OregonHB 39912025 1st Special SessionHouseWALLET

Relating to transportation; prescribing an effective date; and providing for revenue raising that requires approval by a three-fifths majority.

Sponsored By: Sponsor information unavailable

Signed by Governor

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Bill Overview

Analyzed Economic Effects

29 provisions identified: 14 benefits, 11 costs, 4 mixed.

People gain damages for carrier violations

People harmed by covered motor carrier or railroad violations can seek damages for their losses. Damages are tripled when gross negligence or willful misconduct caused the violation. This remedy does not apply to liability for personal injury or property damage.

Automatic tax relief for overpaying drivers

Beginning January 1, 2030, the law provides automatic tax relief when a vehicle class pays too much toward road costs. A highway cost report must show an equity ratio of at least 1.05 for light or heavy vehicles. If lawmakers do not act within 120 days after the transportation committee receives the report, the state must lower applicable rates. Cuts start September 1 of an odd-numbered year and bring the affected class's ratio to 1.045. Fuel tax changes are rounded to the nearest 0.1 cent per gallon; applicable per-mile fees can also fall. The state must repeal its rate rule if lawmakers later adjust the revenue sources.

Drivers pay higher motor fuel taxes

Oregon raises its motor fuel tax from 34 cents to 46 cents per taxable gallon. That adds 12 cents for each gallon covered by the tax. Your added yearly cost equals your taxable gallons multiplied by $0.12. The supplied text does not give the start date.

Electric and hybrid drivers enter road charging

Covered passenger vehicles enter road charging in stages: non-new electric vehicles July 1, 2027; all electric vehicles January 1, 2028. Hybrid and plug-in hybrid vehicles join July 1, 2028; the ongoing definition covers all three types beginning July 1, 2031. Starting July 1, 2027, covered owners or lessees using Oregon highways pay per mile or elect $340 annually; lessees pay during leases. The mileage rate is 5% of the fuel tax rate when due—2.3 cents per mile at 46 cents per gallon. On July 1, 2031, the law also repeals prior application authority and a related 2019 provision, not the entire charging system.

Car renters get road-charge surcharge limits

Rental companies face a limit on road-usage charge surcharges for covered vehicles. The surcharge cannot exceed a reasonable estimate of the company's cost of paying that vehicle's per-mile charge. The law does not set a fixed dollar cap.

Covered vehicles avoid extra registration fees

Beginning July 1, 2027, vehicles covered by the road-usage charge law avoid specified extra state registration fees. The exemption applies to subject vehicles under ORS 319.883 and the additional amounts under ORS 803.422. It does not remove all registration fees. This provision does not state the dollar amount saved.

Lower wage tax for Oregon workers

Beginning January 1, 2028, the tax on covered wages falls from 0.2% to 0.1%. The savings equal $1 for every $1,000 in covered wages. The tax covers Oregon residents wherever they work and nonresidents for work performed in Oregon. Employers withhold and send in the tax. Separate reporting and payment rules apply to residents whose employers do not do business in Oregon.

Road charge relief and collection limits

For reporting periods starting July 1, 2031, voluntary road-charge participants are exempt from specified recording, reporting, and payment rules. The exemption does not cover periods when participation is required, and it ends January 2, 2037. Oregon's transportation department cannot let certified providers keep more than 10% of collected road charges for administrative costs.

Emergency waivers ease carrier fuel rules

Oregon's transportation director can pause specified carrier rules when an emergency occurs or is imminent to speed movement of people or property. These include fuel-tank inspections, tax enrollment, motor fuel tax requirements, and dyed diesel rules. Without a declared emergency, a pause lasts no more than 72 hours. With a declared emergency, it lasts until that emergency ends.

More funding for Oregon rest areas

Oregon's transportation department must send the Travel Information Council $12.16 million from the State Highway Fund by July 1 each year. That is up from $9.16 million. The money supports management, maintenance, improvements, and development of the roadside rest areas listed in law.

Lawmakers track major road project costs

Lawmakers review scope, schedules, changes, and budgets quarterly for transportation projects costing at least $250 million. Cities and counties must seek commission review for unfunded highway project expansions crossing specified cost thresholds. The threshold is 10% for projects under $25 million and 5% for projects costing $25 million or more. Approved expansions go to the transportation committee with their costs; lawmakers may recommend future funding. The committee also oversees the transportation and aviation departments.

More road funding for small cities

The law raises annual small-city road funding from $5 million to $6 million. Half comes from the city allocation and half from State Highway Fund money available to Oregon's transportation department. Eligible cities have 5,000 people or fewer, and roads must be within the city or under its authority. Projects address roads with inadequate capacity or unsafe conditions. Roads generally must be outside the state highway system, except for project work required by state or federal law.

Road revenue supports state and local roads

Specified increased transportation tax and fee revenue is divided yearly: 50% to the state transportation department, 30% to counties, and 20% to cities. Small counties receive 1.37% of the county share. By July 31 each year, qualifying money goes to counties with fewer than 200,000 registered vehicles. Shares reflect maintained road miles relative to registered vehicles. Counties must use these grants on existing non-state roads with inadequate capacity or unsafe conditions.

Transportation leadership changes and audits expand

Oregon's Division of Audits reviews transportation department performance every two years, including highway fund spending and capital projects. It presents its findings to a legislative committee. For new appointments after the law takes effect, the Governor appoints the transportation director, subject to majority Senate confirmation. The director serving when the law takes effect remains under prior appointment rules.

Lower mileage taxes for non-electric trucks

Beginning July 1, 2029, covered non-electric trucks pay lower weight-mile taxes under Table A. Rates depend on declared combined weight and taxable Oregon miles. Rates in mills per mile are: 26,001–32,000 pounds, 55.1; 32,001–38,000, 64.8; 38,001–44,000, 74.1; 44,001–50,000, 82.5; and 50,001–56,000, 95.6. Higher bands are: 56,001–62,000 pounds, 103.2; 62,001–68,000, 119.9; 68,001–74,000, 130.9; 74,001–80,000, 181.2; and 80,001–105,500, 189.8. One mill equals one-tenth of a cent.

Lower road fees for oversized loads

Beginning July 1, 2029, the road-use fee for covered single-trip permits falls from 10.9 cents to 7.9 cents. The rate applies per equivalent single-axle-load mile, a measure of road use based on axle loads and distance. It covers loads that cannot be divided. The fee applies to permit holders and people operating vehicles that require the permit.

Higher title fees for vehicle owners

The title fee for covered vehicles rises from $77 to $216, adding $139 per transaction. Exceptions cover salvage vehicles, eligible permanently registered trailers, and vehicles over 26,000 pounds other than motor homes. The higher fee applies to fees imposed on or after the law's effective date.

Vehicle owners pay higher registration fees

Base registration fees rise by $42 for each year of a two-year registration, adding $84 per renewal. Passenger vehicle fees rise from $43 to $85 per year. Utility and light trailers, low-speed vehicles, and medium-speed electric vehicles rise from $63 to $105 per year. Mopeds and motorcycles rise from $44 to $86 per year. The increases apply to fees imposed on or after the law's effective date.

Workers face higher wage tax provisions

One provision raises the covered wage tax from 0.1% to 0.2%, adding $1 per $1,000 of covered wages. It covers Oregon residents wherever they work and nonresidents for work performed in Oregon. Employers withhold and remit it; residents whose out-of-state employers do not do business in Oregon report and pay directly. The law also contains a competing 0.1% provision, with related start dates in 2026 and 2028. The supplied material does not resolve which rate controls each period.

Commercial vehicles face broader enforcement powers

ODOT gains broader power to inspect vehicles and facilities, run tests, and require information under covered transportation laws. Weighmasters and carrier officers gain specified citation and arrest powers over covered commercial vehicles, including those meeting 10,001-pound thresholds. Covered offenses include fuel agreement violations and improper dyed diesel use. Specified citations require a witnessed offense or evidence; certain citations to nonowner drivers count against the owning motor carrier.

Carriers face fuel-tax fees and permits

Oregon removes the $650 annual fee cap for carriers receiving International Fuel Tax Agreement benefits; fees must recover full agency costs and consider fleet size. Out-of-state carriers without a valid agreement license must obtain a fuel trip permit before operating covered vehicles on Oregon highways. Coverage excludes recreational vehicles and includes two-axle vehicles over 26,000 pounds, vehicles with three or more axles, and combinations over 26,000 pounds. Vehicles registered under ORS 826.009 or 826.031 are exempt. The department sets permit fees; each named vehicle gets at most three permits per calendar year, each valid for three consecutive days without a mileage report.

Carriers risk losing fuel tax licenses

The International Fuel Tax Agreement can authorize ODOT to suspend, cancel, or refuse renewal of benefits for covered violations. Those violations include agreement terms and state motor carrier or vehicle laws and rules. It can also authorize license denial or revocation on reasonable grounds supported by department records or hearing evidence. Failure to follow the agreement or related ODOT rules is a Class A traffic violation.

Dyed diesel misuse brings stronger penalties

Highway use of dyed diesel is barred unless federally authorized or eligible for refunds under the specified Oregon laws. Prohibited driving is a Class A traffic violation. Civil penalties can reach the greater of $10 per gallon of tank capacity or $1,000, plus equivalent fuel tax. A vehicle lien can also secure dyed diesel penalties; it starts at fuel use and remains until tax payment or sale to pay it. ODOT sets actual penalties, considers past violations and safety threats, and has discretion to reduce or cancel penalties.

Fuel businesses face tighter compliance rules

Fuel-tax definitions now include biodiesel, renewable diesel, and other diesel blends; dyed diesel remains outside the motor vehicle fuel definition. Fuel storage owners, operators, and maintainers must provide federally required markings. People cannot knowingly store dyed diesel in tanks or facilities intended for undyed diesel. ODOT can inspect fuel dealers' and brokers' records and equipment during business hours. Refusing entry or required records can trigger a civil penalty.

Separate mileage taxes for electric trucks

Beginning July 1, 2029, covered trucks powered only by electricity use a separate weight-mile tax schedule, Table E. Rates depend on declared combined weight and taxable Oregon miles. Rates in mills per mile are: 26,001–32,000 pounds, 79.6; 32,001–38,000, 93.6; 38,001–44,000, 107.0; 44,001–50,000, 119.1; and 50,001–56,000, 138.0. Higher bands are: 56,001–62,000 pounds, 149.1; 62,001–68,000, 173.2; 68,001–74,000, 189.1; 74,001–80,000, 261.7; and 80,001–105,500, 274.1. One mill equals one-tenth of a cent.

Efficient vehicles face changing registration extras

For vehicles rated at least 40 MPG, the extra registration fee rises from $35 to $65 per registration year. The electric-vehicle extra amount rises from $115 to $145. Beginning July 1, 2031, that electric-vehicle-specific extra amount ends. Vehicles exempt from the specified extra state registration fees still owe any applicable county or district registration fees.

Haulers face revised annual fee options

For qualifying dump-body haulers choosing annual fees, rates rise from $11.50 to $16.98 per 100 pounds on July 1, 2027. On July 1, 2029, rates become $17.69 for electric vehicles and $12.25 for others, per 100 pounds. This option covers listed loads such as sand, gravel, dirt, asphalt mix, ores, and raw mine or quarry products. On July 1, 2027, the $9.60 annual option per 100 pounds ends for specified permitted vehicles under 46,000 pounds. The $47 option per 100 pounds also ends for wood chips, sawdust, barkdust, hog fuel, and shavings.

Logging truck fees fall, then split

These changes cover carriers choosing annual fees to haul logs, poles, peeler cores, or piling. On July 1, 2027, the rate falls from $11.60 to $10.50 per 100 pounds of declared combined weight. On July 1, 2029, the electric-vehicle rate rises to $10.94 per 100 pounds. The rate for other vehicles falls further to $7.57 per 100 pounds.

Truck tax calculations change in stages

Beginning July 1, 2027, weight-mile taxes use combined weight shown in vehicle registration rather than an operating authority application. For combinations, this includes empty vehicle weights and their load. Revised tables use Table A generally and remove separate Table B treatment for certain vehicles over 80,000 pounds. Electric vehicles use Table E beginning July 1, 2029. Related tax amendments apply to taxes imposed on or after July 1, 2027, with a second group beginning July 1, 2029.

Sponsors & Cosponsors

Cosponsors

Committee JSSTF
Affiliation unavailable

Roll Call Votes

All Roll Calls

Yes: 72 • No: 45

Senate vote • 9/29/2025

Third reading. Carried by Pham. Passed.

Yes: 18 • No: 11