How Oregon’s transportation proposal affects counties and cities

Oregon lawmakers recently unveiled a proposal to maintain the state’s roads and bridges. House Bill 2025 would raise the state’s gas tax by 15 cents, raise vehicle fees and add oversight to the Oregon Department of Transportation, according to OPB reporting. The bill could raise more than $2 billion annually by 2034, according to a revenue analysis.

What does the proposal mean for cities and counties? Dan Dorran is a Umatilla County Commissioner. Jim McCauley is the legislative director for the League of Oregon Cities. They join us with more on the role that cities and counties play in Oregon’s transportation system and why funding is critical at the local level.

Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.

Geoff Norcross: From the Gert Boyle Studio at OPB, this is Think Out Loud on OPB. I’m Geoff Norcross. Aside from the state budget, the bill that’s drawing the most attention in Salem right now is the transportation package. It proposes a suite of tax and fee increases that could raise more than $2 billion annually by the year 2034. That money would be used in lots of ways, including shoring up roads and bridges across the state.

We wanted to get a sense of the disparate needs of transportation funding across Oregon. Later, we’ll speak with the League of Oregon Cities. But first we get the county view. Dan Dorran is a Umatilla County Commissioner and I spoke with him yesterday.

Norcross: I’m sure you’ve seen the transportation bill that’s now being debated. A big chunk of the money that’s being raised would go to the state highway fund. How does that work in Umatilla County? How do highway funds work in your county? What is actually available to you to use?

Dan Dorran: So just to back up a little bit, Geoff, the majority of the state highway fund, in the past, and even in all of the different legislation that’s being proposed, maintains what they call the 50/30/20. So 50% of that pot of money, which is the majority of the revenue generated, goes to the state, 30% goes to the counties and 20% goes to the cities. For Umatilla County, it all depends on how it’s calculated, but what that means is about a $7 [million] to $8 million budget for our roads.

Now in Umatilla County, we have basically 1,700 miles of road. A little over 300 miles are paved, the rest are gravel. We have over 300 bridges and another 300-plus culverts. All of those are maintained by the county. So we will use the state highway fund for everything from equipment, to gravel, to labor, to everything it takes to maintain and upgrade our road system.

We don’t do capital projects. First of all, we don’t have the money to do it. The state highway fund doesn’t allow us to have that. The funding itself does not put us in a position to do capital projects. If we do those, we have to find other resources, which gets to be extremely tricky at the Umatilla County level because Oregon statutorily can’t use general fund dollars for road projects.

Norcross: I hear you saying that you can’t do capital projects. You can’t build new stuff. You pretty much have to use this $7 [million] to $8 million that you’re getting from the highway fund just to maintain what you already have. Is that a fair characterization?

Dorran: That’s absolutely the truth, yeah. So just make a relative comparison, the state has 900 miles, where we have 1,700 miles in Umatilla County. That doesn’t mean that it’s any less expensive for the state. It is more expensive because they have more responsibilities. They actually snowplow, sand and those types of things 24 hours a day. In the county, we can’t do that because we can’t afford that. We used to back in the ‘80s, but we also had 31 more employees in our road department.

Norcross: Have you had to strand some of your residents because of that inability to plow 24/7?

Dorran: Absolutely. So we do it on a priority basis. It depends on what time of year. If it’s a holiday, then probably not as much. But during the school week, we try to make sure the bus routes are open first and then the most major traveled roads. Next are the more remote areas. Places where maybe one, two or three people are at the end of a 15-mile county road, those people know that they’re not going to be the first to get out. So most of those folks either have snow machines, four-wheel drives or all of the things that it takes to live in those more remote areas.

Norcross: That sounds like a very good lesson in the challenges that you have there in the county. You mentioned you have about 300 bridges. How would you describe the state of those bridges in the county right now?

Dorran: Not good. The federal government, in conjunction with the state of Oregon, comes through, and scores and analyzes all the bridges in the state. When that happens, we’ll know what condition … Some bridges, the state may close until we put a new girder under it. Or it may be a short enough bridge where just another plank or another steel girder is needed to bring it up to certification levels.

Then there’s others. We have bridges that are out right now in Umatilla County. Thorn Hollow Bridge, a very critical bridge, has been out for three-and-a-half years. That is a bridge with complications that some counties have but most don’t. It’s a county road that goes through a tribal reservation and crosses an anadromous river. So [there are] lots of complications on permitting regulations, land use, purchase, right-of-way. Even though we were able to afford the engineering and get that done and the full funding for the bridge has been there for about two-and-a-half to three years, the regulatory issues have really slowed that project down to where it just now went out for contract. And construction is starting this year.

But in the meantime, fire trucks [have a] detour of 40 minutes to get the fires up above. School buses have had the same 40-minute detour for the last two-and-a-half years. If you have a heart attack up there, instead of the ambulance being there in 17 minutes, now it’s 57 minutes. So the reality hits us every day right between the eyes on these bridges that are out.

Norcross: I think I hear you saying, that you have a lot of bridges and just keeping them up is complicated. It’s not just a funding issue. It’s also a regulatory issue. It’s also a jurisdictional issue, and I get all that. And there’s another element to this: inflation, which comes for us all. It’s just more expensive to do something basic like provide services to a county right now. Can you talk about how inflation is affecting the work that you can do on infrastructure right now?

Dorran: Inflation, even though it’s calmed and, in a lot of construction materials, it’s actually starting to look at receding. So that’s good. But inflation has taken us to such a new level that even projects we were doing in September, October of last year ... A real life example is a walking path that we received a grant for two-and-a-half years ago. The original high estimate was $6 million for two miles. So we’re paying $3 million a mile for a walking path. So inflation actually drove that to $19 million today, for the same two miles. So we’re basically spending, in the state of Oregon, because of regulations, because of inflation, because of statutory requirements, $10 million a mile for a walking path. So it has a real life effect on what and how much gets done every day in this county.

Norcross: Almost exactly a year ago, a group of lawmakers who were in charge of creating this transportation bill went on a kind of road trip to talk to county leaders about their needs and concerns. You were one of those leaders. And I’m wondering if you feel like you have been heard, as this bill came together?

Dorran: Absolutely. That’s the one thing I do have to say. I testified last Thursday night and the comment I made was, we have a lot of these different philosophical, ideological, political issues all being discussed. The problem is they have now hit a chaotic crossroads with reality and economics. And the one thing that I appreciate a lot is, no matter how they are looking at funding, there isn’t anybody in the legislature, especially the folks that participated in the roadshow, the Joint Transportation Committee, that doesn’t understand our needs. It doesn’t mean that they are having a smooth path to funding those needs. But I truly believe that they do understand rural, county and city needs because of that listening tour.

But not just because of that. Also, we have very vocal county and city folks that have spent a lot of time down in Salem this year talking about individual specific issues, along with holistic issues, whether it be opening sand and gravel pits, how wide a fog line should be, or can you even afford a fog line. Those discussions have happened with almost every legislator in the Senate and the House. I’m not sure that they’re tired of hearing from us, but I know that they’ve heard us loud and clear, that [in] the counties and the cities, rural and urban, the need is extremely real.

I can guarantee you not one of my constituents is afraid to pick up the phone and call me. Our phones 5-to-1 are road issue, bridge issue, transportation issue. My phone rings constantly because of that. And when you tell them it’s a funding issue, that doesn’t go very far with constituents. They just want solutions.

Norcross: I’m sure. Dan Dorran, thank you so much for the time and best of luck to you.

Dorran: Thank you very much. Thanks for your time.

Norcross: Dan Dorran is a Umatilla County Commissioner and we spoke yesterday about what the massive transportation package being debated at the state capitol might mean for the needs of his residents.

Let’s get to the city perspective next. Jim McCauley is the legislative director of the League of Oregon Cities, and he joins us on the line. Jim McCauley, welcome to Think Out Loud.

First, talk to me a little bit about the League of Oregon Cities. Can you tell me who is in it when it comes to the diversity of city size and geographic diversity?

Jim McCauley: Every city in Oregon is part of the League membership base. So that’s 241 cities across the state, from the largest, with the city of Portland, to the smallest of Greenhorn.

Norcross: So definitely a diverse group there. You were actually part of that transportation bill roadshow, as we’ve been calling it, where you went out to municipalities around the state to talk about people’s concerns when this bill was coming together. What kind of things did you hear out there?

McCauley: It was a pretty consistent message. So I’ve had a chance to work on the last three transportation packages over 25 years. So 13 different tour stops across Oregon, throughout the summer and the fall, [and a] pretty consistent message from the folks who had a chance to provide some input, elected officials, also other leaders, business leaders and members of the public. Pretty consistently, everybody we heard from wanted to see additional investment in their roads, their neighborhood streets. They wanted to see public transit invested in. They wanted to see things like bike and pedestrian safety prioritized. And they really wanted to see something more of a core kind of back-to-the-basics type of infrastructure investment.

Norcross: Dan Dorran mentioned the 50/30/20 percent allocation of state highway fund dollars. Cities get the low end. They get 20%. Is that adequate to cities’ needs?

McCauley: I don’t know if there is an adequate formula out there that would satisfy all of the road miles. One thing that Commissioner Dorran mentioned is the vast majority of the road miles that are out there, local governments are responsible for. We have local measures that are in place to help with some of that funding, [like] gas taxes. But that’s not across every city or county. There are some registration fee increases that some of the larger counties have got in place to help supplement some of those transportation elements. But even with that 20%, it still is a core part of how those local streets are funded. And for some communities it is their only transportation funding that’s available. Not a lot of cities out there have the ability to go out and raise the gas tax. It’s not a very popular thing. In fact, the last few election cycles, there hasn’t been a local gas tax, even at a penny or 2 cents, that has satisfied voter support. So many of them are very dependent upon that funding coming back from that state share.

Norcross: We just heard about a number of transportation challenges in the counties, especially in rural ones. How are the issues in the cities the same and how are they different?

McCauley: There are a lot of similarities. We have the same type of challenges with bridge maintenance. We have the same challenges with street conditions. We do survey work every few years with our members. The last survey that was done in 2024 showed that about 40% of the street miles are in poor or very poor condition, which again, I think is the part of that driving message that we had made over the last couple of years building up to this transportation package. More investment is needed.

So I think some of the differences that you’ll find are the county roads have different amounts of driving concentration or how many vehicles there are on the roads. City streets are totally different. You have your highest population centers and a higher level of frequency of drivers, so they’re very difficult to maintain.

Norcross: How do you feel about the funding levels in the transportation bill that’s being debated right now? It hasn’t been enacted. We don’t know what it’s going to be ultimately. But based on what you’re seeing, do you think it’s sufficient?

McCauley: It’s hard to answer whether or not it’s sufficient. What I can offer is that it really is going to be a significant increase over what’s currently shared with the state. And I think the significance really comes down to, currently, just the city apportionment statewide at about $238 million. That is a proportional share by population. By the time full implementation takes place with this package, we’ll be at around $230 million. So effectively, about five to six years out, we’re going to see almost a doubling of the current investment. That is significant and something that I think is going to be noticeable in the communities.

I think we can make the case that every single city is going to see improvements made to their streets. It could be curbs. It could be just some of the surface work that’s done, certainly potholes and some of those other deferred maintenance types of things that that cities face because they just don’t have enough budget dollars. But I can definitely guarantee you that every single neighborhood and every single city out there is going to see some type of improvement over time.

Norcross: Given that the need is so great though, for just basic repair and maintenance, do you think the structure of the way Oregon raises and spends money on transportation needs should be changed?

McCauley: It’s a great question. We’ve had these types of conversations internally, wondering if we should flip the formula, where local governments should get more. But I think part of the balance we understand is that those state facilities, the state highways, are much more expensive to maintain. They’re much more expensive to build. We’ve had this 50/30/20 balance for a number of years. It’s worked out OK.

I think the biggest change for listeners to understand is that historically, the vast majority of the new revenue that was raised from gas taxes or registration fees went to major projects. It didn’t go to the local government share. This time around, this transportation package basically flips that. The vast majority of that new transportation revenue that’s coming forward is going to go to operations and maintenance at the state level. And it’s something that cities and counties are going to be able to take advantage of, to not just deal with some of their deferred maintenance, but possibly help leverage some of those capital projects.

Norcross: I’m just curious, how does the state decide how much money goes to each city, each of the 241 cities? Is it by population?

McCauley: Great question. So yeah, the city distribution formula is by population. The county distribution is by vehicle registration. And then ultimately, there’s another fund that’s out there, not huge, but nevertheless incredibly important. So two-thirds of our membership are less than 5,000 in population. And by the time you get down to that level, it’s not a huge amount of money for them to put into a capital project as an example. In all likelihood, it’s really just going to operations and maintenance, and keeping the streets at some level of, I’ll just say, drivability.

So we have a small city allotment out there, a program of $5 million. It’s going to grow by an additional $1 million. That’s a competitive grant program that allows for $250,000 grants to go out there. That has been a lifesaver for an awful lot of small communities that have taken advantage of that grant program. And we definitely need more of that in the long term.

Norcross: I just want to take a step back here at the end. I’m inspired by what Commissioner Dorran said, that he gets way more calls to his office over roads than any other issue, by a ratio of 5-to-1. We’re having big conversations about the role of government and what it should do just to make our lives better. But this is a very basic thing, isn’t it, just to make sure that the roads that we’re driving on and the bridges that we’re driving over are safe, and we don’t need to think about them. I mean, isn’t this what government is for?

McCauley: Yeah, I think this is part of that core service delivery, whether you’re a county or a city. And I would imagine that the mayors and councilors that are out there have the same type of conversations, whether it’s on the phone, in the grocery store or simply walking down the street. The public wants to see a safe place to drive, a safe place to walk. They want to have transportation options. And this package, from our view, provides all of those things. And it provides a very significant increase in what that local investment is gonna look like long term.

Norcross: Jim McCauley, thank you so much for this.

McCauley: Appreciate it. Thanks very much for allowing me.

Norcross: Jim McCauley is the legislative director of the Oregon League of Cities. We earlier spoke with Dan Dorran, commissioner for Umatilla County.

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