Plan includes tolls, bike tax
SALEM — Oregon state lawmakers unveiled out a massive 10-year transportation package this week that would raise $8.2 billion from Oregonians through new taxes and fees when they visit gas stations, buy new cars and get their paychecks.
Local commuters could also pay tolls for the first time when driving on certain highways. And Oregonians who prefer more eco-friendly methods of getting around could pay a bit more when registering their fuel-efficient cars that get more than 40 miles per gallon, which would see higher fee increases than regular vehicles, or even when buying a new bicycle.
Bipartisan lawmakers say these higher costs, which would begin in 2018, will help pay for seismic upgrades and repairs to ailing roads and bridges, ease traffic congestion in problem areas — especially Portland — and expand infrastructures for pedestrians and bicyclists.
The package was unveiled Monday and will be used as a framework for drafting an official proposal by the bipartisan Joint Transportation Preservation and Modernization Committee, which is hosting a series of public hearings over the next several weeks.
The idea is to gradually phase-in the higher taxes and fees over several years, although some consumers would feel the impact immediately.
Beginning in 2018, a 1 percent excise tax would be levied on new car purchases, then go up to 2 percent by 2022. Vehicle title and registration fees would jump by $20 next year and $60 for fuel-efficient cars, with $5 increases every two years through 2026. Gasoline taxes would increase by 6 cents a gallon, also followed by 2 cent biannual increases through 2026.
Additional hikes next year include a 0.1 percent payroll tax that, unlike income taxes filed annually during tax season, would be taken directly out of workers' paychecks. There would also be a 4 percent excise tax — a cost that businesses often pass onto consumers by building it into the retail price — on bicycles sales.
Scott's Cycle, a small bike shop down the street from the state Capitol in Salem, would be hit by the payroll and bicycle taxes, said Steve Lewis, a shop manager.
"It's unfortunate but, it is what it is, and I guess we have to deal with it," Lewis said. "It's more paperwork, it's another step of paying taxes ... (the bike tax idea) has kind of been pushed around for years so it's something I wouldn't say we were surprised about, but we definitely don't like it."
The store sells about 800 bicycles a year at an average of $1,000 each. A 4 percent bike tax would tack on about $40 extra on average — netting the state $32,000 total for the year.
"As we have said in the past, we are running the most transparent transportation process I think this building has ever seen, so now it's time for public input," Democratic House Speaker Tina Kotek told reporters Monday. "We still have plenty of time to work out the details, but this is an important turning point in terms of actually having specifics out there for people to respond to."