QuickTake:

Oregonians may face a 6-cent increase in the state fuel tax after the Legislature meets in an August special session. Gov. Tina Kotek and Lane County legislators say the increase would help the state’s transportation infrastructure — and provide funding to cities and counties. 

Gov. Tina Kotek has called Oregon lawmakers back to Salem on Aug. 29 to complete a formidable task: passing a transportation package that eluded the Legislature during its regular session. 

A central pillar of Kotek’s goal is passing a 6-cent fuel tax increase that would help the Oregon Department of Transportation continue maintenance work, like fixing potholes, paving roads and plowing state highways. ODOT would receive half of the fuel-tax proceeds; the other half would go to counties and cities for local transportation needs.

Oregon House Speaker Julie Fahey, D-Eugene, told Lookout Eugene-Springfield staff in an interview Wednesday, July 23, she’s confident the Legislature can pass the package in the special session.

“I’ve had lots of conversations with individual members about what they want to see and what they don’t want to see,” Fahey said. “And I think the current framework that we’re working off of incorporates that feedback.”

One key is the revenue-sharing system, Fahey said, with 50% of revenues from the fuel-tax increase going to ODOT, 30% going to counties and 20% going to cities.

This would provide money for cities and counties to maintain local roads, bridges and other infrastructure that aren’t ODOT’s responsibility. ODOT is responsible primarily for interstate and state highways.

“One of the pieces of feedback that we heard was that people really cared about their transportation funding for their cities and counties as well,” Fahey said.

The framework, which Kotek released in a separate press conference Wednesday, is slimmed-down compared to some of the options the Legislature considered and rejected. An earlier proposal during the session initially sought a 10-cent fuel tax increase. A proposed 3-cent gasoline tax increase also died at the end of the session, when House Republicans wouldn’t let it move forward for a vote.

Kotek said she does not know yet which Republican members of the Legislature will vote for the proposal.

“But I do think people understand that this package is necessary, that this proposal is necessary, and it is based on past practice of how we fund these services,” Kotek said. 

Oregon House Speaker Julie Fahey speaks during a town hall at the Prince Lucien Campbell Building on the University of Oregon campus in Eugene, Ore., on Wednesday, April 9, 2025. Credit: Max Unkrich / For Lookout Eugene-Springfield

Proposal details 

The state’s current gasoline tax is 40 cents per gallon. Some cities — including Eugene, Springfield and Cottage Grove — have local gasoline taxes on top of that. Eugene’s tax is 5 cents a gallon. In Springfield and Cottage Grove, it’s 3 cents a gallon.

Besides the fuel tax increase, Kotek also wants to shore up transportation funding with increases in registration and title fees, including another $42 in registration fees; a supplemental $30 fee for electric vehicles and a $139 increase in the vehicle title fee.

Kotek also wants to double the 0.1% payroll tax for transit. For a person earning $50,000 annually, that payroll tax would increase from $4.17 to $8.33 per month.

Local needs 

Kotek’s call for the special session will delay — but not cancel — the layoff notices that recently went out to hundreds of ODOT workers. That delay lasts until Sept. 15, meaning that the special session could avoid the layoffs entirely if lawmakers pass a bill.

The delay until mid-September also applies to plans the transportation agency made to close down 12 maintenance stations, including one in Veneta. 

“I’ve been super-clear with folks as we’ve been working on this over the last couple of weeks: Oregonians rely on basic services provided by the Oregon Department of Transportation, whether that’s brush clearing on highways to prevent wildfires, plowing in the winters, the maintenance stations, the immediate response on the roads,” Kotek said. 

Sen. James Manning, D-Eugene, said in an interview that he was disappointed the package didn’t pass in the recent session, given the importance of that work and its role in public safety.

“I was really disappointed that we didn’t get it done this time, but I am pretty confident that we will get it done during the special session,” he said.

Ben Botkin covers politics and policy in Lane County. He has worked as a journalist since 2003, most recently at the Oregon Capital Chronicle, where he covered justice, health and human services and documented regional efforts to combat fentanyl addiction. Botkin has worked in statehouses in Idaho, Nevada, Oklahoma and, of course, Oregon. When he's not working, you'll find him road tripping across the West, hiking or surfing along the Oregon Coast.