Oregon gives owners of fuel-efficient vehicles a choice: higher registration fee or mileage fee

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Updated Dec 31, 2019

Gas Tax

Oregon drivers will not only pay a higher gas tax starting in January but those driving fuel-efficient vehicles will have a higher registration fee to account for the lower amount of gas taxes they pay.

Fuel-efficient vehicle drivers, however, will have the option to pay a lower registration fee, if they sign up for the state’s fee-per-mile program known as OReGO. The program, which began as a pilot in 2015 with a cap of 5,000 drivers, charges participants monthly based on the amount of miles they drive. They then receive credits on their monthly bills for any state gas taxes they paid.

The 2-cent-per-gallon gas tax increase and change in registration fees are part of legislation enacted in 2017 to better fund the state’s roads and bridges. There will also be an increase in fees for commercial trucks and buses.

The concern – a growing one across the country – is that owners of fuel-efficient hybrid and electric vehicles are leading to lower gas-tax revenues at a time of increasing infrastructure needs and costs. Alternative taxation methods are being considered. Fees per miles driven are gaining interest, also called road user charges or miles-based user fees.

In February, seven states, including Oregon, received portions of $10.2 million in grants from the Federal Highway Administration to test similar alternatives to gas taxes. Those other states are California, Delaware, Minnesota, Missouri, New Hampshire and Utah. Oregon’s grant also encompasses the regional Western Road User Charge Consortium that includes itself and 10 other states. The state of Washington has also been debating whether to switch to miles-based fees, but any decision appears a long ways off. It does plan to start charging higher annual registration fees for electric and hybrid vehicles.

In Oregon, the new higher registration fees are based on a vehicle’s miles per gallon, with higher mpg-rated vehicles charged a higher fee. The volunteer OReGO program is available for cars that get at least 20 mpg, but only those with at least 40 mpg can get a break on the registration fee by joining OReGO.

Starting in 2020, the 5,000-participant cap on OReGO will end, and there will be no limit on the number of participants. Currently, fewer than 2,000 vehicle owners participate in the program. The program charges 1.8 cents per mile. Many expect the numbers of participants to rise as the new registration fees kick in. OReGO’s per-mile fee also goes up each year.


Registration fees based on mpg

The Oregon DOT has provided the following summary of the new fees for passenger vehicles, which come due when registrations expire (new vehicles are registered for four years at first, then every two years):

Most passenger vehicles
Fuel economy   Four years      Two years
0-19 mpg                $244                   $122
20-39 mpg             $264                   $132

High-mileage passenger vehicles
Fuel economy                             Four years     Two years
40+ mpg NOT in OReGO             $304                   $152
40+ mpg enrolled in OReGO       $172                    $86
Electric NOT in OReGO                $612                    $306
Electric enrolled in OReGO          $172                    $86

Drivers can compare what they would pay in OReGO versus what they currently pay in gas taxes by plugging their car’s mpg rating and the typical number of miles they drive into the OReGO calculator at MyOReGO.org/calculator.