The Oregon Department of Transportation will avoid layoffs and deep service cuts following the passage of legislation that addresses a $297 million budget shortfall for the agency’s maintenance and operations work.
The action prevents layoffs and widespread service reductions that would otherwise have disrupted daily travel and essential services. Highway maintenance crews will remain on the job, safety and storm response operations will continue, and DMV offices will remain open to serve customers.
The legislation redirects $218 million from existing state transportation funds to support operations and maintenance. As a result, some programs will see impacts, including delayed or reduced grant funding for programs such as Safe Routes to School and Connect Oregon. Safe Routes to School funds projects that improve safety for students walking and biking to school. Connect Oregon is a state grant program that invests in aviation, rail and marine projects.
“This legislative action provides important short-term stability for Oregon’s transportation system,” said Interim Director Lisa Sumption. “It allows us to avoid deep reductions while continuing to focus on providing the services Oregonians rely on. At the same time, redirecting existing funds from programs that serve important functions is not a long-term solution. Oregon’s transportation system needs a long-term fix.”
In addition to the fund redirections, the legislatively adopted budget reduces ODOT’s authorized spending levels by nearly $80 million. These reductions build on steps ODOT has already taken in recent years to control costs, including leaving positions unfilled. Since 2019, the agency has reduced spending by more than $500 million, and the current budget already reflects more than $200 million in reductions.
ODOT currently has about 700 vacant positions statewide, representing nearly 15% of the agency’s workforce. More than 350 of those vacancies resulted from employees leaving the agency during ongoing financial uncertainty since July 2025.
Under the newly adopted budget, the agency will continue to leave more than 130 positions unfilled. The department expects to begin hiring for critical vacancies immediately, which will help restore staffing in key areas and strengthen frontline teams across the state.
While this legislative action stabilizes operations for the remainder of the current budget cycle, it does not resolve the underlying funding challenges facing Oregon’s State Highway Fund. That fund supports not only ODOT, but cities and counties across the state. The current funding model is not keeping pace with rising costs and growing statewide needs. Lawmakers have stated they plan to revisit transportation funding during the 2027 legislative session.