The CHAIRMAN. Now, Mr. MacDonald, I want to ask you this question: You would not need these funds only they are allotted to many of the States that do not take advantage of them? Mr. MACDONALD. Yes; we would need them, Mr. Chairman. Allowing the same amount of money to go under contract this year, as we have been placing under contract for three years, next year if a $50,000,000 appropriation is made there will be a number of the States that will not have enough of the Federal allotment to carry on as large a program as they have carried on in the past. According to our estimates there will be at least 12 or 13 such States. Mr. DOUGHTON. Right there, Mr. Director, is not that a considerable backward step for the Government to take? I believe in 1921 we had $100,000,000 ; and for this fiscal year, 1922, $75,000,000; and next year to go back to $50,000,000, do you not think that that would create an unfavorable impression upon the country as to the attitude of Congress in this matter of aiding in building roads? Mr. CABLE. Where are you going to get the cash? Mr. SEARS. You have got $600,000,000 for some purposes. Mr. MACDONALD. We have had some accumulation of funds from the past years. Mr. LARSEN. If I understand you, that will not suffice to meet the demands of all of the States? Mr. MACDONALD. No, sir. Mr. LARSEN. What States will it fail to meet the demands of; do you know? Mr. MACDONALD. Yes; I can give you that. I may say that our estimates, I believe, are very conservative. They do not allow as large a program as the States say they will be able to carry on. We are basing our program entirely on what has been done in the past. The CHAIRMAN. Mr. Director, allow me to ask you a question right there that has been bothering me. Last year, when we had our hearings, we had very exhaustive testimony given on the road question, and almost every one who testified hazarded the opinion that all the money would be used up by the end of the year. Now, we have $120,000,000 left of that former appropriation, exclusive of the $75,000,000 passed last year. How do you account for the fact that there is $120,000,000 yet of that 1916 appropriation that is not used? It is possibly allotted; but I mean that is dormant money, most of it, is it not? Mr. MACDONALD. No; I would not call it dormant money. The CHAIRMAN. With $196,000,000 unspent in the Treasury, I do not understand why we should need such a large continuing appropriation at this time in the face of the business situation. Mr. MACDONALD. Mr. Chairman, that brings up the old question of money in the Treasury and money available for construction. The CHAIRMAN. I understand it is allotted; but, it seems to me, that ties it up and there is no definite time when it is going to be used. Mr. MACDONALD. Mr. Chairman, this is our statement with reference to the funds available for construction. It has no reference to money in the Treas ury, but has reference to funds available for construction. I will give you a statement of the funds from the standpoint of the Treasury later. On February 1 the total allotment from all previous appropriations to the States was $339,875,000. The Federal aid actually completed by the States or under actual construction-that means the contracts actually let and the work going aheadamounted to $203,947,000, leaving available for new construction $125,927,000 in Federal funds. That was on the 1st of February. We estimate there will be placed under contract by July 1 $40,000,000 plus, leaving about $85,000,000 available for new construction. We have placed under construction during the last three years an average of about $82,000,000 per year, so you see there will be just enough money available on the 1st of next July to provide for the letting of new contracts up to the 1st of July, 1923. It must be remembered, however, that prior to this time, if Federal aid work is to be put under construction after July, 1923, project statements must be prepared and approved, surveys made, and plans, specifications, and estimates prepared and approved prior to that time. This work can not be done unless funds are made available at this time. The CHAIRMAN. Are those contracts with builders or with the departments? Mr. MACDONALD. They are with builders. This is work the States have actually placed under construction. Mr. LARSEN. Mr. Chairman, there are two questions I am interested in. In the first place, I understood the testimony of the director to be to the effect that $50,000,000 would not meet the demands of certain States, and there are two things I want to know. I want to know what States they are whose demands will not be satisfied, and then I want to know what amount it will take to satisfy the demands of those States. Those two things are the matters that I am interested in. Mr. MACDONALD. As I have stated, without an additional Federal appropriation the majority of the States would have no money with which to let new contracts. That is the basis on which I make the statement that without a new appropriation the work can not go forward next year. I have figured on the basis of an appropriation of $50,000,000, and have a table here based on an appropriation of that amount. For example, take the State of Arizona, their estimated Federal aid balance on July 1 would be $800,000. Their apportionment of $50,000,000 would be $702,000, which would mean a total of $1,502,000. They put under construction during the fiscal year 1921, which was last year, $1,782,000. In other words, on the basis of a new appropriation of $50,000,000 the State of Arizona would not be able to do as much work as they did last year by $200,000. Mr. LARSEN. Do they desire to do the same amount of work this year, so far as you know? Mr. MACDONALD. As a matter of fact the States generally, I believe, desire to do more work. Prices are down and there is a large amount of labor available. I wish to say, Mr. Chairman, we have cut our estimates to the extreme limit on this matter. The CHAIRMAN. Suppose those estimates were met, you will divide that percentage and place more to the credit of the States that are not using the funds, will you not, and they will have an additional amount of money that is tied up, and you have no definite idea of when they will commence the work? Mr. MACDONALD. Oh, yes. The CHAIRMAN. I mean the States that have been holding it up. Mr. MACDONALD. Yes, sir; all the States are going ahead. For example, New York State, which had more than any other State to its credit, will absorb probably its entire balance this year. The State of Alabama, which is another State that had a large allotment, has just voted a large bond issue which will meet every cent and more of Federal aid funds, but they have been tied up for the past two or three years. The State of Indiana is going ahead this year. The State of Michigan will take up their entire allotment. There are seven States that last year had half of the entire available funds in their treasuries that are all going ahead on a full working program this year. Mr. CABLE. How would that stand with reference to Ohio, July 1? Mr. MACDONALD. Ohio will have to its credit $4,000,000 and the new allotment would be $1,882,000, or a total of $6,000,000. Last year they put under construction $2,782,000. Mr. CABLE. What do they contemplate doing next year, do you know? Mr. ROBSION. Can they do it? Mr. MACDONALD. I do not think that they can, but they think that they can, so there is a difference of opinion. Mr. Chairman, I will be glad to submit this table for the record if you wish. This does not agree exactly with the States' estimates in all particulars. It is more conservative than the States' estimates on what they can do. United States Bureau of Public Roads-Statement of Federal-aid funds. United States Bureau of Public Roads-Statement of Federal-aid funds-Con. Mr. ROBSION. How would the State of Kentucky stand on the 1st of July? Mr. MACDONALD. Kentucky will have a balance of a million and a half, approximately. And they would have available $2,524,000 for new work next year. Last year they put under construction $1,835,000—that is, they would have to increase their program slightly to take up the amount available next year. The CHAIRMAN. How far did the States fall below their estimates for last year? Mr. MACDONALD. I do not recall that we collected figures on this same basis last year, Mr. Chairman; I think not. The CHAIRMAN. It was considerable, was it not? Mr. MACDONALD. No; I do not think so. You see, we have held this program for three years on this basis. We are basing this estimate on a program which has been approximately the same program for three years-$81,366,000 Mr. CABLE (interposing). That is to say, the $50,000,000 is recommended upon • that? Mr. MACDONALD. No. That takes into consideration the condition of the Treasury at the present time. Mr. CABLE. But when you take into consideration the contemplated advancement, the increase in the work which you have indicated, is it not a fact that $50,000,000 would curtail their ambitions and reduce their road construction in about 33 States? Mr. MACDONALD. In about 12 or 13 States. |