Oregon faces a $300 million transportation budget shortfall that threatens basic services like snowplowing and road repairs. Lawmakers entered a special session after failing earlier to approve a transportation funding package. The governor proposed a road usage charge for EVs equal to 5% of the state gas tax and a 6-cent gas tax increase to 46 cents per gallon, with phase-in starting in 2027 for certain EVs and expanding to hybrids in 2028. The shortfall prompted layoff notices to nearly 500 transportation department workers and plans to close multiple maintenance stations. Policymakers balance funding needs against privacy concerns and potential impacts on EV adoption.
Oregon could become the second U.S. state to require electric vehicle owners to enroll in a pay-per-mile program as lawmakers begin a special session Friday to fill a $300 million transportation budget hole that threatens basic services like snowplowing and road repairs. Legislators failed earlier this year to approve a transportation funding package. Hundreds of state workers' jobs are in limbo, and the proposal for a road usage charge for EV drivers was left on the table.
Hawaii in 2023 was the first state to create a mandatory road usage charge program to make up for projected decreases in fuel tax revenue due to the growing number of electric, hybrid and fuel-efficient cars. Many other states have studied the concept, and Oregon, Utah and Virginia have voluntary programs. The concept has promise as a long-term funding solution, experts say. Others worry about privacy concerns and discouraging people from buying EVs, which can help reduce transportation emissions.
"This is a pretty major change," said Liz Farmer, an analyst for The Pew Charitable Trusts' state fiscal policy team, noting "the challenge in enacting something that's dramatically different for most drivers."
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