ODOT has lots of cash on hand, but can’t use it to stop layoffs

Oregon lawmakers’ failure to pass a transportation bill during the 2025 session leaves ODOT in an odd position: The agency is being forced to lay off nearly 500 workers later this month while it is sitting on billions of dollars that it can’t spend, at least not yet.

In a recent review of ODOT’s budget, the Legislative Fiscal Office noted that the department has set aside cash for “anchor” capital projects that are not yet fully funded, including:

• $5.5 billion (in partnership with the state of Washington) for the replacement of the Interstate 5 bridge between Portland and Vancouver, a project estimated to cost $7.5 billion.
• $570 million set aside so far for seismic upgrades of the Abernathy/Interstate 205 Bridge.
• $158 million for the expansion of Interstate 5 at Portland’s Rose Quarter (that number was once $608 million, but President Donald Trump’s One Big Beautiful Bill has at least temporarily cut a $450 million grant related to that project).

So the agency has money on hand, but not enough to build the projects yet. 

Portland economist Joe Cortright, a leading ODOT critic, has written that such capital projects suffer from persistent cost increases and have such large funding gaps that they may not happen in the foreseeable future.

“The critical question is whether the funds allocated to the anchor projects fund are sufficient to cover these costs,” Cortright says. “Clearly, they are not.”

ODOT has laid out schedules for work on the various large-scale projects, but given the funding uncertainty both in Washington, D.C., and Salem, project delays could mean that the money sits unused in the agency’s bank accounts.

Meanwhile, ODOT says layoffs scheduled for July 31 will cause the closure of 12 maintenance yards around the state and reduce the agency’s ability to respond to automobile crashes and do routine maintenance work, such as paving, patching and plowing Oregon highways.

So if the agency has cash set aside for projects that aren’t happening immediately and a short-term deficit in its operations and maintenance budget, could it avert layoffs by temporarily moving or lending money from those projects to another part of the agency and paying it back when lawmakers eventually pass a new funding bill?

The agency has shifted money around in the past, for instance, moving funds earmarked for the Rose Quarter project to the Abernathy Bridge project.  

But ODOT spokesman Kevin Glenn says the answer is no. 

“We cannot reprogram money from the Rose Quarter project to prevent layoffs of ODOT maintenance workers,” Glenn says. “All funding dedicated to the Rose Quarter comes from either HB 2017 Urban Mobility Strategy funds (the $30 million provided annually that must go to these projects under ORS 367.095) or from federal funds that cannot be used for maintenance.” 

The story is the same for other projects.  

“We also cannot reprogram money from the Interstate Bridge Replacement program,” Glenn says. “All funding dedicated to the project comes from either federal funds that cannot be used for maintenance or general obligation bonds authorized by the Oregon Legislature specifically for the project.” 

Glenn also rejects the idea that funding gaps for the capital projects mean they will be significantly delayed.

“While the funding crisis is having a profound effect on ODOT’s maintenance and operations, most construction projects will continue as planned,” he says.

“These projects are typically funded through separate capital programs, often with state or federal funds that are legally restricted to project development and cannot be redirected for maintenance or day-to-day operations. Delays may still occur due to a reduced workforce. Fewer available staff for traffic control, inspections and project oversight could slow down timelines or introduce challenges in project delivery.”