ODOT warns of $242 million shortfall; agency outlines tiered cuts that could close DMV offices and maintenance stations

Lisa Sumption, interim director at the Oregon Department of Transportation, told the Joint Ways and Means Committee Subcommittee on Transportation and Economic Development on February 10 that ODOT faces a $242,000,000 State Highway Fund shortfall this biennium and that, depending on updated savings, the agency has also referenced a figure nearer $288,000,000.

"ODOT's facing a a budget gap of $242,000,000," Sumption said as she opened the agency’s informational presentation. Finance and budget division administrator Daniel Porter described an agency funding model that has been strained by a plateau in gas-tax revenue and by inflation-driven cost increases.

ODOT laid out a tiered approach to close the gap. Tier 1 is roughly $70 million in cuts composed largely of savings already achieved through belt-tightening and holding positions vacant. Tier 2 would add about $70 million (for a $140 million total) and require eliminating additional vacancies and laying off staff. Without legislative revenue changes, ODOT said it would implement all tiers and the combination of Tier 1–3 could reduce the agency workforce by more than 20 percent.

Porter and Sumption quantified several specific impacts if the worst-case scenario is required: eliminating approximately 1,000 total positions, removing 568 vacant positions and laying off about 471 current employees; closing DMV field offices and some maintenance stations; and closing eight rest areas. Sumption warned that those cuts would lengthen DMV lines and appointments, reduce incident response and winter maintenance, and delay needed IT upgrades.

The agency emphasized that some options—redirecting unobligated balances from programs created in House Bill 2017, pausing grant programs such as Safe Routes to School, or reallocating STIF/STIFF or privilege-tax funds—require legislative action. Sumption said that the programmatic provisions of earlier legislation (including work approved in "house bill 39 91") remain in effect even where revenue components were referred to the ballot.

Lawmakers pressed ODOT on operational trade-offs. The chair asked whether holding vacancies would meaningfully affect snowplowing, pothole repair and striping; Sumption answered that ODOT is "down almost 700 vacant positions" and that divisions must prioritize which posts to fill. Porter said reassigning staff is not always possible because many positions require specific skills.

Sumption and Porter repeatedly framed the choices as trade-offs between delaying grant-funded projects and losing operational capacity: "the impact is you're delaying projects ... versus the immediate impact of what you're losing on the system by having not people in the agency doing the work," Porter told the committee.

The co-chairs said they will weigh the options—including statutory changes to redirect existing revenue—while working to balance the budget in the short session and plan for the next biennium.