LOC News
Wildfire Funding Starting to Take Shape – City Action Needed on HB 3940
For years, Oregon has struggled with stable wildfire funding. It has certainly worsened over the last few years, largely due to the Legislature’s unwillingness to fully fund readiness, firefighting, and resilience projects. Since the summer of 2024, a group known as the “Fire 35” has met regularly, attempting to identify a new stable funding source and offer recommendations to the Legislature. LOC Legislative Director Jim McCauley represented cities on this advisory group and helped develop a set of funding recommendations. Unfortunately, none of the funding recommendations included new revenue sources that were legislatively viable.
With roughly a week remaining in the 2025 legislative session, there’s been a slight breakthrough with a new funding source. A few amendments are being considered for HB 3940 that would impose a tax on synthetic tobacco pouch products. Currently, the product line is not included in the tobacco tax category. Based on estimates, this new tax is expected to generate $30 million per biennium with a 0.65 tax per container. By adding this new tax, wildfire funding advocates believe they have a good chance at capturing additional interest income from the state’s Rainy-Day Fund. Governor Kotek has recommended that the Legislature dedicate the full interest earnings, estimated to be $164 million each biennium.
This tax is not without controversy, as health care advocates object to the use of tax revenue from this source of synthetic tobacco for non-health-related purposes. The LOC testified in support of amendments that created the new tax and supported the governor’s recommendation for the additional $164 million of directed interest revenue. The LOC is recommending that members contact their legislators with the following message:
- Stabilizing wildfire funding is critically important in this session;
- We support the implementation of a new tax on synthetic tobacco pouches and the allocation of the revenue for wildfire funding; and
- We support using the full amount of the Rainy-Day Fund interest for wildfire funding.
Contact: Jim McCauley, Legislative Director - jmccauley@orcities.org
Last Updated 6/20/25