Pushback Mounts Against Oregon’s Planned Transportation Tax Hike

On Nov. 7, Gov. Tina Kotek signed Oregon House Bill 3991 into law. But before it can take effect, a petition may send it to next year’s ballot instead, giving Oregon voters the power of a thumbs up or thumbs down.

The new legislation will raise the state gas tax by 6 cents, raise the registration fee for most passenger vehicles by $42, and increase title fees from $77 to $216 for most vehicles.

HB 3991, primarily a funding package for the Oregon Department of Transportation, also raises a temporary payroll tax that funds public transit statewide, doubling it from 0.1% to 0.2% until January 2028.

“For a worker earning the average Oregon salary of about $68,000, the extra cost during that period would be $5.60 per month,” ODOT spokesperson Kacey Davey said in a statement to the Source.

In a signing letter to Secretary of State Tobias Read, Kotek said the bill “helps prevent cuts to [ODOT] and communities across the state that would have posed a significant danger to Oregonians’ safety and ability to get to where they need to go,” and “helps us keep state highways and local roads safe and open to traffic while preserving transit service and halting the pending layoffs of essential transportation staff.”

ODOT estimates that the average Oregon taxpayer will “pay about $66 more annually in registration fees and gas taxes.” This tax revenue goes to the State Highway Fund, “which distributes money to ODOT, counties, and cities to maintain and improve Oregon’s roads and bridges,” and is “divided 50/30/20 among ODOT, counties and cities,” Davey said. “ODOT’s share will be used for operations and maintenance, supporting essential work such as snow and ice removal, clearing rockfall and landslide debris, reopening lanes after traffic incidents and other critical maintenance activities across the state.”

Opponents of the tax hikes are making noise through a petition, which could prevent the bill from taking effect on Dec. 31. Instead, voters would decide on the matter at the November 2026 election.

The signature-gathering effort is led by No Tax Oregon, an organization created to fight HB 3991. Its campaign is funded by the brand-new “Right to Vote on the Gas Tax PAC,” formed by Republican state lawmakers Sen. Bruce Starr (R-Dundee) and Rep. Ed Diehl (R-Scio), plus Taxpayers Association of Oregon founder Jason Williams.

“When compromise and numerous chances for bipartisanship are ignored, the People of Oregon deserve a vote,” Starr wrote in a guest column for a conservative blog, calling the increases “devastating.” No Tax Oregon’s initiative is “the largest volunteer signature effort the state has seen in years—possibly ever,” according to Diehl. “People aren’t just willing to sign; they’re seeking us out,” the representative said. “Oregonians want the right to vote on these taxes and fees, and they know Salem is not representing their interests.”

A pamphlet issued by No Tax Oregon reads, “Some parts of the bill are actually positive, and we didn’t want to undo them,” mentioning “audit oversight and governance reforms that are generally constructive.” But in their view, HB 3991 isn’t a “transportation plan that reflects what Oregonians actually want — an accountable, efficient agency that puts road maintenance first.”

Although public outrage has mostly revolved around the gas and vehicle fee hikes, the doubled payroll tax is an important factor of HB 3991. While the former provides money to the State Highway Fund, the payroll tax revenue goes “directly into the Statewide Transportation Improvement Fund (STIF), which distributes revenue to public transit providers throughout Oregon based on population size,” Davey said. “It supports transit in every corner of the state and provides a crucial option for people who cannot or do not drive, allowing them to access work, education, healthcare, and other essential services.”

Deschutes County has received over $4.3 million from the STIF this year. But not all voters here are convinced that the STIF or ODOT need the extra revenue.

“This is the governor, House and the Senate trying to make decisions for all of us,” said Neil Ripsch, a Deschutes County organizer for No Tax Oregon. “She is one-sided, they are being one-sided, and to hell with everybody else.”

Ripsch collects signatures inside a Larkspur gas station deli. Credit: Kayvon Bumpus

Ripsch believes that the tax overburdens working Oregonians in an unjustifiable way. “I think everybody is going to be impacted. It’s getting so damn lopsided, it’s hard for a family to survive,” he told the Source, sitting behind a table inside Expressway Market & Deli, a gas station in the Larkspur neighborhood. No Tax Oregon will gather signatures there through at least Dec. 7.

Kotek and ODOT’s justification for raising taxes has failed to convince rural voters, business owners and conservatives like Ripsch. “Without this [tax increase] going into effect, I think there will still be plenty of road work, etcetera,” Ripsch said.

“The Governor is presenting a false choice,” No Tax Oregon’s pamphlet claims. “By reprioritizing spending within ODOT and allowing more of its existing funds to go toward maintenance, Oregon’s roads can be properly maintained without raising taxes or fees.”

ODOT spokesperson Davey told the Source that that the extra funds will be “critical” to “operate and maintain Oregon’s transportation system,” and that the agency could be in big trouble, financially and operationally, if HB 3991 is postponed by the petition or denied at next year’s ballot.

“This continued uncertainty is difficult for the agency. Many ODOT employees are worried about their own jobs and are worried about the ability of ODOT to continue to serve Oregon,” Davey stated. “Governor Kotek has directed ODOT to continue hiring for vacant winter maintenance positions while the agency’s funding situation is analyzed. We are working closely with the governor’s office to evaluate the state’s options to address impacts to the agency.”

More than 150,000 signatures have been collected by No Tax Oregon, according to Diehl, who tweeted, “We’re not stopping. We’re not quitting. We are going to send a message to Salem.” The Secretary of State will have to verify 78,116 of those signatures in order to certify the petition and put HB 3991’s fate in voters’ hands.

Editor’s Note: Updated Dec. 3 with additional information from No Tax Oregon campaign material.

This article appears in the Source December 4, 2025.