The Portland City Council voted Wednesday to implement a fee that will offer a significant new source of funding for the city’s beleaguered transportation bureau. The transportation utility fee will be officially implemented starting in January 2027, coming in the form of an additional charge tacked onto Portlanders’ water and sewer bills. The new program is expected to generate roughly $46 million annually, which will help pay for services including pavement and sidewalk maintenance and repair, traffic signal maintenance, and transportation safety programs.
The City Council’s 9-3 affirmative vote didn’t come as a surprise, as most councilors have stated their support for the measure in recent weeks. But its passage is still notable after years of failed attempts to shake up how the Portland Bureau of Transportation (PBOT) generates revenue and pays for key maintenance work.
PBOT’s budget will also benefit from a street damage restoration fee City Council passed two weeks ago, expected to generate about $20 million annually by requiring utility companies to pay more when they dig up city pavement.
Council Vice President Olivia Clark, who chairs the City Council’s Public Works Committee and led the effort to find new sources of funding for PBOT, told the Mercury the fees will “bring sustainable funding to our transportation system.”
“If we do not make investments now, we are simply passing the buck and further burdening future Portlanders,” Clark said. “Given the extreme risk of doing nothing, this was the fiscally responsible move.”
Councilors Dan Ryan, Loretta Smith, and Eric Zimmerman voted against the transportation utility fee.
Portland officials have weighed a utility fee like this for years, hoping to make a dent in the city’s longstanding (and ever-growing) transportation maintenance backlog. Councilor Steve Novick came close to getting a street fee over the finish line during his first stint in City Hall in the early 2010s. But Novick lacked sufficient support from his colleagues on the Council and his attempts failed.
Given that history, it’s notable the current Council was able to pass this policy in such a short period of time. Clark and the rest of the Public Works Committee (formerly known as the Transportation & Infrastructure Committee) first introduced the idea just under a year ago, as part of a broader push to find alternative revenue streams for PBOT.
At the April 22 Council meeting, Novick chalked up the policy’s success to the new government structure.
“I think Portland was handicapped by the commission form of government and the fact that there was only one transportation commissioner at a time, and people who weren’t the transportation commissioner didn’t feel a sense of responsibility for [Portland’s streets],” Novick said. “In this Council, we all recognize we all have a responsibility for the major functions of government, including the streets.”
The transportation utility fee will cost most Portlanders between $8.40 and $12 a month, depending on if they live in multi-unit housing or a single-family home, with low-income discounts available. Business owners will be charged a percentage of their monthly water use.
Transportation utility fees have been implemented in many cities around the US, including several in Oregon, and are generally considered a reliable way to generate income for core transportation services. While the policy proposal received largely positive feedback during open houses hosted by PBOT earlier this year, many Portlanders voiced their opposition to the plan in more recent public testimony. Still, councilors deemed its benefits too important to ignore, considering the dire state of Portland’s transportation assets.
“We are all desperate to fix our streets—pavement crumbling, dangerous potholes, streetlights in danger of falling over, bridges needing more preventive maintenance, and more. Sadly, it would take billions of dollars to fully bring the system up to the appropriate standards, but we can take steps now to stop further erosion,” Clark said. “Past mayors and Councils have not taken action to address this crisis, but this Council is on it.”
