Oregon's 25-year, $5,000 submarine-cable fee is becoming $3 a foot

For 25 years, the cost of laying a transoceanic fiber cable across Oregon's sea floor was a single $5,000 application fee. Now the Oregon Department of State Lands is rewriting the math: roughly $3 per linear foot of cable plus $7 per bore-pipe section, paid as a single lump sum on a 20-year lease, with the proceeds routed to Oregon's Common School Fund, the state's century-old public-school endowment. The new rate is set just below California's roughly $5-per-foot annual schedule, so the next Amazon or Google cable still wants to come ashore in Oregon.

The agency says the structure is meant to be "competitive-to-low" relative to neighboring states, and the numbers line up. California charges roughly $5 per linear foot on an annual basis, while Oregon's lump sum works out to a far lower effective annual rate. Oregon is pricing the right-of-way under transoceanic fiber the way it already prices other corridors: per unit, on a long lease, with a competitive posture toward the next-door state.

The worked example comes from DSL's June 2026 fees schedule and runs on Amazon's planned Bifrost cable. At the proposed rates, the cable would generate about $1,450,380 over its 20-year lease for the school fund. That figure is meaningful against a Common School Fund that has historically depended on land-sale revenue, but the fee itself is a sliver next to the cost of a transpacific cable build. It is closer to a right-of-way toll than a share of the construction budget.

The legal scaffolding is Oregon Senate Bill 793, passed in the 2025 regular session. The bill gave the Department of State Lands the authority to set a per-foot fee for submarine cables crossing state-owned sea floor, ending a quarter-century run on the 2001 schedule. The current draft rule text simplifies an earlier version that priced bore pipes, the protective steel casing where the cable comes ashore, by cross-section. The agency dropped that structure as too complex to administer and now lands on a per-section fee that is in public comment.

The fees are still in rulemaking as of July 2026, and nothing in the new schedule is enacted. Already-approved cables appear to be largely exempt, and Bifrost itself may be locked in at the old rate under prior terms. The original Oregon Capital Chronicle report and subsequent industry coverage both frame this as a forward-looking right-of-way repricing rather than a windfall hitting the school fund next quarter. The $1.45 million Bifrost number is a worked estimate, not a contracted rate.

For decades, the sea floor under transoceanic fiber was treated like a free easement: a one-time filing fee, no per-unit charge, no ongoing rent. State highway departments charge by the mile for fiber in the right-of-way, port authorities lease dock space by the linear foot, and railroads price their corridors by the ton-mile. Cables carrying the bulk of intercontinental internet traffic were the exception. Oregon is the first U.S. state to write down a per-foot price for that layer, and the price is being set explicitly below California's so that the build pipeline keeps pointing north.

The other coastal states with submarine landings, including Washington, New Jersey, Virginia, and Florida, are all watching. None of them have filed an equivalent rule. Washington's Department of Natural Resources and California's State Lands Commission administer sea-floor use differently, and Virginia's landings cluster in the Chesapeake Bay rather than the open Pacific. Oregon's move does not change any of those schedules, but it gives every other coastal manager a public number to point to when cable consortia and cloud operators come asking why their state is still working off a 2001 application fee.

The Department of State Lands' rulemaking comment period runs through the end of July 2026. If the per-foot structure is adopted on the current timeline, the new schedule would take effect for any cable that has not already been approved before the rule's effective date. The next test case is the next transpacific cable on the planning slate: if it chooses Oregon, the state will know whether the price was set right.