Oregon voters have successfully paused a new law that aimed to increase gas taxes and registration fees intended to fund road maintenance and counteract revenue losses linked to the rising popularity of electric vehicles. This decision was made after a significant grassroots mobilization led by Republican legislators, culminating in approximately 250,000 Oregonians signing a referendum petition that will place the proposed tax and fee increases on the ballot for a vote in November 2026.
The controversial law, House Bill 3991, was signed by Governor Tina Kotek in November 2025 following a special legislative session. It proposed raising the state gas tax by six cents, increasing it to a total of 46 cents per gallon, alongside hikes in registration fees for select vehicles and title fees overall. While some provisions of the bill came into effect immediately, such as an increase in annual registration fees for electric vehicles from $115 in 2025 to $145 in 2026, voters’ opposition halted the implementation of the gas tax and other fee increases.
Oregon State Representative Ed Diehl and State Senator Bruce Starr spearheaded the referendum movement, which utilized the state’s direct democracy procedures allowing voters to challenge recent legislation via petition drives. In a statement regarding the success of the movement, Senator Starr praised the collective efforts of Oregonians for their commitment to ensuring that voters’ voices are heard, stating, “They are nothing short of amazing.”
Under the proposed law, the structure of vehicle registration fees aimed to adapt based on fuel efficiency, with less efficient vehicles facing lower fees, while more efficient and hybrid models would bear higher costs. The increases would have raised the annual registration fee for vehicles with a combined rating of 40 mpg or higher to $65, up from $35, as part of an initiative to ensure equitable contributions across vehicle ownership. This approach was intended to address the diminishing gas tax revenue that has been attributed to the growing number of electric vehicles and improving fuel economy among conventional vehicles.
Oregon’s Department of Transportation (ODOT) has voiced concerns about the financial implications of the halted legislation, highlighting a potential funding gap that could result in severe budget cuts, including layoffs of over 400 employees and the closure of various road maintenance stations unless new funding sources are identified. With a budget deficit estimated at $242 million for 2026, the pause on these funding measures puts increasing pressure on the already strained transportation infrastructure.
Governor Kotek has called for a reconsideration of the emergency transportation bill in light of these developments, emphasizing the necessity of making difficult choices to ensure the future stability of the state’s transportation system. The outcome of the upcoming vote in November 2026 will be pivotal for Oregonians, as it holds significant implications for road safety and affordability in vehicle licensing.
As Oregonians await the decision, the pause serves as a reminder of the power of direct democracy in shaping state policies, with hopes that sustainable solutions can be found that balance the needs of both residents and the transportation infrastructure.