An effort to widen Interstate 5 through Portland and build developable highway covers in Albina stands to lose $412 million in federal funding, a state analysis found.

The I-5 Rose Quarter Improvement Project will lose $150 million in 2027-29 and $262 million in 2029-31 after the passage of a Republican-led funding bill, according to an analysis by the Oregon Department of Administrative Services‘ Chief Financial Office.

President Donald Trump’s so-called “Big Beautiful Bill,” also known at House Bill 1, rescinds unobligated funds from the Neighborhood Access and Equity grant program, according to the state’s preliminary analysis, which was released on Monday.

The Trump administration’s move to pull previously approved funding puts the project’s immediate future in doubt, according to the state analysis.

“While an initial $60 million contract for paving and stormwater work that is part of phase 1 has advanced, constructing the remainder of phase 1 and phase 2 will be exceedingly difficult, if not impossible, without federal funding,” the Financial Office stated.

The funding rescission may cloud the project’s future, because it cannot be completed without hundreds of millions of dollars in additional funding, and state transportation funding is also stretched. A special session called for Aug. 29 is expected to produce money for operations and maintenance, but not major infrastructure projects such as the I-5 improvements.

The Rose Quarter project is expected to cost $2.1 billion, according to the Oregon Department of Transportation‘s most recent estimate.

“Any pause or delay will result in project cost escalation and removal of scope elements to bring down costs would significantly impact community support,” the analysis adds. “ODOT continues to evaluate the committed project financing, weighing options, as well as considering alternative investments since the total financing for the Rose Quarter Improvement Project is no longer secured.”

Joe Cortright, an economist and frequent ODOT critic, said the agency should pause the project until funding is secured.

“The idea that you would start work on this project, move forward with this project, when you’re at least $1 billion short makes no fiscal sense at all,” he said.

ODOT officials said they have no intention of delaying initial construction on the I-5 Rose Quarter Improvement Project. Construction will begin this summer and continue into late 2026, spokeswoman Rose Gerber stated in an email.

There are no plans for a ground-breaking ceremony, Gerber stated.

The first phase will include the extension of an auxiliary lane within the existing footprint of I-5 between the I-84 and the Morrison/OMSI exits, along with stormwater improvements and bridge maintenance. The work was previously approved by the Oregon Transportation Commission. Future phases are less clear.

“The agency is reviewing project financing and determining next steps,” Gerber stated. “ODOT is committed to working with its partners to secure additional funding to construct the project.”

Cortright said he’s concerned that ODOT intends to begin the project and then request a bailout from the Legislature. That is how he described ODOT paying for the Abernethy Bridge project at Oregon City.

“They started work on it, so they’re throwing more money at it,” Cortright said. “I think the ODOT plan is to repeat that process. Get started on it … and then go to the governor and the Legislature and ask for more.”

Whether ODOT’s plans to reconnect the Albina neighborhood with a freeway cover over I-5 will happen also remains to be seen. The cover has a been a key demand of Portland’s Black community, which is seeking to reconnect the North-Northeast Portland neighborhood that was partially demolished via 20th-century urban renewal practices.

A spokesperson for Albina Vision Trust, the group spearheading the effort, did not respond to messages requesting comment on Thursday.

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