Lawmakers, small‑city officials urge tiered grant matches, cite projects stalled by high local matches

Lawmakers and municipal officials on June 4 urged the Senate Committee on Rules to advance House Bill 36‑54, which would set maximum matching fund requirements for state capital construction and municipal infrastructure grants to incorporated cities with fewer than 20,000 residents and allow grant funds to be used for all project phases including engineering and planning.

Representative Ed Deal, sponsor of the bill in the House, said the measure creates a sliding scale of matching percentages tied to city population and narrows the grants covered after agency review. He told the committee the dash‑2 amendment refines eligibility and the list of applicable grants and that the amendment language for Business Oregon, water resources and parks grants was provided by agencies.

Senator Todd Nash and Sean Tate, representing the Small Municipalities Advocacy Coalition, described how most Oregon cities are small and lack reserves, staff and borrowing capacity. Tate said 87 percent of Oregon’s cities have fewer than 20,000 residents and the average city’s population is under 7,400 — factors that “force a severely disproportionate fiscal impact when seeking critical infrastructure upgrades.”

City officials described projects they cannot afford under current match rules. Michelle Eldridge, city administrator of Harrisburg, said her city’s water project doubled in cost from its original bond estimate and that a $5.5 million replacement project would require a standard 20 percent match of $1.1 million; under the bill’s proposed sliding scale Harrisburg’s match could drop to 5 percent, or about $275,000, making the project feasible within a shorter timeframe. Brianna Parra, city administrator of Halsey, said a two‑block street project priced at about $250,000 could require a match approaching $140,000 under existing match rules — an amount she said could take the city roughly 10 years to save.

Ginger Allen, city manager of Scio, testified that aging sewer lines (some 60 to 66 years old) and small reserve balances prevent small cities from preparing engineering studies needed to even apply for grants. She said Scio’s sewer reserve rose from $86,193 on June 30, 2017 to $103,461 as of June 30, 2025 — a $16,268 increase largely from interest — and that without the ability to use grant funds for planning and engineering, many small cities “don’t even get up to bat.”

Supporters framed the bill as a matter of equity and economic resilience, arguing that easing match requirements and allowing grant dollars for planning will help small cities complete infrastructure projects that support housing and economic development. Several testifiers emphasized they were not seeking elimination of local responsibility but a more level playing field.

No formal committee vote on the bill was recorded in the Rules committee hearing; the measure received public testimony and the hearing was closed.

Background and clarifications: The dash‑2 amendment replaces the introduced measure and specifies the grants, funds and projects to which the maximum matching provisions would apply. Supporters submitted agency‑provided lists of eligible grants to the committee through OLIS. Testimony included concrete projects and local fiscal data; staff and agencies were cited as sources for the amendment wording.