Problem Solvers: Gov. Kotek slams lawmakers after transportation bill fails, hundreds of ODOT layoffs announced

BEND, Ore. (KTVZ)-- The legislative session officially ended Friday, and transportation funding failed to pass.

Democrats presented the package just last month, sending legislators across the aisle into a frenzy to ensure funding could be passed. Without that funding, the Oregon Department of Transportation says up to 1,000 jobs could be cut. 

However, bipartisan support could not be achieved, and legislators went home two days early.

Governor Tina Kotek has slammed the Legislature for not working to pass a package by Sunday, the legal last day of the session. At a press conference Saturday, she said, "I'm going to point out again, I'm here. Constitutional sine die is tomorrow. And legislators have gone home, and they have not produced anything on transportation that we need right now in the state."

The Problem Solvers spoke with state Representative Emerson Levy, D-Bend, on Tuesday. She says if the funding did pass, ODOT wouldn't have seen it for another year.

"The money would not have been realized until a year from now, so I'm not sure about the budget discrepancy that happened between Friday and July 1st, and I'm certainly open to hearing about it. But there would have been no money deposited between those times," Levy said.

ODOT told the Problem Solvers in a statement that the department had been warning legislators for years about ongoing funding issues.

"ODOT cannot use federal funding for maintenance. State law prevents the agency from using project or transit money to pay for maintenance or agency operations," the agency told KTVZ in a statement. "ODOT has taken voluntary reductions over the past six years, and no further reductions are available that won’t have consequences for Oregonians."

The original transportation package was presented around a month ago and would have increased the state's 40-cent gas tax by 15 cents.

Levy says the tax increases would have had devastating impacts on Oregonians. "The first package I couldn't support - it was too much for working families. And I know what it's like to get a big bill that you can't pay."

Lawmakers tried to pass a smaller bill Friday night, but also failed.

Locally, Cascade East Transit says it's not currently affected, but added that if legislators continue to fail at passing funding, they could see impacts. 

The package would have increased the payroll tax from .1 to .3 percent, which CET says would have allowed an increase in services in Bend.

Levy said, "I know it's not what people wanted, and it's really not what I wanted. But again, I think a pause is the correct move."

ODOT has been under fire by legislators earlier this year, after the department's revenue came up $1 billion short. In an audit, ODOT told lawmakers the department's system did not estimate correctly how much revenue they would receive in 2023-2024.

Below is a statement from ODOT about the layoffs:

For many years, ODOT has informed the Oregon Legislature that a structural revenue issue driven by flattening and declining gas tax revenue, inflation, and statutory restrictions on available funding would eventually force the agency to dramatically reduce its staffing and maintenance service levels if no intervention came forward. For the last three biennia, ODOT has taken progressively larger voluntary cuts to stay within budget.

Since last summer, ODOT has broadly shared that if the legislature did not address this shortfall during this legislative session, deeper cuts would have to start in the 2025-27 biennium.  

On Friday night, the legislature ended the session without passing a transportation package providing ODOT with either new funding, funding flexibility, or even an interim investment to stabilize services for the immediate upcoming biennium. As a result, ODOT will have to make deep and painful cuts starting in the next few weeks. 

ODOT cannot use federal funding for maintenance. State law prevents the agency from using project or transit money to pay for maintenance or agency operations. ODOT has taken voluntary reductions over the past six years, and no further reductions are available that won’t have consequences for Oregonians. The only way to balance the budget and live within available funding is to make deep and severe cuts. These cuts will harm Oregon’s transportation system, Oregon’s travelers, and the operational health of the agency. 

This week, ODOT will begin the layoff process. By the end of July, hundreds of positions will no longer be at ODOT. The agency is using vacancy savings wherever possible in order to minimize the number of layoffs but will still lose hundreds of current, hard-working employees. 

ODOT cannot solve this structural revenue issue on its own, and it won’t fix itself. Each year that passes, the vehicle fleet grows more efficient and uses less gas per mile driven. And with each year, the cost of doing business gets a little higher with inflation, while revenue sources stay flat. The only way out of this problem is for the legislature to dedicate additional funding to maintenance and agency operations or provide greater flexibility in how funds are spent.   

Oregon’s travelers will soon experience a less reliable transportation system. ODOT staff dedicated their professional lives to this agency and to supporting the traveling public. We will continue to do the best we can, with the resources we have, to keep Oregonians safe.