The Ways and Means Natural Resources Subcommittee voted to adopt the Legislative Fiscal Office (LFO) recommendation on Senate Bill 5,520, advancing the Department of Environmental Quality’s biennial budget to the full Ways and Means committee.

The LFO presented a recommended budget totaling $966,406,946, including $85,307,531 in general fund, $7,038,076 in lottery funds, $346,894,304 in other funds expenditure limitation, $164,535,060 in federal funds expenditure limitation, and authority for 894 positions equal to 885.36 FTE; the committee adopted a dash-1 amendment reflecting those totals and voted to move the bill forward.

Why it matters: the package contains large federal and bond-supported programs — including more than $340 million in other funds nonlimited for the Clean Water State Revolving Fund loan program and roughly $231 million in policy packages — that finance statewide water, air and cleanup activities. Committee members questioned whether fee increases and added staffing are producing timely permit decisions and expressed concern about impacts on businesses and small wastewater providers.

Key facts and committee discussion

- The LFO outlined the full package, saying the recommended budget “totals $966,406,946” and represents a 23.8% increase over the current budget and a 31.5% increase over current service level, primarily driven by increases in federal funds expenditure limitation related to grant awards.

- The recommendation includes roughly $231 million across 20 policy packages, which the LFO summarized as including approximately $2 million general fund, $18 million other funds, $122 million in federal funds expenditure limitation, and $90 million other funds nonlimited for the Clean Water State Revolving Fund Loan Program.

- The committee discussed several program-level requests during the presentation:
- Air Contaminant Discharge Permitting (ACDP): a proposed ~20% fee increase and five permanent positions to “maintain service levels.” Matt Davis of the Department of Environmental Quality said, “The fees for this particular program were last raised 6 years ago…we communicated to fee payers that we would be back in about 6 years with about a 20% fee increase request.” He added the program meets backlog key performance measures but that timeliness targets vary by permit type (from 30 days to a year).
- Cleaner Air Oregon risk assessments: a package to add $1,000,000 in other funds expenditure limitation and three permanent positions to accelerate risk assessments.
- Greenhouse gas reporting: a revenue-only modification that the LFO said would yield about $950,000 in the 2025–27 biennium.
- Water programs: the package 120 would authorize fee increases across four water quality programs and restore two full-time positions for the on-site septic system program; package 170 would add over $1.2 million general fund and three positions to restore positions abolished earlier due to federal funding shortfalls.
- Materials management/solid waste: package to add about $1,000,000 in other funds expenditure limitation and four permanent positions, paid from tipping fees.
- Orphan site bond proceeds: $10,000,000 in other funds nonlimited to replenish the orphan site account, per a 2023 bond authorization; related debt service and short-term bonding for state match were also described.

Committee members pressed for follow-up and additional information:
- Representative Lively repeatedly asked about how fee increases would change permit turnaround and whether regulated entities were receiving timely service; Matt Davis offered to provide a more detailed report on timeliness by permit category.
- Members including Co-Chair Levy, Representative Lively and other legislators expressed unease with the overall percent increase and asked for budget notes and follow-up hearings. One member said, “I have to tell you this budget... I'm not very comfortable with,” and emphasized concerns about results relative to spending.
- The committee acknowledged that some positions are paid via settlements or cost recovery and that recent legislation (for example, the Recycling Modernization Act) could drive additional workload and questions.

Formal actions and votes

- Motion: Adopt the LFO recommendation on Senate Bill 5,520 (motion moved by Co Chair Frederick). Outcome: passed. Roll call for the motion (as recorded during the meeting): Senator Anderson — No; Senator Dorsick — Yes; Senator Frederick — Yes; Representative Breece Iverson — Courtesy yes; Representative Owens — No (courtesy yes earlier in one roll); Representative Lively — Yes; Representative Levy — Yes; Representative Hartman — Excused. (Recorded tallies varied across related roll calls; the committee adopted the dash-1 amendment and moved the bill to the full committee with a due-pass recommendation.)

Discussion vs. decision

- Discussion: committee members asked for timeliness data, raised concerns about fee increases and program performance, and requested future informational hearings (for example, an informational hearing on Title V permit processing was noted for a different committee).
- Direction/assignment: staff (LFO/DEQ) were asked to provide follow-up information on permit turnaround times by permit category and to coordinate future briefings.
- Formal action: the LFO recommendation and the dash-1 amendment to SB 5,520 were adopted and the bill was referred to the full Ways and Means committee with a due-pass recommendation.

What’s next

The committee forwarded SB 5,520 as amended to the full Ways and Means committee. Members indicated plans for follow-up briefings and at least one informational hearing on permit processing and Title V air quality permitting.