I wish I could bring before you the persons who have contacted Mr. James B. Bledsoe, executive secretary of the Portland Coast Columbia District Council of Lumber and Sawmill Workers, has asked that some way be found to continue the financing of the Federal highway construction program before this Congress adjourns. I certainly agree.

It has been proposed that to implement this fine national program an increase in the Federal gasoline tax may be necessary. I am reluctant to see these taxes increased. However, if this committee find such a move necessary, I hope this sort of legislation will reach the floor as soon as possible for favorable action.

We all are aware of the tax burden we share at this time. But I feel that no one wishes to impede a program which is so vital to our State and national welfare.

As Oregon's road construction program is postponed because of the lack of Federal matching funds so are the programs in other States. Perhaps not right now, because I understand my State is ahead of most others in its programing. But what has happened in Oregon will be repeated unless the Congress takes measures to solve the problem.

We strive to have full employment. Yet this situation is making idle large segments of the construction industry. If the valuable summer months are lost we can expect higher costs during the rain and snow of winter months. Let us build during optimum conditions— right now.

Throughout the Fourth Congressional District, which I have the honor to represent, men and women look toward Congress for leadership in correcting this problem. One editor in my district, Chales V. Stanton of the Roseburg News-Review, has stated:

It is my own theory that the motorist more than saves the cost of good highways by lowered gasoline use, wear and tear on his vehicle, reduction in time and other savings. Thereby he can well afford the small tax involved in a pay-as-yougo proposal.

I know that views on this subject cover the entire spectrum. There is no single solution. However, I do advocate that this committee take steps to solve a problem which can be injurious to our national welfare. Our highway system is of vital importance. Its construction should be continued immediately.

Mr. Chairman, I thank you for the opportunity of presenting my views to your committee.

The CHAIRMAN. Thank you, Mr. Porter, for coming to us and giving us your views on this subject.

Mr. PORTER. Thank you, Mr. Chairman.

The CHAIRMAN. We will now hear from our colleague, the Honorable Daniel B. Brewster from the State of Maryland. We are happy to welcome you, Mr. Brewster.

STATEMENT OF REPRESENTATIVE DANIEL B. BREWSTER, OF

MARYLAND

Mr. BREWSTER. Thank you, Mr. Chairman.

Mr. Chairman and members of the Ways and Means Committee, I appear before you today to protest the diversion of Federal automotive excises paid by the motorists, but which now go to the general

fund. It is my understanding from a hurried study of the Federal automotive tax field that all the revenue from the 10-percent Federal automotive excise tax; the 8 percent tax on accessories and parts; and, one-half of the 10 percent levy on trucks and buses go into the general fund and not into the highway trust fund.

Diversion of motor vehicle revenue has always been the greatest threat to a successful highway program. In my State of Maryland, during the depression, huge sums of motor vehicle revenue were diverted to the general fund, and as a result the construction_and_reconstruction of our highways came almost to a complete halt. But diversion of motor vehicle revenue was stopped in Maryland, and thus we were able to embark on an ambitious highway improvement program.

As a member of the House of Delegates of the General Assembly of Maryland, it was my privilege to vote for a constitutional amendment dedicating all automotive excise taxes to highways. I am told that 27 States now have such a provision in their constitutions.

It is my understanding that the motorists of this country last year paid $3.6 billion in Federal automotive excise taxes. But only $2.1 billion went into the highway trust fund, $1.5 billion going into the general fund. Thus, if the Federal Government would stop its practice of diversion of Federal automotive excise taxes, the financial problem confronting the Ways and Means Committee of funds for highways would be solved.

The CHAIRMAN. Thank you, Mr. Brewster, for coming to us and giving us your views on this subject.

Mr. BREWSTER. Thank you, Mr. Chairman.

The CHAIRMAN. We will now hear from our colleague, the Honorable Thomas F. Johnson, from the State of Maryland. We are happy to welcome you, Mr. Johnson.

STATEMENT OF REPRESENTATIVE THOMAS F. JOHNSON, OF

MARYLAND

Mr. JOHNSON. Thank you, Mr. Chairman.

Mr. Chairman, as representative from the First District of the State of Maryland, I wish to protest the proposal to increase the Federal gasoline tax from 3 to 42 cents.

Historically, the gasoline tax was first levied in 1919 in the State of Oregon. Not until 1932 did the Federal Government enter this tax field when it levied a 1-cent tax to meet an emergency. When the tax was increased because of wartime conditions, these increases were considered temporary and when the emergency passed, it was expected that they would be reduced. Then the Highway Act of 1956 made them permanent. Now we are confronted with a 50 percent increase in the rate to finance the Interstate Highway System.

The First Congressional District of Maryland that I have the honor to represent consists of nine counties on the Eastern Shore of Maryland. But in eight of those nine counties, there is not a single inch of the Interstate System. Nevertheless, the highway users in those counties would pay the 42 cents Federal tax without any benefits whatsoever.

The district I represent is largely agricultural. Gasoline taxes are a real burden to the farmers who must truck their produce to markets and represents a substantial part of the expenses of farming. Also, the farmer who must truck his produce to the market 100 miles necessarily pays gasoline taxes in an amount 10 times more than the farmer who is only 10 miles from the market.

Many of my constituents earn their living along the great Chesapeake Bay by furnishing watercraft to fishing parties. In this instant also, the Federal gasoline taxes paid by this group of hard-working people represents a substantial sum of money. And to increase this burden by 50 percent means that you are reducing their lean profits. In conclusion, I wish to reiterate my opposition to an increase of 50 percent in the Federal gasoline tax.

The CHAIRMAN. Thank you, Mr. Johnson, for coming to us and giving us you views on this subject.

Mr. JOHNSON. Thank you, Mr. Chairman.

The CHAIRMAN. We will now hear from our colleague, the Honorable Frank Kowalski, from the State of Connecticut. We are happy to welcome you, Mr. Kowalski.

STATEMENT BY REPRESENTATIVE FRANK KOWALSKI, OF CONNECTICUT

Mr. KOWALSKI. Thank you, Mr. Chairman.

Mr. Chairman and members of the committee; I am strongly opposed to the President's recommendation for a 50-percent increase in the Federal gasoline tax.

Such an increase cannot be justified while 42 cents out of every automotive tax dollar collected by the Federal Government is diverted to nonhighway purposes.

In the year 1957 the Federal Government collected $51.8 million in automotive taxes from Connecticut highway users. An increase of even 1 cent a gallon in the Federal tax, one-half cent less than proposed by the President, would cost the people of my State an additional $7.6 million a year.

Highway users in the United States are paying an average State tax of 6 cents per gallon in addition to the present Federal levy of 3 cents. This amounts to a 41 percent sales tax on every gallon of gasoline. The average State tax plus the Federal tax means a 90cent tax on every 10 gallons of gasoline purchased.

If Congress allows continued diversion of automotive taxes and places the entire responsibility for the highway program on the gasoline tax, it will be necessary by 1963 to have a Federal gasoline tax of 7 cents a gallon. This, added to the average State tax, would mean a combined national tax of 13 cents a gallon-which would amount to 113 percent of the refinery price, 78 percent of the tank wagon price, and 59 percent of the average retail price.

The CHAIRMAN. Thank you, Mr. Kowalski, for coming to us and giving us your views on this subject.

Mr. KOWALSKI. Thank you, Mr. Chairman.

The CHAIRMAN. We will now hear from our colleague, the Honorable Donald F. McGinley, from the State of Nebraska. We are happy to welcome you, Mr. McGinley.

STATEMENT OF REPRESENTATIVE DONALD F. McGINLEY, OF

NEBRASKA

Mr. MCGINLEY. Thank you, Mr. Chairman.

Mr. Chairman, the problems incident to the financing of the Federal highway program are of dual importance to me: First, as a Member of the House of Representatives, we must find the solution and, second, because my State of Nebraska is embarking on a 400-mile sector of interstate highway construction.

I think that at the outset it would be well to set some guidelines inside of which, in my thinking, the problem areas lie and the answers are to be found.

(1) While a pay-as-you-go amendment was added to the Federal highway program act, I do not believe that the committee, as this program was first visualized, thought that this was of paramount consideration. The fact that, because of economic conditions, this provision was set aside is reason enough to allow this legislative body to consider an answer to the present problem without inflexible restraint by this provision. As a matter of fact, the deviation from this principle during the time of recent economic crisis has created much of the present situation and further departure should only be considered a part of the original action.

(2) The suggestion of obtaining a greater percentage of the excise taxes collected from automobiles and accessories is, to me, an indirect method of taking the necessary moneys from the general fund. This is because the void of revenues, which are now being used to finance programs, caused by diverting of these funds would necessitate these programs to go to the only other source available—that is, the general fund.

Taking these two areas into consideration, I feel that the most logical method of making up the deficits in the Federal highway program fund is to go directly to the general fund.

Two other points I think should be made here. One is a local situation with me and the other, a general statement which I would classify an axiom of the times.

The general statement is that the road program must be advanced at its originally planned pace both because of the need and because of the false economy that would result in delay. Costs continue to rise which would alone result in eventual higher cost of road construction if delayed. The energies of many State highway departments have been channeled into the Federal highway program planning and staffs and work schedules are based on the presumption that this program will advance as proposed.

The local situation as regards Nebraska is that gasoline tax has been used as a primary source of revenue and that further increase would meet with serious opposition within the State. Nebraska now has 7 cents of State gasoline tax.

The idea of pay as you go is commendable but is worthy only as far as it is workable. Beyond that it must not become a sacred cow.

The second idea that highway costs should be financed by direct use tax is fine up to a point. But the obvious benefits to be derived both on a primary and secondary level would justify-if not demand-other financial aid. I refer here to the use of the Federal highway system

for defense. In Nebraska, for example, the interstate highway is expected to increase traffic across the State 70 percent or more. Certainly the direct benefits to restaurants, hotels, and motels, in addition to service stations, will be a factor. Perhaps this added transportation facility will permit location of additional industry in our State and generally result in higher property values.

The safety factor of modern, controlled access highways to accommodate people who will be traveling could certainly be estimated in terms of saved lives, heartaches, and material expenses.

In conclusion, I cannot encourage this committee too strongly to take whatever steps it must to keep this highway program going. I know that the chairman and his committee possess the ability and courage to develop a workable solution to this present problem.

The CHAIRMAN. Thank you, Mr. McGinley for coming to us and giving us your views on this subject.

Mr. MCGINLEY. Thank you, Mr. Chairman.

The CHAIRMAN. We will now hear from our colleague, the Honorable Thomas G. Morris, from the State of New Mexico. We are happy to welcome you, Mr. Morris.

STATEMENT OF REPRESENTATIVE THOMAS G. MORRIS, OF NEW MEXICO

Mr. MORRIS. Thank you, Mr. Chairman.

It is a pleasure to appear before this committee to present my views on possible methods of bolstering the financial resources of the Federal highway trust fund.

Since the initiation of the current Interstate Highway program years ago, we have seen tremendous strides in financing and construction of various segments of our proposed 41,000 miles of highway network. This advanced system of highways will reduce the grave toll of lives taken on many of our present death-ridden highways. The statistics on the minimization of the death rate on controlled-access highways has indeed been impressive. To use a geographically close illustration, safety reports show that the Shirley Highway in Virginia has a fatality rate of 0.8 deaths per 100 million vehicle-miles as compared with a death rate of 10.6 on parallel U.S. No. 1. Other modern highways such as the Baltimore-Washington Parkway-Expressway and others have similarly fine records as compared to older roads from which they have diverted most through traffic. It has been conservatively estimated that the Interstate Highway System will result in reductions of $1.4 billion in annual highway accident costs. The current highway program also continues Federal aid for the long-supported program of construction and improvement of primary, secondary, and urban roads.

As to the financial benefits already being derived by individuals and businesses as a result of the current highway program, we will not have a complete picture until 1961. At that time the U.S. Department of Commerce is required to present to Congress a report which will include comprehensive information on direct and indirect beneficiaries of the program. We do, however, already know that the program has induced a high level of activity in many industries such as the roadbuilding machine industry and suppliers of roadbuilding materials, only to mention a few.