The Oregon Legislature’s Joint Committee on Transportation Funding will consider legislation this week called “LC 2” as they head into a special session to address transportation funding.

The Governor’s Transportation Budget Framework defines the problem as an ODOT “budget gap” that needs to be addressed with a “funding solution.” She says that the cause is a lack of revenue for ODOT, oft repeated by legislators, lobbyists, and journalists who describe the problem as “declining revenue,” or a “dwindling gas tax.” These statements are simply not supported by ODOT’s financials showing that net revenue grew by 30 percent since 2018 and reached record highs in 2024.

A spending problem, not a funding problem, is the reason ODOT is about to eliminate 900 positions. The real problem is two-pronged: first, too many statutory restrictions on existing revenue; and too much debt service on $4 billion in highway bonds, which have grown at a much faster rate than ODOT’s revenue.

In reviewing LC2, Cascade offered the Committee two suggestions. First, amend LC 2 to free up gas tax funds for services Oregonians need and have already paid for. Next, pay off these highway bonds with lottery revenues. This would increase ODOT’s available gas tax revenue by more than 50 percent without a tax increase.

Governor Tina Kotek has called a special session of the legislature to secure more funding for the Oregon Department of Transportation (ODOT). She wants to raise gas taxes by six cents per gallon, double vehicle registration fees, and increase titling fees.

The governor claims that ODOT revenue has been declining due to improved fuel economy of cars, but comprehensive annual reports online show the opposite, as does the Legislative Revenue Office presentation. In 2024 gas tax revenue hit an all-time high of $652 million, as nearly did registration and titling fees ($550 million) and weight and mile fees ($455 million). Total ODOT revenue increased by 30 percent between 2018 and 2024 while debt service increased 41 percent and is growing. The debt is not scheduled to be retired until 2049.

It’s not a revenue problem; it’s a spending problem.

First, since 2001, as part of the Oregon Transportation Investment Act bond program (OTIA), the legislature has forced ODOT to spend most new gas tax monies on construction projects while ignoring highway maintenance. Thus, while gas tax revenue has increased, the amount going to operations has decreased.

Secondly, the legislature voted to sell nearly $4 billion in bonds backed by gas tax revenues. As a result, ODOT paid $358 million out of the gas tax revenues toward debt service last year compared to only $70 million in 2007.

To paraphrase Warren Buffett, debt service is the tapeworm eating 55 percent of ODOT’s gas tax money.

When legislators meet on August 29th, they should repeal gas tax restrictions put in place by OTIA Programs I, II and III. They should also pay down ODOT’s remaining bond debt of $3.9 billion with lottery funds. This would free up gas tax revenue to be spent on road maintenance and set a course correction ODOT and the people of Oregon need.  

The Oregon Department of Transportation (ODOT) has a $350 million deficit. Governor Tina Kotek has said that if this funding is not secured, she will lay off about 500 ODOT employees.

During the regular legislative session that ended in June, Democrats (who hold a supermajority in both the House and the Senate) could not reach a consensus on a transportation funding bill (HB 2025). Sidelining and ignoring Republicans further ensured that the bill would not pass.

To deal with the budget shortfall, the Governor has called for a special session for Friday, August 29. Her goal is to raise the gas tax by six cents ($.06), increase vehicle registration fees by $42, and raise title fees by $139.

House Minority Leader Christine Drazen has proposed an alternative. Instead of raising taxes and fees on Oregon motorists, the legislature could use emergency funds from the Legislative Emergency Board. Hundreds of millions of dollars are set aside every legislative session for use in an emergency. Using emergency funds would not raise the gas tax and could fund ODOT until the 2026 session when a working solution can be found.

Oregon currently has the fourth-highest gas prices in the nation. Raising the gas tax should not be an option. Legislators should find a way to fund important transportation maintenance services without punishing Oregonians at the pump.

Governor Tina Kotek has long expressed support for wind power. In 2024, the Biden administration approved 195,000acres off the southern Oregon coast for wind farm construction (Wind Energy Areas) as part of its push to grow offshore wind power capacity, which gave her the means to enact this vision. However, widespread opposition from residents, including fishermen, tribal nations, and local politicians, expressed concern over the harm it would bring to the ecosystem and local industry.

When these wind farms started to look like a possibility, Kotek asked Biden to halt the project for further research into the potential effects of offshore wind farms on the localcommunity. By requesting the delay, she could torpedo the plan without appearing to backpedal on her previous platform.

However, Kotek was recently tossed a lifeline from an unexpected source. The Trump administration’s Bureau ofOcean Energy Management, or BOEM, has rescinded all wind power plans for the southern Oregon coast, to the relief of communities in those areas. This new Kotek and Trump alliance has handed the governor the pause on offshore wind she likely wanted. Don’t hold your breath, however, waiting for the Governor to send Trump a thank-you note.

On July 31st, the seven Metro councilors will vote to borrow $88.5 million to help pay for five transit projects that include “road diets” in and around Portland. Once approved, Metro will have to repay the loan until 2039.

To obtain the $88.5 million now, Metro will pay $140 million in principal and interest over the next 14 years. That’s nearly $50 million lost to debt service, money the agency can’t spend on capital investments or region-wide programs.

Which projects are so urgent that Metro councilors are willing to lose $50 million? One is a 0.65-mile streetcar extension on NW 23rd Avenue, Portland, a route already served by buses. Most of the budget for that project would actually go to purchase a new fleet of streetcars to be used elsewhere.

Another project shrinks 82nd Avenue from a four-lane highway to two lanes for cars, and restricts the outer lanes to TriMet buses for up to seven miles.

A third project is a new Burnside Bridge, with fewer lanes than it currently has, while keeping the bus-only lane. This leaves only one eastbound lane for 45,000 people who use the bridge daily. As it is, the bridge consistently backs up for blocks during rush hour. Taking away a lane for traffic will make congestion much worse on Burnside.

If you don’t agree with these proposed road diets and mounting debt service, let your Metro councilor know at this week’s council meeting on July 31st at 10:30.

The new “Earthquake Ready Burnside Bridge” lane designs, backed with funding by the Metro Council, are intended to force Portlanders out of their cars. Metro will be meeting on July 31st to vote on and pass the Step 1A.1 Regional Flexible Funds Allocation bond, which includes the Burnside Bridge among other “road diet” projects.

The current Burnside Bridge serves approximately 58,000 people daily and features five lanes of travel, comprising two westbound lanes, two eastbound lanes, and an eastbound bus-only lane. In the design for the new bridge, they plan to remove an eastbound car lane. This reduces a five-lane bridge with four lanes for cars, with a four-lane bridge with three lanes for cars.

While Metro’s stated goal is to promote “multimodal transportation,” they plan to achieve it at the expense of nearly four out of every five people using the bridge. If 100 people were crossing the bridge, 78 would be stuck in a bottleneck after a long day of work. Another 12 people would ride the bus, 7 would bike, and 3 would walk. Why should 78 people have to sit in traffic so that 12 people can get ahead on a bus?

Metro should reject funding for the Earthquake Ready Burnside Bridge until the lanes have been redrawn, and designs changed to make room for four out of every five bridge users.

TriMet has a new “road diet” planned for Portland, this time on 82nd Avenue. Working with Metro, TriMet is proposing a transit corridor entirely dedicated to buses. They plan to dedicate bus-only lanes, up and down both sides of the street, shrinking 82nd from a four-lane avenue down to a two-lane road for up to seven miles—from Clackamas Town Center to Portland’s Cully neighborhood.

The project claims that bus-only lanes are only one of the options as part of ongoing conversations, but the most recent Metro mockup on the future of 82nd Avenue prominently prioritizes “BAT lanes” (Business Access and Transit lanes) as the locally preferred alternative (LPA).

By cutting car lanes in half, the bus-only lanes will increase congestion substantially. According to TriMet’s own estimates, adding these lanes would cause up to 25 percent of drivers to divert from their routes to avoid traffic. Those diversions will put more stress on residential streets and neighborhoods, requiring additional safety features and maintenance. In the same document, TriMet states these new bus-only lanes will save transit riders three or four minutes at most. That’s with seven straight miles of bus lanes.

The purpose of 82nd Avenue—also known as Highway 213—is to move as many people and vehicles as possible from point A to point B. What moves more people: a lane that allows both cars and buses, or a lane that only allows buses?

Metro Council is scheduled to consider bond funding for 82nd avenue and four other projects on July 31. Metro should eliminate bus-only “BAT lanes” from any further consideration as part of the 82nd Avenue Transit Project.

With the passage of House Bill 2089 in late June, Oregon has ended the practice of “home equity theft,” by bringing state law into compliance with the Supreme Court’s unanimous 2023 Tyler ruling. Two years ago, the U.S. Supreme Court ruled in favor of a Minnesota grandmother, Geraldine Tyler, who lost her condo when she failed to pay the property taxes. Ms. Tyler argued that her county violated the Constitution’s Takings Clause when it kept a $25,000 surplus after her property was foreclosed and sold to pay the taxes.

Oregon has been one of nine states whose tax foreclosure laws allowed such “home equity theft.” The key requirement of the unanimous ruling in Tyler v. Hennepin County⁠ says governments must create a system to return surplus equity to owners after property taxes, fees, and interest are paid on foreclosed property. After the Tyler decision, it became clear Oregon’s law needed revision.

Cascade Policy Institute worked with Pacific Legal Foundation (who represented Ms. Tyler) and other stakeholders to bring Oregon law into compliance with Tyler. House Bill 2089 provides a process to ensure that counties retain what they are owed in back taxes, and no more, giving the original owner claim to any surplus value.

The Tyler ruling was a big victory for property rights, effectively ending the practice of government “home equity theft” by ruling it unconstitutional. HB 2089 ends home equity theft in Oregon, too.

The Oregon legislature ended on June 27 without addressing the deterioration of Oregon’s road system. This turned out to be a stunning defeat for the Democratic majority on House Bill 2025-B, also known as the Transportation Reinvestment Package (TRIP).

For more than a year, Democrats held several hearings promising to address the problem with a “transportation package” of reforms. They never introduced their proposal, however, until June 9, less than three weeks before the close of the legislative session. The $12 billion (official revenue impact) transportation funding proposal included a dozen new taxes and fees on everything from personal income to car tires. Not only did every Republican legislator oppose it, but key Democrats did as well. The bill never had a chance.

As time ran out, Democrats introduced a different bill HB3402, generating even more opposition. Before the legislature adjourned, not a single floor vote had been taken on the transportation package.

If Democrats want to solve the transportation finance problem, they should return to the user-pay system which has served the state well for decades. In a user-pay philosophy, transportation users pay a fee in proportion to the cost they impose on the system. If it is fair to all users, they will find political support. Voters aren’t interested in unfair and heavy-handed new transportation taxes.

New Hampshire has removed the income cap for families applying to its Education Freedom Account program, making it the first state in New England to offer school choice to all K-12 children. Governor Kelly Ayotte signed the program expansion into law on June 10. Previously, first-time applicants had to have incomes below 350% of the federal poverty level to qualify.

Total program enrollment will be limited to 10,000 students in the first year of the program’s expansion. If more students apply than there are spaces available, the program will prioritize current participants and their siblings, students with special needs, and low-income students.

New Hampshire’s four-year-old EFA program is one of the most family-empowering school choice laws in the country. EFAs can be used for a wide variety of approved education expenses. Each child’s EFA is funded by the state’s “per-pupil adequate education grant amount,” plus any additional aid that would have been allocated in a public school (for example, if the student qualified for free- or reduced-price lunch or special-needs funding or was an English-language learner). The state contracts with the nonprofit Children’s Scholarship Fund New Hampshire to administer the program.

New Hampshire follows Tennessee, Idaho, Wyoming, and Texas in expanding educational opportunities available to their children this year. It’s time Oregon gave the same chances to students here, too.