Why It Matters
Oregon voters have rejected nearly two-thirds of laws referred to the ballot through the state’s referendum process throughout history, signaling deep public skepticism of legislative decisions on taxes, fees, and major policy changes. The upcoming May vote on Measure 120—a controversial 2025 transportation law that would raise vehicle fees, increase the gas tax, and expand a payroll tax for public transit—represents the 67th referendum in Oregon’s history and underscores ongoing tension between Democratic lawmakers, Republicans, and voters concerned about the cost of living. The outcome will directly affect Oregon’s Department of Transportation funding and shape how the state addresses infrastructure challenges in the coming years.
What Happened
Oregon lawmakers passed a 2025 law designed to address budget shortfalls within the Department of Transportation through new tax and fee increases. In response, opponents collected over 200,000 signatures—more than double the 78,000 required—to force a referendum and place the measure on the ballot. The petition effort was led by Republican state representatives and the Taxpayer Association of Oregon. Despite legal challenges to move the vote to November’s general election, a Marion County judge ruled the measure would likely survive additional legal challenges, and the vote is scheduled for May 2026.
Measure 120, if approved by voters, would increase most vehicle title and registration fees, raise the gas tax from 40 cents per gallon to 46 cents, and double the payroll tax for public transit from 0.1 percent to 0.2 percent of a worker’s paycheck through 2028. The measure represents one of the largest points of contention between Oregon’s Democratic leadership and Republicans seeking to reduce the financial burden on residents.
By the Numbers
Throughout Oregon’s history, voters have faced 67 referendum measures. Of those, voters approved just over one-third—meaning roughly 23 laws survived public opposition. Voters rejected 42 laws through the referendum process. In 2018, Oregon voters approved higher taxes on hospitals and health insurers to fund Oregon Health Plan coverage after federal Medicaid cuts. The gas tax increase in Measure 120 represents a 15 percent increase, rising from 40 cents to 46 cents per gallon. The payroll tax for public transit would double from 0.1 percent to 0.2 percent of worker paychecks, with the increase lasting through 2028. Petitioners submitted more than 200,000 signatures to secure the ballot placement, exceeding the threshold by more than 156 percent.
Zoom Out
The referendum process reflects a national pattern of voter skepticism toward tax increases and legislative decisions on fiscal policy. Oregon’s history shows that major tax and fee increases face significant public resistance, particularly when they affect transportation costs and payroll deductions. The 2018 approval of hospital and health insurance taxes during the first Trump administration’s Medicaid cuts demonstrates that voters may support tax increases when they perceive immediate, critical needs—though such approvals remain the exception rather than the rule in Oregon’s referendum history.
The use of referendums has grown as a mechanism for citizens to overturn laws they oppose, and Oregon has frequently moved such votes outside the November general election cycle. Since 2000, five of seven Oregon referendums have been scheduled for special elections in months other than November, allowing the state to manage ballot complexity while honoring the petition process. This pattern reflects broader national trends where citizens increasingly use direct democracy tools to challenge legislative decisions on taxation and spending.
What’s Next
Oregon voters will decide Measure 120 during a special election in May 2026. If approved, the law would increase vehicle registration and title fees immediately, raise the gas tax to 46 cents per gallon, and implement the payroll tax increase for public transit through 2028. If rejected, lawmakers will need to identify alternative funding sources to address the Department of Transportation’s budget shortfalls. The measure’s fate will likely influence future transportation policy discussions and demonstrate whether Oregonians prioritize infrastructure investment or cost-of-living relief. Additional legal challenges are possible, though current judicial rulings suggest the referendum will proceed as scheduled. The outcome could set precedent for how Oregon addresses future infrastructure and transit funding debates, particularly as transportation systems require ongoing investment and maintenance.