Oregon lawmakers passed a key transportation funding bill this week, averting layoffs at the Oregon Department of Transportation and securing money for road maintenance before winter weather begins.

“Oregonians believe … that having safe, accessible roads is a core function of government,” Gov. Tina Kotek said at a press conference on Monday. “Our highways have to be open. People need to be able to get where they need to go.”

The legislation halts the threatened layoffs of hundreds of ODOT employees that were due to occur if the bill hadn’t passed. ODOT also canceled the closures of 12 maintenance stations around the state.

Overall, the package is expected to boost revenue by $791 million in 2025-27, and $889.9 million in 2027-29, according to a Legislative Revenue Office analysis.

“This funding is a significant investment, and we do not treat it lightly,” ODOT spokesman Kevin Glenn stated in an email on Wednesday. “ODOT will increase efficiency and, with this funding, continue to deliver for Oregonians.”

Republicans criticized the bill, which passed the Senate by an 18-11 margin, as a major tax increase on Oregon drivers. The legislation hikes the costs of several taxes and fees.

“Democrats chose the easy path: tax more, spend more and ignore the consequences,” Rep. Virgle Osborne, R-Roseburg, stated.

Passenger vehicle registration fees will nearly double from $43 annually to $85. Title fees will jump from $77 to $216.

Payroll taxes will double to 0.02 percent, effective Jan. 1. That’s expected to raise $196.6 million during the next biennium.

The bill also:

• directs the Secretary of State to conduct biennial audits of ODOT’s capital projects and use of state highway funds, and
• gives the governor, rather than the state Transportation Commission, the power to appoint and fire the ODOT director.

The legislation does not fund any of the state’s major capital projects such as the $2.1 billion Interstate 5 Rose Quarter Improvement Project, which faces a massive funding shortfall in part due to federal cuts.

“This package doesn’t solve all of the issues we see going forward, so we’re hopeful for more conversation leading to a comprehensive solution later,” said Kirsten Adams, lobbyist for the Associated General Contractors’ Oregon-Columbia chapter.

Transportation funding was delayed when legislators could not agree on a package during this year’s regular session that ended June 27. Kotek called a special session to begin on Aug. 29, but legislative action was delayed due to the lack of a quorum.

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Gov. Tina Kotek on Tuesday announced she will call legislators into a special session in August in the hopes of passing a transportation funding bill.

The Legislature adjourned June 27 without reaching an agreement on a transportation package. New legislation is needed to avert pending layoffs at the Oregon Department of Transportation, Kotek stated in a news release.

“I am confident that lawmakers will step up next month to avert these layoffs by approving the necessary funding for the state’s transportation needs,” Kotek said. “I appreciate their partnership and am eager to be on the other side of this crisis.”

Kotek said her priority is to deliver needed funding for the state highway trust fund for the 2025-27 biennium.

A funded ODOT budget will halt the pending layoffs and maintain operations at maintenance facilities that are otherwise scheduled to be shuttered, Kotek said. The agency began laying off 483 workers on July 7. But Kotek directed ODOT to postpone the effective date of the layoffs for an additional 45 days.

“The special session will be focused on critical near-term solutions to stabilize basic functions at ODOT and local governments,” Kotek said. “This is just the first step of many that must be taken to meet our state’s long-term transportation needs.”

More layoffs are planned for early 2026 unless the Legislature approves funding, she said.

Recently, a key holdout on the bill, Sen. Mark Meek, D-Gladstone, said he would be open to a special session, but that he wants Kotek to agree to repeal a state statute that authorizes tolls on interstates 5 and 205.

Notably, Kotek’s announcement did not address funding for any of Oregon’s mega-projects, such as the Interstate 5 Rose Quarter Improvement Project or the Interstate Bridge replacement and highway expansion project.

The Legislature will reconvene on Aug. 29.

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Oregon State Sen. Mark Meek said that he is open to Gov. Tina Kotek recalling the Legislature for a special session on transportation funding — if the governor agrees to repeal a tolling law.

“I’m open to that,” he said. “I told the governor, I committed that if the final package looks good, I’m happy to be there. But one of my requests is to repeal ORS 383.150.”

The tolling statute, on the books since 2017, directs the Oregon Transportation Commission to establish a toll program and assess potential tolls on interstates 5 and 205. Plans by the Oregon Department of Transportation to pay for roads and bridges with tolling has foundered amid political opposition and planning obstacles.

Meek’s comments, in a brief interview on Sunday, come amid speculation that Kotek will reconvene the Legislature in a special session to tackle transportation funding. The regular session ended June 27 in acrimony after a major transportation bill ran out of gas.

Kotek’s office did not specifically respond to Meek’s comments. “The governor is assessing next steps,” a spokesperson said Monday.

Meek said he’s been in discussions with Kotek and other state leaders since the session ended without a transportation funding package.

“I’ve had several communications with the governor and her staff, and we are working on a special session to try to keep our ODOT workers out in the field, maintain the roads for Oregonians and then also make sure that we can rebalance HCAS,” Meek said, referring to the state Highway Cost Allocation Study.

The biannual study, conducted most recently by ECONorthwest for the state Office of Economic Analysis, helps lawmakers determine how to spend transportation funds. It has played a role in the heated debate in Salem about who benefits from and who pays for transportation levies, including the gas tax, weight-mile tax and vehicle registration fees, and how that should be divided between the trucking industry and regular commuters.

Meek, D-Gladstone, has fought tolls in the Legislature. Meek’s Clackamas County constituents have been in an uproar over potential tolls on the Abernethy Bridge, the I-205 span connecting West Linn and Oregon City.

Meek said his constituents should not bear the brunt of Oregon’s tolling program. He said the tolling law is “so harmful and damaging to my community in Clackamas County.”

Meek called for “an honest discussion about what tolling looks like here in Oregon, or at least in my community.”

The bridge is undergoing a major project to strengthen it in case of an earthquake, and to widen the roadway to increase capacity. The project is expected to be complete next year.

The Legislature adjourned without passing House Bill 2025, a wide-ranging transportation funding bill. Meek was removed from the Joint Transportation Reinvestment Committee by Senate leaders after he said he would not support the bill.

Republicans and some Democrats were leery of the numerous revenue-raising provisions in the bill, including raising the 40-cent gas tax by 15 cents, indexing it to inflation, and hiking vehicle registration fees.

Supporters argued that the state must complete a series of major transportation projects, including the Interstate 5 Rose Quarter expansion, which would also create highway covers to repair the street grid in Portland’s Albina neighborhood, and fund regular road maintenance.

After lawmakers went home, ODOT laid off at least 483 workers and began canceling minor road projects around the state.

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