Decision 2026: Measure 120 gives Oregonians a chance to weigh in on gas tax, vehicle fee hikes

By Mia Maldonado, Oregon Capital Chronicle

SALEM, Ore. -- Voters soon will have a say in what’s been one of Oregon’s most contentious issues over the past year: funding state transportation needs. 

Measure 120 will let voters approve or reject a law Democratic lawmakers passed and Gov. Tina Kotek signed in 2025 that raises the gas tax and other transportation fees mostly to raise revenue for the State Highway Fund, which the Oregon Department of Transportation uses to fund road maintenance and splits with counties and cities. 

The question of how to fund road maintenance and operations in Oregon has been at the forefront of legislative decisions for the past two legislative sessions. As more people in Oregon switch to electric or fuel-efficient vehicles and no longer pay as much in gas tax, the state isn’t bringing in enough money to fix the wear and tear on its roads. At the same time, inflation has increased the cost of materials needed to fix transportation infrastructure.

But gas tax hikes in Oregon, even when meant to fund the roads drivers rely on every day, are widely unpopular. Oregon voters since 1928 have shot down at least six attempts to increase the gas tax, state records show. 

Measure 120 isn’t likely to be an exception. Republicans last year, frustrated by the cost of living and tax hikes, petitioned that parts of the law be placed on the ballot. Seven arguments have been submitted in favor of the measure while 28 have been filed against it, according to an early online version of the state-issued voters’ pamphlet prepared for military and overseas voters.

‘Yes’ or ‘No’ on Measure 120

A “yes” vote on the measure would support increasing the gas tax from 40 cents to 46 cents, raising title fees from $77 to $216 and increasing most vehicle registration fees.

Those registration fee hikes would mean passenger vehicle registration going from $86 every two years to $170, motorcycle registrations increasing from $88 every two years to $172 and low-speed and medium-speed vehicle registration increasing from $126 every two years to $210. Registration fees for passenger vehicles also have a surcharge based on fuel efficiency, with most drivers paying another $40 or $50 every two years. Those surcharges weren’t included in the bill. 

A “yes” vote would also support doubling the payroll tax used to fund public transit services from 0.1% of a paycheck to 0.2% of a paycheck until January 2028. For the average Oregonian making $68,000 a year currently paying $68 a year, a majority “yes” vote would raise that tax to $136. 

A “no” vote means rejecting those tax and fee hikes, essentially asking the Oregon Legislature to come up with a new way to fund road maintenance.

A rewind to 2025: How we got here

While Republicans wanted to avoid tax hikes and pushed for repurposing funding the transportation department already had, Democrats pushed for tax and fee hikes in the 2025 legislative session. Lawmakers ultimately failed to come up with a compromise for a transportation package, resulting in nearly 500 ODOT workers receiving layoff notices from the agency so it could redirect their salaries toward road maintenance.

Kotek in response called for a special session, delaying layoffs and forcing lawmakers back to Salem in the fall to find a solution. Democratic lawmakers during that special session secured the votes to pass a watered-down transportation package that would raise $4.3 billion for the transportation department over the next decade, despite receiving no Republican support. 

In late 2025, gubernatorial candidate and Scio Republican Ed Diehl, Senate Minority Leader Bruce Starr, R-Dundee and Taxpayer Association of Oregon founder Jason Williams led the campaign petitioning for the law’s placement on the ballot, turning in more than 200,000 signatures to the Oregon Secretary of State’s office — more than double the 78,000 signatures they needed to secure a spot on the ballot. 

The group’s political committee, the Right to Vote on the Gas Tax PAC, has raised more than $166,000 for the campaign, spending nearly $150,000, according to campaign finance filings on the Oregon Secretary of State’s website. There are no political committees actively supporting Measure 120, records show.

The vote was originally scheduled to take place in November, but during the 2026 legislative session, most Democratic lawmakers voted to move the day of the vote to May 19, saying an earlier vote would give them the clarity they need to find a long-term budget solution. 

The move triggered Republican walkouts during the session and at least four lawsuits trying to keep the date of the vote in November. Republicans characterized it as an attempt to ignore the will of nearly a quarter million voters who signed the petition against the gas tax and an attempt to ensure the unpopular measure wasn’t on the same ballot as Kotek and Democratic lawmakers.

The legal disputes over the day of the vote quickly failed in court, and the vote will still appear on the ballot for Oregon voters in May.