Oregon allows state agencies to withhold payments to the federal government when federal funds are withheld

Original title: Authorizes the Governor to direct state agencies to withhold moneys owed to the federal government if federal funds are being withheld from the state in contravention of a valid court order.

Last action · March 6, 2026: At President's desk upon adjournment.Sponsors: Willy Chotzen and 31 others

Bill progressHistory & official text ↓

Introduced

Committee

Floor Vote

Passed

Law

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What This Bill Would Do

The state permits the Governor to order state agencies to withhold money owed to the federal government if federal funds are being withheld from Oregon in violation of a court order, excluding certain payroll and tax funds. Any remaining money in the holding account on January 2, 2037, transfers to the General Fund.

Why it matters

State agencies alter payment flows to federal authorities, and state officers receive legal indemnity for compliance, while unallocated funds shift to the General Fund upon the measure's repeal.

Who It Would Affect

Groups the bill's text would affect if enacted, as described in the record. Being affected is not a position for or against it.

Directly affected

State agencies

State agencies may be directed by the Governor to withhold specific payments owed to the federal government.

Directly affected

Federal government

The federal government may experience withheld payments from Oregon state agencies.

Key Facts

You don't have to trust us. Each fact below is taken straight from the official document - click any one to see the exact passage, highlighted in the original.

Frequently Asked Questions

What funds are excluded from being withheld from the federal government?

Excluded funds include state officer or employee payroll taxes, voluntary federal income tax withholdings from unemployment insurance and paid family and medical leave insurance benefits, and revenues or overpaid benefits under the Federal Unemployment Tax Act or ORS chapter 657.

What happens to remaining money in the holding account when the law sunsets?

Any moneys remaining in the Federal Moneys Holding Account on January 2, 2037, are transferred to the General Fund for general governmental purposes.

What else do you want to know?

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Where This Stands

Currently passed chamber. The next step in the legislative lifecycle is Law.

Procedural history

13 actions

Mar 6, 2026Senate
At President's desk upon adjournment.
Feb 25, 2026Senate
Work Session held.
Feb 23, 2026Senate
Public Hearing held.
Feb 19, 2026Senate
Referred to Judiciary.
Feb 19, 2026Senate
First reading. Referred to President's desk.
Feb 19, 2026House
Third reading. Carried by Chotzen. Passed.

Show 7 earlier actions

Feb 18, 2026House
Rules suspended. Carried over to February 19, 2026 Calendar.
Feb 17, 2026House
Second reading.
Feb 16, 2026House
Recommendation: Do pass with amendments and be printed A-Engrossed.
Feb 12, 2026House
Work Session held.
Feb 3, 2026House
Public Hearing held.
Feb 2, 2026House
Referred to Rules.
Feb 2, 2026House
First reading. Referred to Speaker's desk.

Version history

Only one version on file - nothing to compare yet. As later stages (committee substitute, engrossed, enrolled) are captured, the redline appears here.

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