In addition. Interstate System highways are largely limited-access roads. You can only get on them at widely spread intervals. This means that farmers and others in sparsely settled areas, like Montana, probably would have to drive several miles before they reach a highway entrance. Once on the highway, they may have the same trouble getting off.

In Montana, we would be better off if we spent more money on primary and secondary roads. The farm-to-market road program still is a long way from being completed.

Since the Interstate System is our national defense system, I believe the Federal Government should assume a much greater share of the construction cost. The Federal share should be at least 90 percent.

Noting the Advisory Committee's recommendation that $225 million be spent on forest highways during the next 10 years reminds me of a need which I have discussed previously this year with the Agriculture Subcommittee of the Committtee on Appropriations.

Because it involves millions of sportsmen and millions of dollars in revenue, I believe your committee will be interested in the problem of recreation roads. Most forest road money goes for roads over which to haul national forest timber that has been cut by private operators. This is good business, since mature timber needs to be harvested from remote areas before it is destroyed by forest pests or disease.

However, many of the forest roads and trails used by sportsmen are in bad shape and need rebuilding or extensive maintenance. Also, new roads are needed to accommodate the rapidly increasing number of people using our forests. Many such roads are needed in the West and also in the national forests of the East.

In Montana, we need several roads solely for the people coming to the forests for recreation. Since funds earmarked for building timber access roads should not be diverted to building roads for recreational needs, attention should be given to an appropriation of $3 or $4 million a year for building recreation roads in the next 4 years. This money will come back to us many times over.

Each year, additional millions of people are coming into the national forest to camp, hunt, and fish. So far, we have failed to provide safe, passable roads for them. I believe we cannot turn our backs on this situation much longer. Somehow, we must provide for improving at least two-thirds of the existing 20,000 miles of recreation roads in the national forests as well as bulding another 12,000 miles of new recreation roads to meet the ever-increasing numbers of people coming into the forests.

These recreation roads at the end of the highways are a magnet which draws sportsmen into our forests and dollars into State and Federal treasuries. The 40 million people who go into our forests for recreation each year spend millions in gasoline taxes alone, and probably make a forest road a better gas tax revenue raiser than a turnpike.

Now several people have called my attention to a need for a provision for reimbursement for moving utility facilities incident to highway relocation.

You have the April 8 letter on this subject from Gus Norwood, executive secretary of the Northwest Public Power Association, composed of 97 electric systems serving 1,750,000 people in Montana, Idaho, Washington, Oregon, and Alaska.

This problem has also been called to my attention by Mr. C. W. Haas of the Big Timber Telephone Co., Big Timber, Mont.; Mr. Grant Preston of the Hot Springs Telephone Co., Hot Springs, Mont.: Mr. K. P. Todd of the Mountain States Telephone & Telegraph Co., Helena, Mont.

I want the committee to have this paragraph from Mr. Haas' letter to me under date of April 21:

"You are probably informed that the Bell system is perfectly capable of handling its own relocation costs, but I would like to inform you that two-thirds of the area of the United States, receives its telephone service from some 5,000 independent telephone companies. The cost of relocating their telephone lines for highway relocation is sometimes a severe burden on these small companies." However, relocation is also a severe burden on Bell system companies. I see no reason why the electric and telephone utilities have to pay for moving their lines as a result of relocation of highways, but other utilities are reimbursed. If there should be reimbursement, it should be applicable equally to all telephone and electric utilities small and large alike.

Relocation is also an expensive problem for our public water supply utilities. I have the following telegram from Mr. A. W. Clarkson, Helena, secretary-treasurer of the Montana section, American Water Works Association.

"Montana section, American Water Works Association, at annual meetings in Butte April 29 and 30 unanimously voted to request that you do everything in your power to endorse legislation relieving public water supply utility owners of financial burdens caused by Federal highway relocations."

Here is the material previously referred to. You will note that Mr. Hart's analysis of pending highway legislation is dated February 17, 1955. By airmail, dated April 23, 1955, I asked him to make any changes he wished as a result of legislative action since that date. I have had no reply to that inquiry.

Hon. LEE METCALF,

House of Representatives, Washington, D. C.

STATE OF MONTANA,

HIGHWAY COMMISSION,
Helena, February 17, 1955.

DEAR MR. METCALF: I know you are well aware of the difficult problem facing Montana in providing adequate revenue for the maintenance and construction of its highway system. S. 1048 would make full participation by Montana in the Federal-aid program an impossibility.

The Federal Aid Act of 1954 provided $13,531,734 to Montana for the fiscal years 1956 and 1957. This represents an increase of $4,363,953 over the previous allotment and requires $2,769,761 per year in additional State matching funds.

Senate bill S. 1048 would increase the Federal aid to Montana to a new total of $24,805,175, or $11,273,441 per year over the amount apportioned in the 1954 Act, and increases the Federal aid by $15,637,394 over the current year's apportionment of $9,167,781 which is effective under the 1952 act. The equivalent annual State matching funds required amount to $6,916,045 under the 1952 act, $9,685,806 under the 1954 act, and $16,279,086 under Senate bill S. 1048. The following table presents a comparison of the effects of the various apportionments:

At the present time, we have a backlog of $6,798,543 in Federal aid which has accumlated over a period of years and which we are unable to match under present revenue sources and amounts. An additional $5,128,141 in State funds would be required to match this backlog of Federal aid.

In addition to this amount, $2,769,761 in new State revenue must be obtained to match the increased Federal aid under the 1954 act.

This financial problem has been under study by the Governor's interim highway committee for the past year and recommendations were made to the legislature which, if enacted, will provide sufficient additional revenue to enable the State to overcome the backlog of Federal aid within a few years and to match the Federal aid accruing under the 1954 act.

These measures include an increase in the gasoline tax from 6 to 7 cents, an increase in the diesel tax from 6 to 9 cents, and a general increase in the gross vehicle weight tax rates. Since the payment per vehicle in road-user taxes in Montana is already well above the national average, the enactment of these additional taxes will increase the tax burden very close to the breaking point.

For this reason, we can forsee no possibility of raising sufficient additional State revenue, over and above that now being considered by the 34th legislative assembly, to permit the matching of the $15,637,394 per year in additional Federal aid under Senate bill S. 1048.

With reference to the Clay committee proposal, it is our understanding that the State matching requirements will be held at approximately those prevailing

under the 1954 act, except that the Federal Government would assume substantially the entire cost of constructing the Interstate System. Although the relocation of the Interstate System, with atendan addiional mileage, will involve some increase in the maintenance cost to the State, we feel that the State will be able to meet its financial responsibility under the recommendations of the Clay Committee, as we understand them.

We endorse the Clay committee recommendation that the Federal Government assume a much greater share of the cost of constructing the Interstate System. This contention is supported by the importance of this system to the Nation from a strategic and military standpoint. It is also supported by the fact that the higher standards prescribed for the Interstate System involving greater widths, additional rights of way, costly interchanges, together with its probable duplication of existing Federal aid highways in many instances, will place the cost of this construction much higher than that required to meet the needs of the Montana vehicle operator.

Summed up, we have reason to believe that Montana will be able to match the Federal-aid allocations which would accrue to this State under the provisions of the Clay committee recommendation, providing the State's percentage of partici pation in the construction costs of the Interstate System are not too high. We believe hat the matching ratio for the Interstate System of Highways, under this recommendation with its requirements which are far beyond the needs of our Montana economy, should be 95 percent Federal participation to 5 percent State participation, rather than the 90 percent and 10 percent, or the 75 percent and 25 percent participations, respectively, as have been discussed by some proponents of the Clay committee plan. As a matter of fact, we further believe that where a duplication of existing road facilities, adequate to Montana's needs is concerned, the entire cost of the paralleling Interstate Highway construction should be borne by the Federal Government.

Definitely, Montana will not be in position to match the Federal aid allocation which would accrue to this State under the provisions of Senate bill S. 1048.

Your best efforts to secure favorable consideration of the Clay committee recommendations, with reference to the Interstate Highway System, on a matching basis of 95 percent Federal to 5 percent State participation and, if possible, on a 100 percent Federal-aid basis where the paralleling of existing Federal-aid roads will be required, will obviously be to the best interests of the citizens of this State, and will be appreciated by this department. Sincerely,

Hon. LEE METCALF,

SCOTT P. HART, State Highway Engineer.

KALISPELL CHAMBER OF COMMERCE,
Kalispell, Mont., April 20, 1955.

House of Representatives, Washington, D. C.

DEAR REPRESENTATIVE METCALF: Our committee has been very much interested in the new proposed Federal-aid highway program which we understand is now being considered in committee, and we would like to submit to you our views unanimously arrived at by this committee at a resent meeting.

First of all, we are in favor of increasing Federal aid to speed the improvement of our Nation's Interstate Highway System, but we feel that this new program should include certain new aspects. We are in favor of:

(1) A pay-as-you-go plan;

(2) An increase in the Federal Government's share of the cost of construction beyond the present 60 percent Federal and 40 percent State ratio;

(3) The legislation should provide for proper regulation of the use of these interstate highways so that the cost of maintenance thereof after construction shall, so far as possible, be recovered from the use made of them.

With reference to (1), we are not in favor of establishing a separate Government authority with power to issue bonds outside of the debt limit.

With reference to (2), we feel that it is to the best interest of Montana that the Government participate to the fullest extent possible in this program since, as you know, Montana otherwise would not be able to get the benefit of this new highway program because of its everpresent inability to match the Federal funds even on the 60-40 basis, since the cost of construction of highways in our large State is in an indirect proportion to the ability of our small population to pay for these costs.

As to (3), we feel that our highway system has become more and more important as a modern means of transportation, and yet, up to now, the cost of construction and maintenance of that transportation system has not been borne on the basis of use. By that we mean that by far the largest part of the wear and tear to our highways has been caused by heavy traffic which has increased phenomenally from year to year, yet that particular traffic remains largely unregulated so far as sharing its proportionate cost of highway maintenance. That traffic is in direct competition to other modes of transportation, particularly the railway system, and yet the latter has always had to maintain its own right-of-way system in addition to paying heavy taxes on its property. It is our thought that this problem is directly connected with the idea of pay as you go, and it should be thoroughly considered and embodied in any new highway-legislation program.

We shall appreciate your thorough consideration of these matters.

Very truly yours,

A. E. JOHNSON,

NATIONAL AFFAIRS COMMITTEE,
Rev. GEORGE VAN LEUVEN,
EDWARD C. SCHROETER,
D. GORDON ROGNLIEN,
CHARLES HASH,

DAN J. KORN, Chairman.

HELENA, MONT., May 17, 1955.

Executive Secretary, American Association of State Highway Officials,

Washington, D. C.:

Re your letter, May 13, Montana will be unable to match the Federal aid highway allocation proposed under the provisions of the amended Gore bill, Senate bill S. 1048. This State's matching ability is definitely limited to $91⁄2 million per year. Over the 5-year period of allocations as proposed under Senate bill S. 1048, Montana would develop a credit of approximately $20 million of Federal aid money which it would be unable to match. We favor continuation of the Federal aid allocations as now provided under the 1954 Federal Aid Act for the primary system other than the Interstate System, for the secondary system, and for the improvements of Federal aid routes in urban areas. We believe that allocations to States for the renovation of the Interstate System should be in strict accordance with the needs as determined, spread over not less than a 10-year period, with a minimum of 90 percent, and preferably of 95 percent, Federal participation in the Interstate Highway construction costs. We believe, further, that the question of reimbursing public utilities now occupying public rights-of-way for necessary moves is one that should be solved in accordance with the laws of the individual States and not be Federal statute. Also, it is our conviction that labor relation problems and requirements incidental to highway construction, a State matter, should be determined at the State level and not by arbitrary Federal legislation. We protest any legislation at this time, or in the foreseeable future, which may call for an increase in the Federal taxes on gasoline, or on other motor fuels or automotive accessories. SCOTT P. HART, State Highway Engineer.

BRIEF SUMMARY OF TRUCKING INDUSTRY'S POSITION ON PROPOSED FEDERAL HIGHWAY PROGRAMS AND TAXES

Any expansion of the Federal Government's highway activities logically should be concentrated on the 38,000-mile National Interstate System of strategic highways which are recognized as vital to the military and civilian defense, as well as to the general economy and interstate commerce.

The proposal of the Clay committee to pay for this System on the installment plan through bond financing appeals to us because it would make it unnecessary to further increase Federal motor-vehicle taxes.

Down through the years, the Federal taxes on motor fuel, equipment, tires, tubes, parts, and accessories have exceeded by $10 billion the amounts spent by the Federal Government for highways. Even if the past is disregarded, these taxes currently yield more than $2 billion a year-enough to finance the Interstate System on a current pay-as-you-go basis.

Logical arguments can be made pro and con as to whether these taxes are highway user taxes which are or should be linked with highway expenditures, but it cannot logically be both ways in practice.

If they are not highway user taxes, then they are unjust, discriminatory general levies against motor transportation which are not paid by competing railroads. Comparable taxes on railroad fuel and equipment would cost the rails about $150 million a year. (The rails are not even required to pay the 2-cent per gallon levy on diesel fuel.) If the taxes are not to be considered highway user taxes this inequity should be corrected by repeal of the taxes.

By the same token, if they are to be continued they should be considered highway user taxes and a credit against whatever responsibility accrues to motor vehicle owners under the expanding Federal highway program.

The trucking industry objects vigorously to being singled out for increased taxes as proposed by Senator Case in S. 1573, which would levy Federal license fees ranging from $300 to $1,200 a year against vehicles of 20,000 pounds or more gross weight.

The industry is made up of thousands of small, narrow-margin businesses and the fees proposed in S. 1573 would wipe out the industry's net operating revenue before taxes and place the industry at large deeply in the red.

Moreover, the only argument advanced in support of the fees fails to recognize prevailing conditions.

It has been suggested, by way of justifying imposition of the entire proposed increase upon certain classes of motor trucks, that the presence of these trucks necessitates higher highway standards and thus higher highway costs than otherwise would be necessary.

This question arose in 1950 during the exhaustive hearings conducted during that year by the Senate Committee on Interstate and Foreign Commerce. At that time, in his testimony before the committee, Thomas H. MacDonald, the long-time chief of the United States Bureau of Public Roads, stated:

"The minimum requirements of structural and capacity of the major routes to serve national interests must be equated to the foreseen needs of the national defense. Thus, the question of whether the highways could be built at less cost if there were no heavy trucks becomes largely academic since the design of major routes must be held to defense standards."

This is an extremely important consideration but for purposes of this discussion we will ignore the special national defense aspects of the National Interstate Highway System and proceed from the premise that, speaking generally, the cost of building and maintaining some highways is higher than might be the case if there were no large trucks and buses.

To concede this is to concede only that the large vehicles should pay relatively higher taxes than the small vehicles, and even casual analysis will show that they do pay higher taxes on the Federal as well as on the State level.

The Federal fuel tax and the varying State fuel taxes apply alike to all motor vehicles with respect to the rate of tax per gallon. However, the large trucks get only 3 or 4 miles to the gallon as compared to about 16 miles per gallon for passenger cars. This means that the fuel tax, whatever the rate per gallon, results in a tax per mile operated that is 4 or 5 times higher for larger trucks than for small vehicles.

The toll charges on existing toll turnpikes vary according to the type and size of vehicles, and presumably the differentials have been established on a basis that is deemed fair and reasonable by the experts who build and operate these special highway facilities.

The average toll on these turnpikes is about four times as high for the typical tractor-semitrailer combination as for the typical passenger car. Thus, the fuel tax automatically assesses a differential against large vehicles that is comparable to the differentials applicable on the toll roads.

On the State level, the fuel taxes are supplemented by registration fees which are a great deal higher for large trucks than for passenger cars.

A Nationwide study by the Bureau of Public Roads for 1953 showed a national average registration fee of $11.95 for light passenger cars, as compared with averages of $588 for a 4-axle truck combination; $1,148 for a 5-axle truck combination, and $1,844 for a 6-axle truck combination.

Similarly, on the Federal level the fuel tax is supplemented by the excise taxes which again fall much more heavily upon the large truck than upon the passenger car.

Based upon a $1,575 f. o. b. factory price for a light passenger car, as shown in the Bureau of Public Roads study already mentioned, the Federal excise tax