Street damage restoration fee, explained

What is it?

The street damage restoration fee provides local funding for paving maintenance. Fees will be charged to utility companies, contractors, or other entities that excavate and trench in the public right-of-way and will go into the Street Damage Restoration Fund to pay for paving work. Similar fees exist in cities like Los Angeles, San Francisco, Oakland, San Diego, and Seattle.

Why do we need it?

In just the last three years, roughly 50 miles of Portland roads have been trenched for excavation. This kind of work reduces the useful life of pavement by over 60%, meaning the street needs to be repaved again in five years instead of 15.

View full size image of Graphic showing continued deterioration and accelerated cracking above ground and weakened edges below ground.

How will it work?

• Starting on Jan. 1, 2027, the fee will be integrated into the existing Street Opening Permit which is required to install, repair, or maintain underground infrastructure for water, sewer, gas, power, and telecommunications.
• For 2027, the damage fee will be $13.84 per square foot and only assessed on street opening permits that have a pavement impact.
• The fund is estimated to bring in about $11 million in the 2026-27 fiscal year. This initial estimate will be refined over time.
• The public administrative rule-making process began summer 2026. The public comment period will begin in fall 2026. 

How will the money be spent?

The Street Damage Restoration Fund will be spent on pavement maintenance and restoration. This work could include grinding, paving, sealing, and base repair.  

Timeline

• July 2025: In the context of Portland's deepening transportation budget crisis, council adopted Resolution 37712 directing the Public Works and Budget and Finance service areas to "develop a comprehensive strategy to identify and evaluate viable alternative funding sources."
• July–December 2025: City staff developed an Alternative Transportation Funding Report reviewing possible funding approaches and presented it to council's Transportation and Infrastructure Committee on Dec. 15, 2025 which directed staff to further develop four revenue approaches. 
• January 2026: City staff presented these approaches to the Transportation and Infrastructure Committee on Jan. 26, 2026. which directed staff to proceed with public review.
• February–March 2026: PBOT held four in-person open houses (one per council district) Feb. 19 – March 3 with open house materials available online and an online survey open Feb. 19 - March 4. Staff then presented the feedback to the Transportation and Infrastructure Committee March 9.
• April 2026: Council's Finance and Governance Committee of the Whole considered an ordinance and a resolution on April 2 to establish a transportation utility fee and affirm support for a street damage restoration fee. This advanced to the full council, heard at the April 15 City Council meeting where they approved the street damage restoration fee resolution, then continued their discussion on the transportation utility fee at the April 16 City Council meeting where they amended and moved the ordinance to the full April 30 City Council meeting, when the transportation utility fee was adopted.
• In progress now: The city is modifying its Street Opening Permit process which is already required to install, repair, or maintain underground infrastructure for water, sewer, gas, power, and telecommunications.
• In progress now: The public administrative rulemaking process is moving forward now and should conclude in the fall. 
• January 2027: The city will start collecting the fee.