The City's Transportation Fee (sometimes known as a transportation utility fee or TUF) is a recurring monthly fee to be used for operations and maintenance of the City transportation system, which may include pavement restoration, street preservation, signs, striping, sidewalk and other concrete work, bicycle and multi-modal system enhancement, street sweeping and cleaning, winters operations such as snow removal and implementation of programs identified in the Transportation System Plan.  

Everyone relies on the transportation system (e.g., mail delivery, garbage hauling services, food delivery, bus routes, walking, biking, and driving to work, school, and services, etc.). Transportation Fees are most often used for the maintenance and repair of a city’s transportation system. A Transportation Fee provides a stable source of revenue to support our transportation system, allowing for safe and efficient movement of people, goods, and services.

In the past, the City has relied on revenues from the State Gas Tax and a portion of property taxes to maintain the City’s street system, but these funding sources are limited and declining over time for several reasons.

Gas Tax Limitations. The amount available from state gas tax revenues, which is governed by state law, for street maintenance continues to decrease while the wear and tear on our roads increases as we grow. Increased fuel efficiency and growth of electric vehicles (which don’t consume taxable fuels) have led to less fuel consumption, but does not reduce impact to the road system. And even though fuel costs have increased, gas tax receipts are based on a per-gallon calculation (not per dollar). The City does not have a local gas tax. A local gas tax would require a public vote. Bend voters rejected a gas tax when one was proposed on the ballot in 2016. 

Property Tax Limitations. In the past, a small portion of the City’s General Fund has been used toward much-needed street preservation activities; however, these have been discretionary, one-time investments. Property taxes are the biggest source of revenue for the General Fund, which primarily pays for public safety needs. Property tax rates and increases to property assessed values are limited by state law (Measures 5 & 50), and Bend has one of the lowest property tax rates in the state, which cannot be raised. Because of these legislative restrictions on property taxes, many jurisdictions in Oregon need to seek levies, bonds, or other revenue sources to help fill funding gaps. 

The City maintains a growing transportation system that includes 900 lane miles (an 11% increase since 2008), 516 sidewalk miles, and, in recent years, an expanding network of striped, separated, and buffered bike lanes (111 miles and counting). Limited funding, a growing transportation system, and cost escalation have resulted in an increasing backlog of maintenance needs. The City can no longer rely on declining and discretionary funds to maintain its transportation network.

The City needed to come up with its own sustainable revenue source to meet our local needs. In 2019, the Citywide Transportation Advisory Committee’s (CTAC) Funding Work Group recommended a Transportation Fee as a preferred funding option to help protect the City's street infrastructure investment. A Transportation Fee was also recommended as a funding tool by City Council advisory committees in 2009 and 2011. 

The Transportation Fee will be implemented in three phases, through fee resolutions adopted by City Council. The code says Phase 1 fees should raise $5 million in fiscal year 2024-2025. Phase 2 fees should raise $10 million in fiscal year 2025-2026, and Phase 3 should raise $15 million in fiscal year 2026-2027 and beyond. 

The basis of the Transportation Fee is on a household or business' impact to the transportation system. 

In Phase 1, single-unit utility bill accounts can expect to pay $5.60/month. Multi-unit attached housing (like an apartment) accounts can expect to pay $4.15/month (per unit). 

Industry data sources provide estimates of the number of trips generated by different types of dwellings (e.g., single-family detached homes vs. multi-family attached housing like apartments) on average. Charging a uniform rate per dwelling unit by type of unit based on these averages is consistent with industry standard practice and helps minimize administrative costs because the information is readily available and easy to monitor. Based on data from the Institute of Transportation Engineers (ITE) Trip Generation Manual, multi-family households generate fewer trips on the system overall - about 70 percent of the impact on the road system as compared to single-family households. 

Nonresidential fees are also going to be phased in over three years, with the first year generally using square footage as a method to scale and calculate fees. Most nonresidential accounts (up to 50,000 square feet) can expect to pay $6.25 per 1,000 square feet in the first year. In Phase 2 of the fee and beyond, the nonresidential fee will additionally factor in business use data into how fees are calculated, meaning that nonresidential uses that generate more trips on our transportation network could pay more than those that don’t tend to generate as many trips. 

The Phase 1 rates that become effective starting July 1, 2024, can be found here. 

Rates are based on trip generation estimates for broad customer categories using land use information available primarily through the Bend-Redmond Travel Demand Model and Institute of Transportation Engineers (ITE) Trip Generation Manual. Using this approach, estimates show approximately 53% of the total impact is from residential customers and 47% from nonresidential customers, which means each category should generate that same share of the total revenue from the fee.

A technical memorandum summarizing the analysis used to establish Transportation Fee rates for Phase 1 can be found here.

No, a Transportation Fee is not a tax. A tax is an amount or rate charged generally to everyone to pay for a variety of governmental functions, whereas a fee is charged to users of a government service to pay for that specific service. A Transportation Fee treats the transportation system like a utility by charging residents and businesses a share of transportation system costs. The Transportation Fee provides a stable source of revenue to pay for street maintenance and other planned transportation programs, allowing for safe and efficient movement of people, goods and services for the community. The street system is a public investment that deserves protection and cost-effective regular maintenance. The Transportation Fee revenues can be spent only on the service provided -- the street and transportation system. The money collected from the fee will not be available for other government services or functions.

For a more detailed explanation, please read this legal memo.

Even if you don’t drive, all community members and businesses still benefit from the road system (e.g., mail delivery, garbage hauling services, food delivery, bus routes, etc.). Additionally, the City takes a “Complete Streets” approach, in which the operation and maintenance of streets enable safe access for all people who use them including pedestrians, bicyclists, motorists, and transit riders.

GO Bond money can legally only be used to build projects, not to maintain them or perform regular repairs. Voters passed GO bonds in 2014 and 2020 to construct transportation projects around the City. To learn more about how the City is using 2020 GO Bond dollars, you can visit the GO Bond Dashboard. 

Many other Oregon cities are experiencing exactly what Bend faces: inadequate funding for transportation system maintenance. Needs in most communities in Oregon have grown while funding has fallen behind. While the structure, application, and name of the fees vary, over 30 cities in Oregon have this type of fee. Transportation Fees are used in other states as well, including in communities in Texas, Florida, Colorado, and Montana.

Of Bend's 900 lane miles, 22% are arterials (the busiest main streets), about 8% are collector streets, and 70% are local or neighborhood streets. The replacement value of the City’s street network (i.e., the current cost to reconstruct each street base and surface, not including curbs or sidewalks) is currently estimated at $829 million.  In other words, our street network is a significant asset for the City to manage.

The Transportation Fee was a funding option preferred by the Funding Work Group, a subset of the Citywide Transportation Advisory Committee (CTAC), during the 2020 Transportation System Plan update. The Funding Work Group, made up of nine community representatives, looked at many different funding options based on factors such as equity, efficiency, and impact. Following these discussions, the Transportation Fee received broad support.

Before adoption of fees in Phase 3, Council will discuss other revenue sources recommended in the Funding Strategy of the Transportation System Plan. The discussion will include how to increase revenue from individuals who do not live in Bend but come to the City and use the transportation system, whether to put a gas tax measure on the ballot, and whether or how these additional revenue sources should affect the revenue targets and rates for Phase 3 of the Transportation Fee implementation plan. 

There are mechanisms in place for the Transportation Fee to account for visitor use on our system. Typically, Transportation Fees are based on traffic impact generated by specific types of development, using data from the ITE (Institute of Transportation Engineers) Manual. Different types of development vary in their demand on transportation infrastructure, with some creating more wear and tear than others. For instance, visitors who stay in hotels and short-term rentals account for a portion of trips on the transportation network, which is accounted for in how Transportation Fees for lodging accommodations, including short-term rentals, are set. In this way, the Transportation Fee provides a method for visitors to help fund maintenance of the roads they are using while visiting. 

The most direct way to assess visitors is through a lodging tax. State law governs how TRTs (which includes hotels, motels, and similar facilities) can be used. Currently, anyone staying in a Bend hotel, vacation rental or other short-term lodging pays a 10.4% transient room tax (TRT). Of the revenue generated, 65% goes to the City's General Fund (which supports public safety and other core services) and 35% is required by state law to be used for tourism promotion including marketing and tourism-related facilities.  

An increase to the TRT is not a preferred funding method, as under state law, the City would only get 30% of that revenue; 70% of revenue from any increase in the TRT must be used to fund tourism promotion or pay for tourism-related facilities.  

The Funding Work Group recommended additional funding tools that may be considered in the future. Some of those tools, such as a seasonal fuel tax and targeted food and beverage tax, would allow visitors to help fund the City's transportation needs.  

Over 30 cities in Oregon have a Transportation Fee. The chart below shows a sampling of cities that charge a Transportation Fee and how much each community charges single family residences per month.

Source: City of Creswell, Oregon (January 2023), updated by City of Bend (August 2023)
Click the image to enlarge.

The City Council will set the fee amounts and decide how the fee is spent in the fee ordinance and again in each two-year budget. The budget adoption process is a public process and includes a community advisory committee. The Transportation Fee will be used to enhance the entire transportation system through better operations and maintenance and through implementing programs recommended through a broad community engagement process during the update to the Transportation System Plan.

The adopting ordinance outlines accountability measures to build transparency and public trust, including reporting on how Transportation Fee dollars are spent within the overall budget and information on future proposed expenditures.  Additionally, the ordinance outlines opportunities for public engagement in developing the Phase 2 rate structure, including with the Bend Economic Development Advisory Board, before Council makes a decision on implementation of Phase 2 rates, as well as committing to a Council discussion of other revenue sources before Council makes a decision on implementation of Phase 3 rates.

The person responsible for the Transportation Fee (typically the utility account holder) may file a Transportation Fee Appeal, to review whether the amount charged is correct.

An appeal or review may be conducted based on:

1. Incorrect customer class assignment (residential instead of business, etc.),
2. If there is an error in the square footage calculation for nonresidential accounts, or
3. The parcel exists in its natural unimproved condition and is not connected to the City’s stormwater, sewer, or water system.

Visit the Utililty Forms page to download an appeal form or contact Customer Service at 541-388-5515 for additional information.

Any fees due to the City of Bend that are not paid will be subject to standard delinquency processing.