Mr. LEAVITT. Yes, sir.

Mr. BRAND. What if other States come to us with the same proposition?

Mr. LEAVITT. This only applies to States with a scant population. I think our difficulty is that we get off very often from the main subject. I know we do in the committees I belong to. We are not presenting this as a Montana issue. I simply started here to illustrate the necessity for this measure and want to present the situation in Montana. Montana can not construct its transcontinental highway system that is a national need, not a State need. Do not misunderstand me. It has a certain State value, for all of the land on the national highway will probably have some State value. I notice here in these thickly populated States like Indiana, Ohio, and Illinois, that they have just as many north and south roads as they have east and west roads. But they have very little to do with national travel to points that have been set aside by the Nation, but they have more local value in proportion to their mileage than this transcontinental highway can have, because of scant population and because they can not travel over it. They can go in eastern Montana and ship their cars. The situation out there is not so that people can use their cars very much in traveling. The transcontinental travel out there is national rather than State, and the need for hurrying the project is national rather than State, and then we have between the national boundary and Mexican boundary a similar situation.

If we want to build across those thinly populated States, some of them where there are less than four to a square mile; like Arizona, with even less, and Nevada with still even less, if we are going to get them constructed within a reasonable number of years, you have got to allow the use of the Federal money, not any more of it. I think we could have made some argument to ask for some money that the State did not have to meet, but we have not asked for that. We have simply asked in those thinly populated States where the population is less than 10 to the square mile, and taking the area as a whole, it is very large, where the State is not in a position to advance this money on a national highway-not State highway system_but national highway system-that they could afford to use on those parts of the transcontinental highway in those States all of the Federal funds until these States are able to meet it.

Down in Utah they have a much smaller proportion than we have in Montana to meet. We have to meet as much of it as the people in thickly populated States, and so it is down in Iowa they would have to meet so much of it. The travel through those sections on those highways is more by people outside the States than by people within the States, on most any of those roads. Of course any national highway is used more than a local road, because they run where there would be use for them if there were no national travel. Of course in some cases the situation has already been met with funds raised with local assistance.

The whole thing simmers down to where we do not want to delay the building of these national highways until the States are able to come back and build in the normal way, or until the situation is extended

Mr. HUDSPETH. Have you ever had a State bond issue in your State for highways?

Mr. LEAVITT. Not for highways.

Yesterday I got hold of a tabulation which shows the situation with reference to the Federal land banks and Montana, and I am frank to say did not show up very well from a financial standpoint. It is all right for us to argue here in Washington about what we' ought to do in those States, but the thing that we are up against in those States is the situation that exists, and that situation is such that we can not pass, with delinquent taxes, etc., already on the books, any bond issue at this time. Our only resource for highway funds is going to be from gasoline tax and the automobile license tax, I think, for a considerable number of years, and we have had to take care of our State highway fund from that. We can not put that all into the State at the present time.

I do not want to put anything into the record that would be bad. advertising for those Western States, but the situation is this: They can not go ahead with the use of the Federal money unless they can use Federal aid up to 100 per cent, like the road through the Great Divide, where it will be years before the States can match it, and especially where roads have been built from the East to the West, and it needs the patching up.

Unless this is done, the people from the East who wish to go West across the country and the people in the West who wish to go East are going to be held up.

Mr. BRAND. Is there any difference in the bonded indebtedness of the State of Montana and other States in the Northwest?

Mr. LEAVITT. I do not understand that the State of Montana is up to its limit.

The CHAIRMAN. Do you believe that your people in that condition ought to have further burdens put upon them to make roads for the transcontinental route you are talking about?

Mr. LEAVITT. Not morally so.

The CHAIRMAN. Do you not believe that these people ought, in some way, to help pay for these national highways?

Mr. LEAVITT. Yes, and they will by a gasoline tax.

Mr. DOUGHTON. Where it is a national need and not a local need, why would it not be right for the Federal Government to raise this money instead of leaving it to the State to finance it?

Mr. LEAVITT. Well, we would be very glad to have them do that, but every road of national need has some local need. I hope the time will come when the National Government will construct a highway system that the States and local governments will have no part in the construction of, and the maintenance of.

I do not want to write that into this bill, but it is the intention of all those States to go right through with the road program as fast as it can be done, but want to get in advance the right to use this money. As Mr. Colton said, the idea did not originate in those Western States. We have been urged for years to build good roads and we could not do it, as far as the needs of the nation go. seems to be the only way it can be done. The CHAIRMAN. Mr. Hayden will be heard. Mr. HAYDEN. Very briefly.

This

STATEMENT OF HON. CARL HAYDEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ARIZONA

Mr. HAYDEN. The situation as presented to you is that authority of law is asked in this bill whereby when an agreement is reached between the Office of Public Roads and the State highway commission in any of these States, having a small population, as designated in the bill, that 100 per cent Federal aid may be extended out of the allotment to that State on any particular section of a transcontinental highway passing through the State.

In other words, it is not proposed that any of these Western States needing this relief shall receive one cent more out of the Federal aid than they otherwise would. It merely removes the requirement that they match that fund in any particular, if they are not able to do so that to be ascertained by conference between the State highway officials and the Office of Public Roads.

Of course the Office of Public Roads wants as much money apent on any road as possible, and in their opinion if the State has the ability or in any way can add to its quota sum for the construction of this continental road, it should be done. Or where there is no way of the State getting money to match Federal money on that particular piece of road, or not getting enough, they may expend such sum as may be agreed upon between the two authorities.

Mr. HUDSPETH. This bill does not take one dollar away from the quota of any other State, does it?

Mr. HAYDEN. Not a dollar. Right through the corner of the State of Arizona is what is known as the old Spanish Trail Highway. In serving the State of Utah, that road passes down through a populous section of the State, going into a populous section of the State of California, but where it passes through Arizona and Nevada it is practically a desert, and practically no residents would use it. There is not one citizen of my State out of a thousand that would ever pass over that road, in that section of the State.

The CHAIRMAN. But that road is necessary to join up the road in either State? That link across your State must be built in order for that road to be used?

Mr. HAYDEN. Unless you fix up that road there and connect up with it, and pave the road, it will be impassable in certain seasons of the year. If the people on the Pacific coast desire to go East or the people in the East desire to go to the Pacific coast and use that road, they can not pass. We have bonded our country to the limit. We have suffered from the general depression that is existing over the United States. We simply can not get the money where we can do that work. If we could raise that money the people of the State as taxpayers, would say, "Let us put it somewhere, on some other road in Arizona where it will do our people good." And in the situation, therefore, before matching Federal funds in a situation of that kind, Congress ought to agree to it.

Mr. NELSON. In other words, your idea is that to help transcontinental travel you are willing to sacrifice some local advantage for the good of transcontinental travel?

Mr. HAYDEN. Yes; it is a distinct sacrifice, if by spending a lot of money for cross-country roads we are willing to forego the advantage we would get by building State roads, and the Congress ought to be

willing to take advantage of our proposition. There seems to be no objection from any other section of the United States to the enactment of this provision.

Mr. COLTON. That particular section of your State is removed from the other section of your State by the Grand Canyon, is it not?

Mr. HAYDEN. Yes. The same way as other transcontinental roads, where you pass through miles and miles of desert and there is no local travel.

The CHAIRMAN. How are you raising your funds?

Mr. HAYDEN. We have a state road fund levy on all taxable property in the State. That road money is so raised that a portion of it is expended by the State highway department, and the other portion is allotted to the counties of the State. But the money itself comes from a State tax levy, and in addition to that several counties or road districts have voted money, and the road, where it was possible

Mr. ROBSION. You have a State fund where you can match Federal funds?

Mr. HAYDEN. Yes, sir. But where that State fund is not large enough-as it is not usually-the counties vote bonds and take the money and turn it over to the State authorities so that it would get into the State fund, and thereby be made available to match Federal funds.

Mr. ROBSION. Are you building some other highways in your State? Mr. HAYDEN. Yes, sir; what is known as the National Highway, extending across the northern part of the State, three or four hundred miles; then the Bankhead Highway and several others.

There are several other roads crossing the southern part of Arizona. We have taxed ourselves to build miles and miles of roads where there is no property.

Mr. ROBSION. What per cent does your State get?

Mr. HAYDEN. My recollection is 67 per cent Federal aid and 33 per cent from the State, due to the fact we have a large area of public lands. We feel we were cheated in that regard, in that, in making the apportionment, no account was taken of the Indian lands of the State. I would like to bring that to the committee's attention at another time.

Mr. BRAND. Most of your funds come from bonding the counties, do they not?

Mr. HAYDEN. We have had to do that. We have a very small proportion of taxable property compared with other States. We have a population of only 330,000.

Mr. BRAND. When that is done they want the road built in that county, do they not?

Mr. HAYDEN. That is it. You could not ask the local taxpayers to build

Mr. BRAND. That is the reason we are having trouble with these roads?

Mr. HAYDEN. Yes, sir. You could hardly ask a local taxpayer to tax himself and pay for bonds to build roads where he would never use them.

Mr. BRAND. Do you not think we are coming to the place where we are going to have to let the State furnish the money?

Mr. HAYDEN. My State does.

Mr. BRAND. You go out into the counties and get it.

Mr. HAYDEN. Well, we do, but we do have a State levy to raise the money.

Mr. BRAND. But you do not have a staff, do you?

Mr. HAYDEN. We pay all we can. We have never issued State road bonds, but there is a limitation of our State constitution that has prohibited that, and I think very wisely in view of the way in which funds have been issued in some instances, to such an extent that the taxpayers can not stand the burden of the time and per cent.

Mr. BRAND. Do you think it would be different as between the county and the State?

Mr. HAYDEN. One is the same as the other.

Mr. BRAND. Only you do not get the money?

Mr. HAYDEN. That is it. But we have adopted a gasoline tax and a license fee. We are raising practically sufficient funds to take care of the maintenance of the roads.

Mr. BRAND. You have a State road tax, have you not?

Mr. HAYDEN. Yes; but that is nothing to compare with the gasoline tax.

Mr. BRAND. If the State wants to build roads does it issue bonds? Mr. HAYDEN. If it so happens that the county is building a road and it happens to dovetail with the State highway system, it gets the money. If it does not, you can not compel them.

The CHAIRMAN. Mr. Sutherland of Alaska and others are here and want to make a statement with reference to this section. Can you complete your statement in 30 minutes?

Mr. SUTHERLAND. Certainly, unless you interrupt me considerably. The CHAIRMAN. Are there any other gentlemen here who wish to be heard on Mr. Colton's bill?

Mr. COLTON. No, I think not unless the committee desires to hear from the chief of the bureau. I would be glad for him to be heard. The CHAIRMAN We will hear him on it later.

The CHAIRMAN. Mr. Sutherland, the Delegate from Alaska is here and desires to be heard for a few minutes on the situation in Alaska.

STATEMENT OF HON. DAN SUTHERLAND, A DELEGATE FROM THE TERRITORY OF ALASKA

Mr. SUTHERLAND. The bill on which I desire to be heard is H. R. 3232, on the subject of Federal roads. This is a bill I introduced last session. The American Road Builders, assembled in Chicago, in January, 1922, and again in January, 1923, passed a resolution urging Congress to extend this act to Alaska.

The bill has also been indorsed by the Chamber of Commerce of Seattle, Wash., and the Chamber of Commerce of Portland, Oreg. I speak particularly of those indorsements for the reason that the Federal tax that would naturally be paid by Alaska is paid by Seattle, Portland, San Francisco, and New York. To illustrate what I mean, one man in Alaska a few years ago paid an income tax or a territorial tax on a mine of 1 per cent on the net earnings for the year, and that amounted to $218,000. In other words, they paid a tax on a net income, or practically $22,000,000, for one year on a mine. That tax, of course, was paid in the State of New York, and the greater portion of the taxes from the Territory are paid in