Salem, OR. — A sweeping $15 billion transportation funding bill, House Bill 2025, is moving through the Oregon Legislature, aiming to address critical infrastructure needs while drawing scrutiny over tolling, tax hikes, and legislative process concerns.
The A-Engrossed version of HB 2025 outlines a 10-year revenue strategy that includes increasing the state’s gas tax, raising vehicle registration and title fees, and introducing new taxes on car sales. The bill is projected to generate nearly $2 billion per year by 2029, according to the Legislative Fiscal Office analysis.
Key Funding Measures
Among the bill’s major provisions:
- A 15-cent increase to the gas tax, raising it from 40 to 55 cents per gallon by 2029, indexed to inflation thereafter.
- New taxes on vehicle sales: 2% on new cars and 1% on used cars priced over $10,000.
- Higher title and registration fees, especially for electric and fuel-efficient vehicles.
- Expansion of the weight-mile tax for trucks and diesel vehicles.
The bill analysis emphasizes that more than 90% of the funding would go toward maintenance and preservation across state, county, and city road systems. However, critics point out that the bill also includes an “Anchor Fund” of $125 million per year to support expensive highway megaprojects—like the Interstate Bridge and Rose Quarter improvements—which could cost up to $5 billion in total.
Tolling and Per-Mile Fees Raise Eyebrows
Although Oregon’s current tolling moratorium remains in effect through 2026, HB 2025 lays the groundwork for significant changes to how road use is taxed.
Under the bill, most electric and hybrid vehicle owners would be automatically enrolled in Oregon’s mileage-based fee program (OreGo) starting July 2026. These drivers would have the option of paying a flat fee instead, but critics warn that such changes may disproportionately affect rural drivers and low-mileage commuters.
The new mileage-based structure comes amid growing public resistance to tolling, particularly in the Portland metro area, where prior tolling proposals have faced intense backlash. As reported by the Statesman Journal, lawmakers sent the bill back to committee for amendments amid bipartisan concerns about transparency and fairness.
Partisan Friction and Legislative Drama
The bill passed the Joint Transportation Committee on a party-line 7–5 vote, with all Republicans opposed. Committee dynamics turned chaotic in recent days when Senate President Rob Wagner removed Sen. Mark Meek (D-Clackamas) for opposing the bill.
Further tensions erupted during debate when Sen. Chris Gorsek (D-Troutdale) allegedly shouted at Rep. Shelly Boshart Davis (R-Albany), prompting a formal complaint. Gorsek later resigned from his committee role following public backlash, as covered by KOIN 6 News and Right Now Oregon.
Davis called the bill “grossly irresponsible,” citing the late release of fiscal impact reports and the burden on working families. “This is one of the largest tax increases in Oregon history,” she said.
What’s at Stake for Voters
The bill’s fate could ultimately lie with the public. If passed, opponents may pursue a referendum to put the tax increases on the ballot, similar to past statewide rejections of transportation-related tax hikes.
Voters should also be aware of the long-term implications of the bill’s mileage-based fee mandate and the potential for tolling to return after the 2026 moratorium. Additionally, cost overruns on major projects like the Interstate Bridge Replacement could strain already ambitious revenue projections.
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The vehicle miles travelled fee is ridiculous as envisioned. There is a lesson we can learn from history. During the space race it became known that an ink pen would not work in a zero gravity environment. NASA spent millions of dollars and engaged engineering teams and undertook a massive effort to design and build a new pen that would work in zero gravity for their astronauts. Meanwhile, Russia issued pencils to their cosmonauts.
Here, ODOT has expended millions of dollars and contracted with outside vendors, hired permanent state employees, incurred new and enduring administrative costs and IT costs to create the new bureaucracy known as OReGO all to collect under $300 annually from owners of electric and hybrid vehicles. Instead, for no cost at all ODOT could collect the extra fee during the vehicle renewal function at DMV.
Use a pencil.