(1) Except as provided in subsection (2) of this section, the appropriation specified in ORS 366.800 shall be allocated to the cities as provided in this subsection. The moneys subject to allocation under this subsection shall be distributed by the Department of Transportation according to the following: (a) The moneys shall be distributed to all the cities. (b) Each city shall receive such share of the moneys as its population bears to the total population of the cities. (2) Each year, the sum of $2,500,000 shall be withdrawn from the appropriation specified in ORS 366.800 and $2,500,000 shall be withdrawn from moneys available to the Department of Transportation from the State Highway Fund. The sums withdrawn shall be transferred to a separate account to be administered by the Department of Transportation. The following apply to the account described in this subsection: (a) Money from the account shall be used only on roads: (A) That are not a part of the state highway system, with the exception of project elements that are required to comply with federal or state law; (B) That are within cities with populations of 5,000 or fewer persons; and (C) That are inadequate for the capacity the roads serve or are in a condition detrimental to safety. (b) To the extent moneys are available to fund whole projects, all moneys in the account shall be allocated each year. (c) Subject to paragraph (d) of this subsection, the department shall determine annual allocation after considering applications, including project budgets, submitted by the cities to the department. (d) The department may enter into agreements with cities upon the advice and counsel of the small city advisory committee to determine allocation based on those applications. (3) The Director of Transportation shall establish a small city advisory committee. The small city advisory committee shall review department recommendations and approve applications submitted by small cities to the director. In consultation with the League of Oregon Cities, the director shall appoint to the small city advisory committee one representative of a small city in each of the five regions of this state. (4) For purposes of this section: (a) Region one consists of Clackamas, Hood River, Multnomah and Washington Counties. (b) Region two consists of Benton, Clatsop, Columbia, Lane, Lincoln, Linn, Marion, Polk, Tillamook and Yamhill Counties. (c) Region three consists of Coos, Curry, Douglas, Jackson and Josephine Counties. (d) Region four consists of Crook, Deschutes, Gilliam, Jefferson, Klamath, Lake, Sherman, Wasco and Wheeler Counties. (e) Region five consists of Baker, Grant, Harney, Malheur, Morrow, Umatilla, Union and Wallowa Counties. [Amended by 1959 c.170 1; 1985 c.123 1,2; 1989 c.865 6; 1991 c.355 1; 2017 c.750 72; 2023 c.400 6] Note: 366.805 is amended by Enrolled House Bill 3991 (2025 special session). As of the date of publication of the 2025 Edition of the Oregon Revised Statutes, Enrolled House Bill 3991 (2025 special session) is subject to potential referendum petitions that may be filed with the Secretary of State as provided in Article IV, section 1, of the Oregon Constitution. The full text of Enrolled House Bill 3991 (2025 special session) is set forth following 801.610.
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