Fuel tax would be considered alongside low-carbon fuel standard program

SPOKESMAN PHOTO: VERN UYETAKE - Rep. John Davis, R-Wilsonville, proposes implementing a 4 cent fuel tax across Oregon, and a 6 cent fuel tax in Portland. Seeking to strike a balance between the conflicting demands of legislators that doomed a $343.5 million transportation package in the 2015 Oregon legislature, Rep. John Davis, R-Wilsonville, unveiled the first draft of a proposal last month that would utilize a gas tax, bonds and driver fees to raise funds while repealing part of the controversial low-carbon fuel standard program.

Davis’ transportation package would use bonding to generate around $120 million for transportation-related projects. Those funds could make the state eligible for the federal government’s Fixing America’s Surface Transportation (FAST) Act, which could match that $120 million with up to $180 million.

Other elements of Davis’ proposal include a statewide 4 cent gas tax increase, which he says would generate $133 million. Portland fuel sales would see 2 more cents added to that tax to create another $7.3 million in revenue to be used toward “congestion relief” in the Metro area.

Davis also proposes to raise transportation funds by increasing the cost of automobile registration fees from $43 to $55, which he says would generate $44 million; title fees from $77 to $125, which would generate $28 million; and registration for electric vehicles from $43 to $200 per year, which would generate $1.3 million.

As a part of the package, Davis proposes the elimination of a credit-trading system that is part of the state’s low-carbon fuel standard program, which took effect at the beginning of this year after being extended by the 2015 legislature. The program was a major point of contention during the 2015 legislative session, when predominantly Republican legislators refused to support both the program and a gas tax — which helped to stop a proposed $343.5 million transportation package from passing.

The low-carbon fuel standard program is intended to force large fuel importers to reduce their fuels’ emissions by 10 percent by 2025, a requirement that Davis says would remain in place under his proposal. The credit-trading program would require fuel producers who cannot or will not reduce “carbon intensities” — the total carbon footprint involved in producing, transporting and burning a fuel — to purchase credits from other companies who are taking steps to reduce their carbon intensities.

Davis says that the credit-trading program is one of the most expensive parts of the low-carbon fuel standard. Critics have said that the expense involved in the low-carbon fuel standard program would put an undue burden on Oregonians living in rural areas.

Studies cited by the Oregon Department of Environmental Quality estimated that the program would increase the cost of fuel by between 4 and 19 cents per gallon, although those studies were conducted by organizations that favor legislation like the fuel standard. A group that opposes the legislation estimates a price increase of $1 per gallon or more.

Davis proposes to continue to require carbon intensity reductions to a degree determined by an annual study conducted by the Department of Agriculture, which regulates Oregon’s fuel standards. Those reductions would largely be accomplished by blending biofuels into gasoline and diesel.

Davis’ package would also require the Oregon Department of Transportation to cut $50 million in operating expenses per year, and those funds used for bridge and highway maintenance and restoration. ODOT would also be asked to share space with county and city administrations to reduce costs, and an independent audit of the organization would be commissioned to evaluate its decision-making processes and efficiency.

It is unlikely that legislators will consider passing Davis’ entire proposal during the 35-day legislative session that began Feb. 1, with legislators having indicated that the 2017 session might be a more appropriate time to consider a package. However, elements of the package may be considered in the weeks to come.

Contact Jake Bartman at 503-636-1281 ext. 113 or This email address is being protected from spambots. You need JavaScript enabled to view it..

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