worker Layoffs By Six Weeks

The governor’s intervention after lawmakers failed to pass the ODOT budget has thrown a lifeline to 483 people who had been laid off, extending their employment from July 31 to September 14. Kotek is hoping that lawmakers can reach an agreement in the special session to  save those jobs, and hundreds more earmarked for dismissal early next year.

Kotek is also proposing a 0.1% increase on the state’s payroll tax, doubling its present rate. Payroll tax is a levy paid by workers to fund insurance programs such as Medicare and Social Security.

Another major issue Kotek hopes legislators will consider is the state’s weight-mile tax, which applies to vehicles with a gross weight over 26,000 pounds. Kotek believes that the law needs to be modernized in the face of growing pressure from the Truckers Association for a rebalance of the rates comparable to those payable for cars.

TriMet Urges An Increase In the Payroll Tax to Maintain Its Services

Also in the firing line is TriMet, which has been urging lawmakers for months to increase the payroll tax to help maintain transit services. The agency warns that unless the payroll tax is increased significantly, the agency faces cutbacks of 15% in 2027, with a further 5% every two years following.

Like ODOT, TriMet is facing staff cutbacks of at least 140 operators unless lawmakers can agree to the governor’s proposals to introduce various increases to finance a funding package.

TriMet says it will prune its operations by eliminating eight bus lines and curtailing the frequency of its morning and evening routes. TriMet hopes to increase efficiency when the changes are introduced in March 2026.