Oregon Democrats face voter revolt over gas tax hike on May ballot

Democrats sold Oregon motorists a harder bargain last fall: pay more at the pump and in vehicle fees so roads, bridges and transit can keep moving. Now that deal is heading to voters, and it is arriving just as gasoline costs have surged and the political case for affordability has become central to the midterms.

Gov. Tina Kotek signed House Bill 3991 on Nov. 7, 2025, as emergency funding for the state’s transportation system. The law raised Oregon’s gas tax from 40 cents to 46 cents a gallon, temporarily doubled the statewide transit payroll tax from 0.1% to 0.2%, and increased certain vehicle registration and title fees. Most of those changes are delayed until after a statewide vote, but the measure still has already become a referendum on whether taxpayers believe the state’s pitch.

The ballot fight emerged after Republicans gathered enough signatures to force the question onto Oregon’s May 19, 2026, primary ballot. The petition needed about 78,000 valid signatures; supporters said they collected more than 250,000, a sign of how quickly the repeal campaign gained momentum. Oregon officials later said the measure qualified for the ballot.

The stakes are steep for the Oregon Department of Transportation, which says the system relies heavily on gas taxes and vehicle and freight fees. As more drivers switch to fuel-efficient and electric vehicles, gas-tax revenue has flattened. Inflation has compounded the problem, and state transportation officials have warned that without new money, service cuts and layoffs would be likely. Before the emergency package passed, roughly 480 ODOT workers received layoff notices in July 2025.

Kotek’s office said the package was meant to keep highways and local roads open, preserve transit service and stop pending layoffs. The governor cited support from cities, counties, workers, truckers, businesses and AAA. But the politics changed sharply once the cost showed up in a year when national Democrats are trying to present themselves as protectors of working families and guardians of household budgets.

The timing has made the fight even more combustible. AAA Oregon/Idaho said the national average gasoline price reached $4.522 on May 10, 2026, while Oregon’s average stood at $5.324, about 80 cents higher. AAA said the national average topped $4 and Oregon reached $5 a gallon in early April, with later price spikes tied to disruptions linked to the Iran conflict. Portland driver Jeanine Holly called it “a terrible time to raise gas taxes.”

That is the contradiction Oregon Democrats now face: they argued that higher transportation taxes were necessary to avoid a worse breakdown in roads and transit, but voters will judge the promise against visible pain at the pump. In a state where the average vehicle already paid about $294 a year in state and local vehicle taxes and fees before HB 3991, the question is whether infrastructure funding still looks like an investment or just another bill.