Oregon’s Aviation Agency Runs on a 1955 Tax Rate
Oregon’s Department of Aviation is heading into the 2027-29 budget cycle facing a $3 million shortfall, and the cause traces directly to a jet fuel tax rate frozen in place for more than 70 years. The agency collects half its operating revenue from that tax, and the rate has not moved since 1955.
Oregon Department of Aviation Director Kenji Sugahara made that concrete for lawmakers on the interim House transportation committee on June 15, 2026: in 1955, 1 cent bought the tax on one gallon of jet fuel. It also bought a McDonald’s hamburger for 15 cents. Hamburgers now cost several dollars. The tax rate has not followed.
“Without those [airports], fires would be pretty much out of control because it takes time to get to the fires and also to be able to refuel and then get additional water or any other supplies that are needed.”
Kenji Sugahara, Director, Oregon Department of Aviation, June 15, 2026
28 State Airports Support Wildfire & Emergency Response
The agency manages 28 state-owned airports, including the Oakridge and McKenzie Bridge State Airports in the Cascades, which serve as bases for helicopter crews fighting wildfires in the Willamette National Forest. These airports also support emergency air medical transportation throughout the region. Without new revenue, Sugahara told lawmakers, the agency will have to defer maintenance and inspections. Closing some airports is the worst-case scenario.
The agency has 15 employees. Most positions exist specifically to satisfy federal regulations, oversee inspections, and process federal grants. Layoffs are not a realistic cost-cutting path.
Aircraft are also becoming more fuel-efficient, so the agency collects less jet fuel tax per flight even as personnel and maintenance costs increase. The structural gap will widen over time.
Past Tax Increases Did Not Fix the Operating Budget
Oregon lawmakers raised the jet fuel tax in 2015, moving it from 1 cent to 3 cents per gallon. That money was designated for an airport grant program, not the agency’s operating budget. A 2025 bill proposed raising the rate to 6 cents per gallon, but the funding crisis persists into the current budget discussions, indicating no resolution has taken effect.
The aviation shortfall arrives alongside a broader Oregon transportation funding problem. Voters in May 2026 rejected a Democratic-backed measure that would have raised the gas tax, vehicle registration fees, title fees, and a transit payroll tax. The Oregon Department of Transportation faces its own impending financial crisis at the end of the 2025-27 budget cycle.
The fix for the aviation agency requires the Oregon Legislature to raise the jet fuel tax rate and direct the proceeds toward operations, not just grant programs.
What You Can Do Now
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Contact your Oregon state representative and senator. Tell them to raise the jet fuel tax and direct the revenue to the Oregon Department of Aviation’s operating budget before the 2027-29 budget cycle begins. Find your legislators at oregonlegislature.gov/findyourlegislator. The interim legislative period is the window to build support before the 2027 session.
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Call the Oregon House Transportation Committee directly at (503) 986-1000 and ask that a jet fuel tax increase with an operations funding mechanism be included in the 2027 legislative agenda. The committee heard testimony on this issue on June 15, 2026.
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Contact Governor Tina Kotek’s office at (503) 378-4582 and ask her to include aviation agency funding reform in her 2027-29 executive budget recommendation. Governors set budget priorities before the legislature votes.
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If you live in a rural Oregon county with a state airport (Lane, Linn, Marion, or Klamath, among others), contact your county commissioners and ask them to formally urge the legislature to act. Local government pressure on rural infrastructure funding carries weight with lawmakers who represent those districts.
Sources
Oregon Department of Aviation: Agency Overview and Airport Directory
Oregon Legislature: Find Your Legislator Tool
Oregon Capital Chronicle: Oregon Voters Reject Transportation Funding Package in May 2026
, fires would be pretty much out of control because it takes time to get to the fires and also to be able to refuel and then get additional water or any other supplies that are needed.”, Kenji Sugahara, Director, Oregon Department of Aviation. Oregon Capital Chronicle]