ALABAMA FEDERATION OF WOMEN'S CLUBS, Hon. WILBUR D. MILLS, Chairman, House Ways and Means Committee, DEAR CONGRESSMAN MILLS: As president of the 30,000-member Alabama Federation of Women's Clubs, I respectfully express my organization's unqualified opposition to any Federal gasoline tax increase. Our federation is composed of approximately 600 clubs in most of Alabama's 67 counties. We realize from reading news stories that the interstate highway program as planned must be in difficulty; however, we feel this Federal project and others should stay within its income just as we do in running our households. Judging by the very high gasoline taxes we pay in Alabama, there must be billions collected to build highways. Therefore, we are absolutely against any more tax on gasoline, which item is a necessity to carrying out our home-schoolchurch-club activities. I am enclosing a copy of our press release sent to all Alabama newspapers and radio and TV stations. Thank you for whatever consideration you can give to the Alabama Federation of Women's Clubs stand on this vital matter. Very truly yours, THE ALABAMA Mrs. J. F. MCVAY, President, Alabama Federation of Women's Clubs. FEDERATION OF WOMEN'S CLUBS AGAINST ANY FEDERAL Mrs. J. F. McVay, Jackson, Ala., president of the Alabama Federation of Women's Clubs, said that members of the federation are unalterably opposed to any increase in gasoline taxes, Federal or otherwise. Mrs. McVay, who is leader of 30,000 clubwomen in Alabama, said that the present proposals to increase the Federal gasoline tax should be rejected by Congress because gasoline taxes already are cutting deeply into household budgets. "We pay our own expenses to and from our many federation meetings, and we object to having additional taxes taken from our limited personal funds." "A tax rise would undoubtedly contribute to higher costs for products delivered to our homes. Food costs would be among the first to go up since 89 percent of all farm produce is transported from farm to market by truck," Mrs. McVay said. She added that higher delivery costs for department store purchases, cleaning, fuel oil, and other necessities for the home would be sure to activate other price rises. "An increase in the gasoline tax would also contribute to school costs. More than 1 out of every 3 pupils in the United States travels to school by bus, while 500,000 students use private automobiles daily to reach classes. More expense every time the family car is used would be a certainty if the gasoline tax is increased since, in a recent survey, it was found that transportation costs were the third biggest item in all consumer spending. "In line with the General Federation of Women's Clubs the Alabama Federation at its board meeting in January passed unanimously a motion opposing any Federal tax increase on gasoline. We feel that special automotive taxes already paid by the motorist should be applied to the highway building program before additional burdens via higher taxes are placed upon the car owners. STATEMENT OF THE MICHIGAN READY MIXED CONCRETE ASSOCIATION ON PROPOSED 12 CENTS INCREASE IN THE GASOLINE TAX The Michigan Ready Mixed Concrete Association takes this opportunity to vigorously oppose any increase in the Federal gasoline tax at this time for the following reasons: HISTORY: Prior to 1956 when the President and others concerned explained this program to the people of the United States, it was reiterated time after time that everyone would benefit from the proposed highway program whether or not they were highway users; and it would have tremendous benefits from a national defense standpoint. The Michigan Ready Mixed Concrete Association concurs in those statements. The Federal highway program in 1956 was enacted, and in just 3 short years they are back in to tap the highway users some more. The Ready Mixed Concrete Association is not desirous of having the road program bogged down in any way; however, we would recommend one of the following alternate proposals for insuring the continuance of the long-range aspects of financing this highway program: 1. Recommendation No. 1, suspension of the so-called Byrd amendment; 2. Transferring monies from the general fund to the highway trust fund; 3. The issuance of a special class of bonds against the assets of the highway trust fund; 4. Extension of existing financing and construction periods; 5. As another possibility, it is my belief that the Congress possibly could change the formula on the State matching basis to require the States to put up more money to match the Federal money in order to keep this program going. Since it is recognized by the President of the United States and others concerned that everyone benefits from an accelerated road program, then let us all pay. Let's not saddle just the highway users for this privilege. It is my considered opinion that whether a person owns an automobile or not, if he is a consumer of products he benefits from good highways. We strongly urge this committee to reject any bill to increase the tax on the highway users. As we have stated above, there are other ways to continue our highway program. Submitted by, CARL S. BUCHANAN, Hon. WILBUR D. MILLS, Chairman, Committee on Ways and Means, WASHINGTON, D.C., July 24, 1959. DEAR MR. CHAIRMAN: I submit herein for the consideration of your committee my statement on the proposed increase in the Federal gasoline tax. I am a consulting engineer and economist who conducts highway financing studies for the States. I share the concern of the State Governors that further increases in the Federal gasoline tax will jeopardize State highway financing programs. As an alternative I urge the development of automotive excise taxes for Federal highway purposes. The States instituted the gasoline tax as a source of highway revenue some 40 years ago. Because it proved to be readily administrable and an effective measure of highway use it soon gained wide acceptance. Over the years it has developed into a major source of highway revenue for the States. Now, however, the Federal Government is encroaching upon and threatening to usurp this source of revenue. The Federal Government entered the gasoline tax field in the thirties with the adoption of a tax to provide depression revenues, then continued it throughout the war years to provide national defense revenues. In 1956 it increased the rate from 2 to 3 cents per gallon and earmarked the revenues for highway purposes. Enactment of these changes in the Federal tax has placed the Federal Government in competition with the States for this source of highway revenue. Enactment of the proposed increase of 12 cents, which would make the Federal tax 42 cents as against the average State tax of 5.6 cents, would stiffen that competition. In fact, as often happens when two levels of government compete for the same source of revenue, the higher level might well preempt it. Obviously the Congress has difficult and immediate problems to resolve in financing its new Interstate System, but the fact remains that the States have continuing problems of far greater magnitude in financing their portion of the Nation's highways. In terms of traffic, the Interstate System is expected to carry only some 20 percent of total traffic, whereas other systems of highways, roads, and streets must carry the preponderant 80 percent of total traffic. The Federal Government has assumed on the Interstate System 90 percent of the construction cost, and on other federally aided highways, 50 percent of that cost; but it has left to the States construction costs of 10 percent on the Interstate System, 50 percent on Federal-aid highways, and 100 percent on all other highways. It has also left to the States the entire cost of maintenance on the Interstate System and all other systems of highways, roads, and streets. I would urge, therefore, that the Congress not encroach further upon the States' established source of highway revenue without looking carefully into the possibility of a source of revenue not readily available to the States. The 44357-59-29 one which I would suggest is a manufacturers' excise tax on motor vehicles and automotive products. The Federal Government has the beginning of such a tax in its excise tax on tires now earmarked for highway purposes. An excise tax on motor vehicles would impose the increased highway burden upon the automotive industry rather than upon the heavily burdened petroleum industry and thereby broaden the highway taxation base. Furthermore, the incidence of such a tax would be in large part on buyers of new cars who have a relatively high ability-to-pay in relation to buyers of used cars. My specific recommendations are as follows: 1. That the Congress reject outright the proposed increase in the Federal tax on gasoline and declare its intention to leave to the States any future increases in the rates of motor fuel taxation for their highway purposes. 2. That if additional revenues are necessary for Federal highway purposes, the Congress increase the manufacturers' excise tax on motor vehicles and possibly other automotive products and earmark the revenues for such purposes. Respectfully yours, BERTRAM H. LINDMAN. Mr. LEO H. IRWIN, CONSULTING ENGINEERS COUNCIL OF MARYLAND, INC., Chief Counsel, Committee on Ways and Means, DEAR SIR: The following statement is submitted on behalf of the Consulting Engineers Council of Maryland for inclusion in the record of hearings on methods of financing the expanded Federal-State highway program being held by the House Committee on Ways and Means. "During the various committee hearings, prior to the passage of the Federal Highway Act of 1956, it was evident that all segments of our economy and the general public recognized the need for a sound national highway program to effect a reduction in the highway accident and fatality rates, to return the economic benefits to industry and commerce which are possible only with adequate highways, and to provide a national highway system needed for national defense. It was also evident that there would be sufficient engineering manpower, materials, construction equipment, and construction forces to execute such a program. "In the act of 1956 the Congress clearly stated its intent to carry out the program, including_the_completion of the Interstate and Defense Highway System, by 1972. The Bureau of Public Roads, the various State highway departments, consulting engineers, materials producers, equipment manufacturers, contractors, and all other segments of the highway industry have geared themselves to this level of production. "The need for the construction of the Interstate System in accordance with the original schedule has not changed. "It is the view of the Consulting Engineers Council of Maryland that the present session of the Congress has an obligation to find some means to overcome the temporary deficit in the highway trust fund in order to make possible the apportionments to the States for fiscal 1961 and 1962 at the levels proposed by Representative George H. Fallon, chairman of the House Subcommittee on Roads. "It is our opinion that the economic loss which would result from failure to make up this deficit, makes any stretch out of the program unthinkable. "Cut-backs and interruptions at this time will seriously hinder sufficient planning and construction of the program. All deferred construction will add to the overall cost of the program. "Highway department and consulting engineering organizations, by gradually expanding their staffs, have now developed qualified organizations for handling the engineering phases of this program. A retrenchment in the program now will force a reduction in these staffs and break down these efficient organizations. "Consulting engineers have also cooperated in a national effort to interest more young men entering college to take courses leading to a career in engineering. This effort to bring new talent into the highway engineering field cannot succeed if prospective engineers loose faith in the continuity of the highway program. "The Consulting Engineers Council believes that some compromise interim financing program can be devised at this time. The council also believes that some increase in the Federal gasoline tax as a pay-as-you-go measure appears desirable to help make up part of this deficit. "It is our view, furthermore, that no reappraisal of the overall financing of the program should be undertaken until 1961, when the Congress will have new cost estimates and a report on benefits and beneficiaries of the highway program from the Bureau of Public Roads. "The effect of the present condition of the highway trust fund is already being reflected in delay and confusion in the execution of the highway program in the various States. We earnestly request that the Committee on Ways and Means move expeditiously toward an early solution of the dilemma created by this deficit in the highway trust fund by taking whatever action necessary to put the Federal highway program back on schedule." Sincerely yours, WM. G. ROBERTSON, Jr., President. AMERICAN BAKERS ASSOCIATION, Hon. WILBUR D. MILLS, Chairman, House Ways and Means Committee, DEAR CONGRESSMAN MILLS: In connection with the hearings now being held by the House Ways and Means Committee, relative to a proposal to increase the Federal motor-fuel tax, may I respectfully bring to the attention of the committee the policy position of the American Bakers Association. This association is the national trade association of the wholesale and home-service baking industry, which operates in excess of 100,000 trucks on the highways of the Nation. The American Bakers Association is opposed to any tax increase at this time, believing that our membership is already incurring more than its fair share of the support of the financing of the program. A relatively small percentage of our trucks uses the Interstate System, since most of our deliveries are made in the urban and suburban areas operating in approximately a 50-mile radius from the plant. We strongly supported the enactment of the Highway Act of 1956 and the various automotive tax increases imposed then, including the 1%-cents per gallon Federal gasoline tax, in the hope that the improved highway system would be an effective step in reducing our distribution costs insofar as the operation of motor vehicles is concerned. At the same time we were aware that the program would have periods of temporary deficits in the early years of construction which, it was anticipated under the legislation as originally passed by the House, would be met by repayable advances from the Treasury of the United States, chargeable against future trust fund receipts. Such a method of financing was considered practical inasmuch as specific future tax receipts were earmarked for the construction of the Interstate System. Unfortunately, the restrictions of the Byrd amendment, added by the Senate, negated such financing. Nonetheless, in our considered opinion, this method of meeting temporary deficits in the construction of the system, still appears eminently sound, and we would urge your committee to recommend some such approach in preference to any increase in the Federal gasoline tax. It is noted that the proposed increase in the gasoline tax, has been referred to in official quarters as a temporary increase to terminate in 2 years' time. The experience of history bespeaks otherwise. Taxes which in the past have been labeled as "temporary" and "for a limited specific purpose" have invariably managed to become a permanent part of our tax structure. It is understandable, therefore, that we view with extreme skepticism any promise as to the "temporary" nature of the proposed increase. As a further point, traditionally and logically, gasoline taxes have been reserved to the several States, except for the temporary emergency wartime tax and the 12-cents tax for the construction of the Interstate Highway System. We believe there should be no further encroachment on this taxing area of the States, many of which are already in dire need of additional revenues. Also we would urge the committee at this time to confine its deliberations to a resolution of the problem of the temporary deficit covering the apportionments through 1961, since those apportionments must be made within the next few months to maintain continuity of the program of its scheduled rate of construction. As your committee is, of course, aware, the study provided for by section 210 of the 1956 Highway Act will be available to Congress in January 1961, which study will permit sounder and more thorough consideration of the necessary long-term financing of the program. In summary, therefore, we are opposed to any increase in the Federal gasoline tax. Temporary deficits should be financed through some method of repayable advances chargeable against the trust fund receipts, and consideration of the long-range problem of financing should be deferred until completion of the section 210 study. Sincerely, Hon. W. D. MILLS, JOSEPH M. CREED, Counsel. INDIANA BAKERS ASSOCIATION, House Office Building, Washington, D.C. DEAR MR. MILLS: In behalf of our membership we are protesting any increase in the Federal gas tax and instead we urge Congress to use all automotive excise taxes for highways. Our industry is a big user of gasoline and now pay into the millions for gas taxes, both State and Federal. We would appreciate, if possible, that this protest be made a matter of committee record. Thanking you in advance. JOHN S. CLARK, President. CHAMBER OF COMMERCE OF THE UNITED STATES, Hon. WILBUR D. MILLS, Chairman, House Ways and Means Committee, DEAR MR. MILLS:The national chamber has supported the expanded highway construction program on the Interstate System, authorized by the Highway Act of 1956, since its inception. We are convinced that the program is needed to remedy serious deficiencies in the Nation's highways important to interstate commerce and national security. This position was arrived at through a national referendum of the membership in 1956 during consideration of legislation that resulted in the 1956 Highway Act. The chamber believes that the pay-as-you-go principle established in the act is sound and should be maintained. Otherwise, the possibility of balanced Federal budgets for 1960-62 will be seriously jeopardized. As it now stands, the highway trust fund, which supplies the money for Federal highway aid, will be short about $500 million in the current fiscal year, and over $2 billion for each of the fiscal years 1961 and 1962. This is a temporary situation which will be taken into account in a scheduled comprehensive review of the entire highway program due by the spring of 1961. At that time Congress will have available to it detailed official studies which will permit a more accurate determination of beneficiary responsibility for the costs and a more equitable tax plan will thus be possible. The recommendation we are making, therefore, is designed only as a solution of the temporary situation. The board of directors of the chamber recently gave thorough consideration, in light of the policy established by the membership, to the situation facing the highway trust fund and the alternative methods of financing the anticipated deficiency for the next few years. Repayable advances to the trust fund from the general fund were rejected because they would mean deficit financing. The issuance of a special class of bonds against the assets of the highway trust fund was similarly rejected because that, too, would mean an increase in the national debt. With an objective of continuing the program on the Interstate System and at the same time promoting sound fiscal policies, our board recommends that taxes now assigned to the trust fund be increased, with a definite terminal date, |