A driver holds cash out of the window of their car while waiting to pay a gas station attendant to pump their gas, Friday, Aug. 4, 2023, in Portland, Ore.
Claire Rush / AP
Portlanders will have an opportunity this May to temporarily plug a hole in the city’s transportation budget by renewing its local gas tax. While the measure does not propose increasing the 10-cent-per-gallon tax, it still risks exasperating a public increasingly weary of tax measures.
But the measure’s rejection could have serious consequences.
“Should this fail to pass on Election Day, we should literally expect our road maintenance to decrease by about a third,” said City Commissioner Mingus Mapps, who oversees the Portland Bureau of Transportation. “The stakes here are existential.”
Voters first approved the 10-cent-per-gallon tax in 2016, to address a mounting road maintenance backlog. It was renewed in 2020. The tax has generated nearly $150 million for PBOT over eight years. That revenue has paid for pedestrian crossing signals, new sidewalks, speed bumps and street lighting on streets where the majority of deadly crashes occur, and dozens of other street and sidewalk maintenance projects.
If renewed, the city estimates the tax will cost average Portland drivers who use gas-powered vehicles about $2.50 per month.
If voters agree to extend the tax for four more years, it will generate just over $70 million to address street maintenance and safety projects. It includes $24 million for street paving, $9 million to improve pedestrian safety on busy streets, $6 million for potholes, and $4 million to maintain street lights and signals, among other projects. Mapps said that the four-year spending plan accounts for roughly 33% of PBOT’s anticipated maintenance budget over the next four years.
Related: Head of Portland transportation bureau discusses budget cuts
PBOT’s $32M budget gap
These projects, which pledge to improve public safety for anyone using Portland’s streets or sidewalks, come amid a record surge in traffic-related fatalities.
The measure also comes in the midst of a bruising budget season for PBOT. The transportation bureau is largely funded by public parking revenue and gas taxes — both at the state and city level. With more Portlanders switching to electric vehicles and fewer parking at meters or in city-owned garages due to remote work options, this revenue stream has become unstable.
This imbalance has left the bureau with a $32 million gap in its annual budget for the coming fiscal year, which begins in July. At the same time, PBOT is nearly $5 billion short of funding it needs to repair or replace aging city assets, like traffic signals, ramps, bridges, and pavement.
These financial woes will only be made worse if the gas tax — which the bureau calls the Fixing Our Streets program — isn’t renewed.
The current budget proposal relies on voters renewing the gas tax — which the bureau calls the Fixing Our Streets program — next month. If it fails, Mapps estimates that least 45 PBOT employees will immediately lose their jobs and dozens of projects will be put on hold.
“At this point, Fixing Our Streets is about making the community safe, but it’s also about saving jobs for people doing the work to keep us safe,” said Elliot Levin, a legislative advocate for the PROTEC17 labor union.
Related: Portland City Council will add city gas tax to ballot
PROTEC17 represents around 218 PBOT employees, many of which worked on projects funded by the tax. Levin said the union’s PBOT members won’t feel truly safe until the bureau establishes a more sustainable funding model that doesn’t rely so heavily on gas-powered vehicles.
“The tough reality is that the gas tax is the only tool that we have right now,” Levin said. “But it’s a time bomb, a time bomb that’s already going off.”
Portland isn’t alone in wrestling with how to pay for its roads. The federal gas tax of 18.4 cents per gallon hasn’t been increased since 1993. Oregon, which has its own 40-cents-per-gallon gas tax, is expected to debate ways to replace dwindling gas tax revenues in Salem next year.
Mapps called PBOT’s financial model “antiquated” and estimated it would be completely useless within the next decade due to the popularity of electric vehicles. He’s eager to discuss new funding models in the future. But he said that renewing the tax is crucial to stave off immediate financial unrest.
“In the meantime, we are basically left with the resources we have,” Mapps said. “We have to be very prudent in terms of how we spend those.”
Mapps said he’s also worried that Portland voters won’t be able to stomach endorsing any tax-related measure this May.
“We have to make the case [for a tax] when every Portlander is feeling beleaguered by rising costs and is feeling a little bit skeptical of funding the government for anything,” he said.
Related: Portland City Council will consider sending gas tax renewal to voters in 2024
In recent years, Portlanders have increasingly identified the local tax burden on individuals and businesses as a source of consternation. This feeling inspired Gov. Tina Kotek to discourage Portland-area governments from introducing any new taxes earlier this year.
The Taxpayers Association of Oregon is the only organization to come out in opposition to the gas tax renewal.
“No gas tax increase until Portland stops wasting our existing tax dollars,” reads a statement issued by the association, printed in the Multnomah County voters pamphlet. The group points to the city wasting public dollars on transportation projects that don’t benefit car travel, like pedestrian bridges and bus lanes.
The tax has the support of the Portland Metro Chamber, the business lobby that’s led the local outcry on tax increases. It’s earned additional endorsements from unions, neighborhood groups, environmental nonprofits, and local politicians like Mayor Ted Wheeler, Metro President Lynn Peterson and Congressman Earl Blumenauer.
The initial gas tax passed in 2016 with 53% of voter support. In 2020, 77% of voters approved its renewal.
Polling data suggests this pattern will continue. A survey conducted for the city last October found that nearly 60% of polled voters would support the renewed tax, despite expressing dissatisfaction with city services overall.
