TABLE 7.-Estimated and projected average annual number of persons reaching NOTE: All of these people are now alive. They represent permanent additions to the number of the Nation's drivers. Source: "Current Population Reports Population Estimates," series P-25, No. 187, U.S. Department of Commerce, Bureau of the Census. TABLE 8.-Projection of highway trust fund assuming 5-percent growth in collection rates with ABC systems leveled off at $900 million [In millions of dollars] FISCAL YEAR RECEIPTS LESS REGULAR "ABC" ALLOCATIONS AVAILABLE FOR INTERSTATE SYSTEM 1 Includes $39,000,000 interest 1957 through 1960. NOTE.-Current estimated cost of Interstate System is $33,952,000,000. TABLE 9.—Cost of Federal aid highway construction is remaining stable Source: U.S. Department of Commerce, Bureau of Public Roads, BPR 59–9. 1 Includes completed projects authorized prior to July 1, 1956. U.S. Department of Commerce, Bureau of Public Roads, BPR-59-11. TABLE 11.-Short-term projection highway trust fund, assuming restoration of incorrectly imposed1 charges 1 At time of creation of the highway trust fund (70 Stat. 397) amounts were appropriated to it equivalent to stated percentages of particular taxes collected after June 30, 1956, and before July 1, 1972. Outstanding authorizations carried over from prior appropriations against the general fund of the Treasury, out of taxes credited in those years to the general fund, but on which work was not completed were charged against the highway trust fund to the amount of $1,980 million. 2 At 5 percent rate of growth annually (table 8). Balance in the fund at June 30, 1959 (H. Doc. 92, 86th Cong., 1st sess.). Hon. WILBUR D. MILLS, SAN FRANCISCO, CALIF., July 13, 1959. Chairman, House Ways and Means Committee, California State Chamber of Commerce desires to be recorded at the July 22 hearings as opposed to increased gasoline tax proposals. They are unnecessary, unneeded, and unjustified. JAMES MUSSATTI, General Manager, California State Chamber of Commerce. SALT LAKE CITY, UTAH, July 2, 1959. Hon. WILBUR D. MILLS, Chairman, Ways and Means Committee, We wish to go on record as petitioning the Congress to provide the funds necessary for carrying forward the highway construction program inasmuch as the highway construction industry, engineers, and planners are geared to carry the program forward. We understand unless special appropriation is made, shortages in the highway trust fund will prevent regular appropriations for fiscal years ending July 1, 1961, and July 1, 1962. We feel appropriations should be obtained from the general fund and not from additional taxes upon highway users. GUS P. BACKMAN, Secretary, Salt Lake City Chamber of Commerce. STATEMENT OF FRED H. SEXAUER, CHAIRMAN, NEW YORK STATE HIGHWAY USERS CONFERENCE, INC. Gentlemen, my name is Fred H. Sexauer. I am chairman of the New York State Highway Users Conference, Inc., a conference of organizations that represent the automotive trades, commercial buses, commercial travelers, distributors, farm organizations, petroleum organizations, and truck organizations. Among the purposes of our conference is that to promote sound public policies of highway use, development, safety, taxation, finance, and administration. The adoption of the program and policies of the conference require the ratification by all of the members. In other words, the program and policies of the conference are the result of the unanimous consent of its members. As basic principles of highway financing, the New York State Highway Users Conference maintains that: A. All revenues derived from motor vehicles should be used for highway purposes only and ear tagged for such purposes. B. In accomplishing this objective, current revenues derived from motor vehicles should be dealt with under a plan which will progressively bring to an end, within a reasonable time, any use of them for other than highway purposes. C. An impartial determination should be made as to the equitable sharing of highway costs by highway users and other beneficiaries of expenditures for streets, roads, and highways. NOTE. The term "highway purposes" as set forth in point A above is intended to include the cost of administering laws, providing for the collection of highway user taxes and fees, statutory refunds and adjustments provided therein, payment of highway obligations, cost of construction, reconstruction, snow removal, maintenance and repair of public highways and bridges, and expense of State enforcement of traffic laws. Under the terms of the Federal-Aid Highway and Highway Revenue Acts of 1956, the entire proceeds of the 3-cent-per-gallon Federal tax on motor fuels, together with certain specified percentages of the proceeds of various other Federal automotive excise taxes, are earmarked for the Federal highway trust fund established to finance the expanded highway program. The New York State Highway Users Conference urges: That there be no increase in present rates of the Federal automotive excise taxes (including the Federal tax on motor fuels) levied upon highway users and earmarked, in whole or in part, for the Federal highway trust fund. In accordance with the policies adopted by the New York State Highway Users Conference, Inc., I urge the honorable members of this committee to reject any proposal that includes an increase in the Federal gasoline tax. I thank you for your courtesy in granting me the opportunity to make this presentation. STATEMENT OF JAMES N. KEEFE, CHAIRMAN, MASSACHUSETTS HIGHWAY USERS CONFERENCE The Massachusetts Highway Users Conference respectfully requests that it be recorded as very strongly opposed to any further increase in existing rates of the Federal tax on motor fuels or any of the other Federal automotive excise taxes. The conference has taken this position, by unanimous vote of 24 statewide affiliated organizations representing virtually all segments of highway transportation and many thousands of owners and operators of motor vehicles of all types registered in Massachusetts. The official policy of the Massachusetts Highway Users Conference on this issue, as contained in its current printed program, is quoted as follows: "This Federal-Aid Highway Act of 1956 provides that the entire proceeds of the 3-cent-per-gallon Federal tax on motor fuels, as well as certain specific percentages of the proceeds of various other Federal automotive excise taxes, shall go into the Federal highway trust fund. "As a consequence, highway users at present are not only being required to pay for the entire cost of the expanded highway program, but are also contributing billions of dollars besides to the general fund via other levies on motor vehicles and parts which are not dedicated to the highway trust fund. "The Massachusetts Highway Users Conference therefore strongly recommends: "(1) That there should be no increases in existing rates of Federal automotive excise taxes levied upon highway users and dedicated, in whole or in part, to the Federal highway trust fund. "(2) That upon completion of the expanded Federal-State highway program, as provided in the Federal-Aid Highway Acts of 1956 and 1958, all Federal automotive excise taxes, plus the Federal highway use tax (on vehicles of more than 26,000 pounds) be forthwith repealed." In this connection, we think it well to point out that the Nation's highway users in addition to paying all of the $2 billion-a-year-plus in special taxes dedicated to the highway trust fund, as well as the $1.5 billion more per year in other automotive taxes still going into the general revenues-are also paying all the other kinds of taxes, both general and speecial, that all other citizens must pay to all levels of government. And we respectfully call attention to the fact that the Congress, seemingly recognizing the inequity of this situation, specifically provided, in section 210 of the Federal Highway Act of 1956, for a study to gather "information on the basis of which it may determine what taxes should be imposed by the United States, and in what amounts, in order to assure, insofar as practicable, an equitable distribution of the tax burden among the various classes of persons using the Federal-aid highways or otherwise deriving benefits from such highways." [Italic added.] The third progress report of this highway cost allocation study has been submitted to the Congress by the Secretary of Commerce and finds that "there exists a formidable array of direct and indirect benefits [again, italic added] resulting from Federal-aid highway improvements, in addition to benefits resulting from actual use of such highways *** What seems significant is that there are real and extensive beneficiary groups other than highway users as such, that reap the advantages of highway improvement; and that the total magnitude of these benefits is great." Because of the importance of the facts already developed by this study, and their essentiality to a fair determination by Congress of "an equitable distribution of the tax burden (of federally aided highways) among the various classes" of beneficiaries, we maintain that any further increase in Federal taxes on highway users should at least await the final report scheduled to be submitted on January 3, 1961. It is clear that any prior action would nullify, to a measurable degree, the results of this much-needed and long-awaited study. And while on the subject of the benefits derived from highways, we cannot overlook the fact that highways are vital to the defense of the country, as well as its economy; that it is for these reasons, among others, that Congress has always recognized the obliagtion of the Federal Government to contribute toward the cost of highways out of the general revenues. As to the defense aspect, it was Congress itself which designated the Interstate System as the "National System of Interstate and Defense Highways." Surely, in a matter of such magnitude and concern to the whole country as the pattern to be laid down for future financing of the Federal-aid highway program, Congress will be in no mood to act hastily or before it has obtained and had time to ponder carefully all essential data bearing upon the situation, including the final report of the highway cost allocation study. The present dilemma, though serious, does not, after all, constitute a crisis of such proportions as to preclude a satisfactory, temporary solution for the next year and a half, without increased taxes, pending submittal of the results of this study and the drafting of appropriate long-range plans of financing. Workable alternatives include the suspension of the Byrd amendment to the Federal-Aid Highway Act of 1956 and appropriations from general revenues. This could be done in the form "repayable advances," as authorized in the 1956 act itself, or in the form of short-term bonds chargeable against future receipts of the Federal highway trust fund. Hon. WILBUR D. MILLS, ALABAMA HIGHWAY USERS CONFERENCE, Chairman, House Ways and Means Committee, DEAR CONGRESSMAN MILLS: As chairman of the Alabama Highway Users Conference composed of some 28 highway user organizations throughout the State of Alabama, I respectfully express our organization's complete opposition to any Federal gasoline tax increases as proposed by H.R. 7963 and H.R. 7939. This organization has recently gone on record as being opposed to any increase in highway user taxes. We feel that other means of financing should be considered until such time as the highway financing study is completed. Thank you for your consideration of our viewpoint on this most important matter. Sincerely, J. ERNEST LAMBERT, Chairman, Alabama Highway Users Conference. STATEMENT PRESENTED BY HARRY J. COOL, SENIOR VICE PRESIDENT OF THE GEORGE HALL CORP. My name is Harry J. Cool. I am senior vice president of the George Hall Corp. which operates as a wholesale distributor of Standard Oil of California products throughout eight counties of northern New York, located in the Onondaga, St. Lawrence and Champlain Valleys. I am also president of the Empire State Petroleum Association, Inc., the only association of independent jobbers and distributors in the State of New York, representing that segment of the petroleum industry for the past 20 years. I am appearing before your committee in a dual capacity inasmuch as I am representing not only my company and its subsidiaries but I am also expressing the policy of our State association, the membership of which is composed of the majority of all jobbers and distributors in the State. Proposals to increase the present 3-cent Federal tax on gasoline are presently before your committee. Increases from 2 to 12 cents have been recommended. We have been told that an increase is necessary if the 41,000-mile interstate highway program is to continue without interruption. This year New York State increased its own gasoline tax to 6 cents. When we add to this the present Federal levy and think in terms of increasing this by an additional cent and a half, it seems to me we shall have come far along the road of pricing our product out of the market. I am not here to make an impassioned plea for the motorists, even though I am one myself, for I am certain you gentlemen have already heard from a number of highway-user groups throughout the country, who, I am sure, have had no hesitancy registering their opposition to a tax increase. However, may I state my firm belief that any increase in the Federal tax will adversely affect the economy of our State as well as that of the Nation. When the Highway Act of 1956 was passed, the estimate of its total cost over a 10-year period was approximately $27 billion. For a variety of reasons, we are told this original cost estimate has skyrocketed to a point where $40 billion or perhaps even $50 billion are held to be necessary to complete the program on schedule. It is indisputable that last year a billion and a half dollars from the total of $3.6 billion received from highway-user taxes were diverted to the general fund rather than being earmarked for the highway trust fund. I contend that if this money, which consists primarily of Federal excise taxes on |