The Joint Committee on Transportation on June 26 adopted the dash‑28 amendment to House Bill 20‑25 and advanced the bill to the legislative floor with a due‑pass recommendation.

The amendment changes motor fuel and vehicle taxes, removes consumer price indexing for fees and taxes in the bill, raises a privilege (sales) tax on new vehicles and a higher rate on used vehicles over $10,000, and reallocates those revenues among an anchor projects account, a Great Streets program, an electric‑vehicle (EV) rebate fund, Connect Oregon, and a rail fund. It also directs specific one‑time and ongoing distributions — including $5,000,000 to a wildlife‑vehicle collision reduction fund and $25,000,000 for Safe Routes to School — and requires an LPRO‑contracted study on governance reform for passenger rail and transit.

The nut graph: supporters told the committee the package is necessary to preserve roads, transit service and public safety; opponents said the tax and fee changes are too large, risk regressivity, and fail to fix longstanding project‑cost and accountability problems at the Oregon Department of Transportation (ODOT).

Key provisions

- Motor fuel taxes: the amendment replaces two scheduled motor‑fuel tax increases set for 2026 and 2028 with a single 12‑cent per gallon increase effective Jan. 1, 2026, and removes the scheduled inflation adjustments planned to resume in 2029.

- Indexing: the amendment eliminates the bill’s consumer‑price indexing language for fees and taxes.

- Privilege tax and sales tax on vehicles: the amendment raises a privilege/sales tax rate to 2.25% on new taxable vehicles and applies the tax to the retail sales price of used vehicles over $10,000.

- Revenue distribution (percentages in amendment): 38% to anchor projects, 38% to Great Streets, 10% to the DEQ EV rebate program, 10% to Connect Oregon, and 6% to the rail fund (among other distributions referenced in the amendment).

- Targeted allocations: $5,000,000 to a wildlife‑vehicle collision reduction fund and $25,000,000 to Safe Routes to School; other distributions are specified in the amendment text and related sections.

- Governance study: section 183 requires the Legislative Policy and Research Office to contract for a study and report on governance reform options for passenger rail and transit in the state.

What supporters said

Representative Rob Nose, who represents parts of northeast and southeast Portland, urged passage as a safety investment for high‑fatality corridors such as Southeast Powell Boulevard. “If we pass House Bill 20 25 we’ll continue to let these dangerous roads...claim more lives and the cost to make them safer will only go up over time,” he said.

Transit and labor groups — including ATU 757 and SEIU Local 503 — told the committee the amendment protects transit funding and jobs. Bill Bradley of ATU 757 described the funding as necessary to sustain transit service and workforce investments made since 2017.

Advocates for pedestrians and bicycle safety likewise praised the dedicated funding for Great Streets and Safe Routes to School. Zachary Lauridsen of Oregon Walks said the amendment “puts real money behind safety.”

What opponents and skeptics said

Opponents ranged from small‑business and industry groups to rural and agricultural representatives. Daryl Fuller (representing vehicle dealer and related trade associations) and others opposed higher sales taxes on vehicles, saying the change raises costs on used and new vehicle purchasers.

Multiple witnesses and committee members raised questions about revenue estimates, specifically the diesel tax and weight‑mile tax assumptions. The Oregon Trucking Association warned that Legislative Revenue Office mileage assumptions undercount truck miles and could produce higher diesel revenue than forecast, which affects planned weight‑mile rates.

Several witnesses and observers criticized the bill for not addressing ODOT project‑management problems and cost overruns. Joe Courtright of City Observatory said the bill “writes a check that section 38% of the privilege tax can’t cash,” arguing the package underestimates the true cost of large anchor projects and will leave future budget gaps.

Clarifications on distribution and amounts

Committee staff and counsel provided several clarifications during the hearing. Senior deputy counsel Heidi Elliot confirmed the percentage allocations in the amendment; Catherine Jones and LRO staff clarified timing of distributions and provided a revenue estimate range — including that the change would likely increase EV rebate funding by roughly $5 million per year and reduce Connect Oregon funding by about $6.2 million per year starting in 2028 under the amendment’s structure.

Public testimony and record

The committee heard several hours of oral testimony (support, neutral and opposition) from legislators, labor, business, public‑interest groups, local officials and private citizens. Advocates for greater electrification and rail funding said the amendment does not go far enough on those priorities, while some rural and agricultural witnesses objected to new burdens on farm and heavy‑use vehicles.

Committee action and votes

Co‑chair McLean moved to adopt the dash‑28 amendment; the motion passed on a roll call in committee (recorded ayes and noes are listed in the actions array below). The committee then moved HB 20‑25, as amended, to the legislative floor with a due‑pass recommendation.

What happens next

The bill will now go to the House and Senate floors (the committee assigned Rep. McLean and the co‑chair as the house and senate carriers). Committee members and several witnesses said further adjustments and additional work will be needed in the 2026 session or sooner to address indexing, highway‑cost allocation issues, and ODOT accountability and long‑term preservation funding.

Ending note

Committee members on both sides said the package is imperfect but that delaying action risks continued deterioration of roads, bridges and transit services. Several members pledged to pursue follow‑up legislation on HCaTS/weight‑mile methodology, accountability, and additional revenue options.