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NEWS UPDATE FOR STATE REPRESENTATIVE DAVID GOMBERG: Three Pieces of Policy and Economic News

Posted on September 8, 2025 by Editor

By Representative David Gomberg, House District 10

9/8/2025
Dear Friends and Neighbors,

The Special Session called by Governor Kotek to address transportation funding shortfalls was scheduled over the Labor Day Weekend when most legislators were available.

The special committee completed two public hearings, adopted compromise amendments, and sent the package to the House, where it was approved. Two coastal legislators, a Democrat and a Republican, voted in favor, one voted against, and one was not present. The measure then advanced to the Senate, where it encountered an unexpected delay.

Things looked on track to go smoothly in the Senate, with a vote on the package and a related budget bill planned for Wednesday morning. That result depended on all Democrats and two Republicans being present. However, on Monday, it was announced that Senator Chris Gorsek is recovering from health complications. Legislative proceedings in the Senate are set to resume on September 17th.

I wish Senator Gorsek a smooth recovery.

Without around $300 million more in its current two-year budget, the Oregon Department of Transportation plans to lay off nearly 10% of its workforce and reduce services throughout the state. Those layoffs were slated to take effect September 15, after the point lawmakers are now expected to take up the funding package. But Governor Kotek announced Tuesday she would push back the potential layoffs until October 15, saying she has assurances from Senate leaders the bill will pass once Gorsek returns.

 

 

As presiding officer, I was asked several times to announce delays in floor sessions.

I have written in detail about the evolution and contents of the Transportation Package. The bills do several things, including:

Revenue

  • Gas Tax: increases the gas tax from $0.40 to $0.46 per gallon, beginning in 2026.
  • Electric Vehicles: requires electric vehicle and hybrid vehicle owners to pay a per-mile rate or a flat fee, beginning in 2027 for EVs and 2028 for hybrids.
  • Registration Fees: raises registration fees $42 per year.
  • Privilege Tax: does not include a new sales tax on cars or tires.
  • Taxes for Transit: increases the payroll tax by one-tenth of one percent and eliminates that increase after 2 years.

Investments

  • Maintains road safety services like striping and potholes.
  • Keeps snowplows operational in the winter.
  • Allows timely accident response.
  • Sends half the revenue to city and county transportation services and road maintenance.

Accountability

  • Gives the governor the power to hire and fire the director of the Oregon Department of Transportation.
  • Requires performance audits of ODOT by the Secretary of State.
  • Strengthens legislative oversight of ODOT.
  • Prevents state agencies from increasing transportation taxes without asking the Legislature first.

I don’t like tax increases, and I well understand that too many of our neighbors struggle to pay for groceries, face unaffordable utility rate increases, and can’t find affordable housing. I also understand that our economy and increasingly our lives depend on safe and drivable roads. On Highway 20 alone, eight people have died between Newport and Philomath so far this year.

I know that this vote isn’t popular with everyone, and as the House debated the bill, some lawmakers were already warning about how they intended to use it as an attack in the next election. That’s politics. I’ve been more than willing to break with my party when I think they’re wrong. But I’m also not afraid to take a hard vote when it’s the responsible thing to do.

Early this year, I questioned a larger package that asked too much of taxpayers. I pushed for changes. We made important adjustments to the bill, even in the final days, to make it more bipartisan and fairer to taxpayers.

What I ultimately voted for is one-third the size of that original proposal. It took months of negotiation and compromise, but what we approved is a narrow, targeted fix. It keeps our roads safe and maintained. It includes overdue accountability and transparency reforms, including a full audit of ODOT. And half of the money raised by the bill will go straight to cities and counties, for local leaders to spend on their communities’ transportation needs.

That means millions of dollars for Newport, Philomath, Waldport, Lincoln City and Lincoln, Benton, and Lane Counties.

There were, of course, plenty of alternative proposals to find the money.

I heard much about wasteful or unproductive spending in other state agencies. And I don’t disagree! We can and should do better. But I also believe roads should be paid for by people driving those roads and not with reductions to housing, health care, fire response, or schools. I hear suggestions to divert emergency reserves. But that $100 million in one-time funding would not solve a $350 million ongoing funding gap we need to address in our State Highway Fund. I even heard inflated proposals to rent out space in the ODOT building.

There are millions in state highway fund dollars committed to other programs that could go to operations and maintenance. Add them up, and it looks like Oregon could pretty much avoid new taxes and fees to solve ODOT’s operations and maintenance gap. But those aren’t particularly good options, according to a thoughtful editorial in the Bend Bulletin.

What we voted on was the most responsible, least costly, workable solution.

Failing to pass the transportation package would mean drastic cuts to basic safety and maintenance of our roads and bridges. Rural communities need those roads to get our kids to school, to drive to work, or to get an ambulance when God-forbid, we face an emergency. ODOT would need to lay off hundreds of workers and close maintenance stations, cuts we can’t afford with wildfires looming and winter snows around the corner. For all increases proposed, this bill asks the typical driver to chip in about $5.50 more a month to make sure that doesn’t happen.

Going forward, I’ll be focused on making sure the Legislature effectively uses its new oversight powers to reform how ODOT does business, that your tax dollars are being put to use in our community to make our streets safer and less congested, and continuing the conversation about how we fund Oregon’s transportation needs over the long-term without asking more of working people or hurting local businesses. I hope you’ll stay engaged and help me with that work.

The difficulties and differences on display in Salem last week fermented another significant political story that played out in our neighboring district. Representative Cyrus Javadi from Tillamook and the North Coast announced he was changing parties from Republican to Democrat.

This is far from the first time an Oregon elected official has switched parties. Former Oregon State Treasurer Ben Westlund, who died in 2010, started his career in the Oregon Legislature as a Republican and switched to become an independent, then a Democrat. Current state Representative Kevin Mannix, R-Salem, served in the House as a Democrat from 1989 to 1996 before switching parties. And before running for governor against Governor Tina Kotek as a nonaffiliated candidate, Betsy Johnson, also from the North Coast, has been a registered Republican and a Democrat.

Being an elected official has never been about party loyalty, Javadi said in a statement. He said lawmaking is about supporting his constituents and constitutional rights such as freedom of speech, the rule of law and treating people fairly and with respect. I found his statement sincere and illuminating. I encourage you to read it here.

“By the end of the long session in June, my patience had worn thin. Every priority for Oregon’s North Coast, nearly every single one, ran into opposition from my own party. Protecting Medicaid benefits for the nearly 60% of children in Tillamook and Clatsop counties? Opposed. Keeping rural hospitals afloat? Opposed. Preserving students’ access to books that reflect who they are? Opposed. Protecting the First Amendment rights of people different from ourselves? Opposed.”

“Too many extreme politicians in today’s Republican Party have abandoned these values, which is why I made the decision to join the Democratic Party,” Javadi said. “I’m not leaving my principles, just aligning with people who still share them, still show up to govern, and are more interested in bipartisan solutions than obstruction. My loyalty is first and foremost to the people of my district and I won’t waver from my values in order to fit into a partisan mold.”

“Most of the Republicans I know, my neighbors, my friends, many of my constituents, want good things. They want decent jobs, safe streets, a fair shot for their kids. But increasingly, the institutional Republican Party wants something else.” “For months now, the Republican Party’s message has been simple: we don’t care what the problem is, just vote no, or else.”

I am not an overtly partisan legislator. I share these words from a former Republican legislator not to be critical of the other party, but because I believe they help you better understand the challenges that centrists face in Salem.

To be clear, I work well with Republicans in the Oregon House. We coordinate on projects and policies. And as I often note, most legislation in Oregon passes with both Republican and Democratic votes. Much of it is actually unanimous. But at the same time, partisan divides have grown deeper and wider here in Oregon and elsewhere. Certainly, I’m not privy to the debates and pressures that may land on moderates in the Republican caucus. But there have been times I have disagreed with the leadership in my own party, and I still have the scars to show for it…

Many parts of the Coast and Coast Range are less red or blue, but purple. That sometimes makes legislating more challenging. More often, it makes it more rewarding.

Like Representative Javadi, my first loyalty is to the people I represent. I look forward to working with him in his evolving role.

Here is one last piece of political and economic news this week.

The most recent quarterly forecast, presented by state economist Carl Riccadonna to the Senate and House Revenue Committees, illustrated the continuing effect of tariffs and immigration enforcement on Oregon businesses and the new impact of federal tax reforms.

Oregon’s unemployment rate rose to 5% in July, marking the state’s highest rate of joblessness since the COVID-19 pandemic. The Oregon Employment Department announced the figures in mid-August, noting that the state lost 2,700 jobs in July and 24,600 jobs total since the state logged last year’s July 2024 unemployment rate of 4.2%.

The most recent numbers compounded with a recorded loss of 8,600 jobs in June 2025, part of a year of losses that has hit areas such as Portland and coastal and central Oregon the hardest. Here at the Coast, that means people spending less when they visit, and fewer workers from the immigrant community to serve meals, make beds, or process our fish harvests.

So fewer people are working. But at the same time, people who are working are being taxed less.

President Donald Trump’s signature tax- and budget-cutting legislation is likely to cut nearly $1 billion from Oregon’s revenue collections during the current 2025-27 budget cycle.

Oregon is particularly vulnerable to federal tax cuts because we have no sales tax and instead rely on income taxes. Our state income tax system is closely linked to the federal one. The state uses federal taxable income, which accounts for federal exemptions and deductions, to determine the starting point for the amount that businesses or individuals owe. That includes excluding tips and overtime from taxes.

The tax changes in the federal bill are likely to benefit taxpayers in every income group, but they are expected to disproportionately favor wealthy Americans, according to a report from the Annenberg Public Policy Center at the University of Pennsylvania.

Facing major uncertainty over federal policies, Oregon lawmakers set aside nearly $500 million in reserves when they passed a budget in June. It was money meant to offer stability amid economic turbulence. That $473 million cushion could become a $373 million hole in the freshly passed budget, state economists told lawmakers Wednesday morning.

The state also expects to lose out on nearly $15 billion in federal funding in coming years because of changes made in the federal bill.

Chris Allanach, the state’s Legislative Revenue Officer, said in July that Oregon has three possible responses to the projected shortfall. Lawmakers could cut budgets, find a way to bring in more revenue or tap reserve funds. Or they could move to disconnect from the new pieces of the federal tax code. That would close the budget hole, but it would eliminate new tax cuts and effectively raise Oregonians’ tax bills back to the current level.

 

As anticipated revenue continues to decline, we will likely have to adjust budgets adopted earlier in 2025. That work may be the focus of the short 2026 session. Or it may require another special session. Either way, it will certainly affect the taxes you pay and the services you receive.

Your state capitol continues to be largely closed and mostly under construction. The House Chamber was unavailable last week, forcing the House to convene in the Senate Chamber for the first time in anyone’s memory.

This important seismic and expansion work has been going on for years. When we convened in January, I read some of the inscriptions from the rotunda as part of the opening ceremonies. Most of the elected members had never seen them. One of the best lines I heard last week was that, in a billion years, the sun will burn out. And that will be a problem because the Capitol renovations will have to continue in the dark…

The sun was still shining this week as I traveled around our remarkable district. Tuesday, immediately after returning from the Special Session, I met for more than two hours with the Oregon Coast Learning Institute. It was a wide-ranging, candid, and informative exchange. Two hours is a long time to stand up and talk. I hope I didn’t finish speaking before they all finished listening.
Friday night, Susie and I were at the Summer Nights Jazz series in Newport. Then Saturday, we made the trek to Corvallis for football and networking with President Jayathi Murthy. I’m always proud to wear my OSU Newport jersey and remind people that the Coast has Oregon State, too!

We also dropped in on the vibrant community of Alsea and their Blackberry Blast. Great pie! Great burgers. And great people!

Thursday I’ll be very pleased to visit Oregon Coast Community College and celebrate a landmark moment in its history—and in the future of Lincoln County’s economy and youth—with the official groundbreaking ceremony for the Oregon Coast Advanced Technology & Trades (OCATT) Center.

Immediately after, at noon, I’ll be at the PAC in Newport to take questions again as part of the Hear Here series.

 

Thanks for your weekly interest. I hope you didn’t finish reading before I finished writing!

Warm Regards,
Representative David Gomberg

House District 10

email: Rep.DavidGomberg@oregonlegislature.gov

phone: 503-986-1410

address: 900 Court St NE, H-480, Salem, OR, 97301

website: http://www.oregonlegislature.gov/gomberg

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