and even for matching Federal aid.[N 1] State funds were further depleted by increased allocations of highway revenues to counties to meet the charges on their own highway bonds and to replace shriveling property taxes, by payments to the financially beleaguered cities and by diversion to nonhighway purposes, principally schools and relief.
The road contracts financed with Emergency Relief and Construction funds were the first to contain predetermined minimum wages for skilled and unskilled labor. Congress insisted on these determinations to protect labor from wage pressure and arrest further deflation in wage rates. These contracts set the pattern for other road work, and in a short time, minimum wages became standard provisions in all public works contracts.
With the change of administrations in 1933, the Government suspended regular Federal-aid authorizations and embarked on a massive program of emergency public works. The National Industrial Recovery Act of June 16, 1933 provided $400 million in grants to the States without the requirement that they be matched by State funds and instituted some notable changes in Federal road policy. For the first time, Federal funds could be spent on urban streets that were extensions of the Federal-aid highway system to and through municipalities and on “secondary and feeder roads” that were not on the Federal-aid system.[N 1]
To spread the work, Congress limited employment to 30 hours per week per worker, prohibited convict labor, and required that hand labor methods be used “wherever consistent with sound economy and public advantage.” The States were required to predetermine fair wage rates and to give employment preference to veterans.
Congress continued the emergency program by appropriating $200 million for unmatched grants to the States in the 1934 Hayden-Cartwright Act and, a year later, $200 million for highways and $200 million for eliminating hazards at railroad grade crossings in the Emergency Relief Appropriation Act of April 8, 1935. These grants, with the National Industrial Recovery Act grant, pumped a billion dollars into highway construction between 1933 and 1938—enough to assure the continuation of highway building at boom levels. Altogether, the emergency funds financed over 54,000 miles of road improvements on the Federal-aid system, urban extensions and secondary feeder roads, plus the elimination of nearly 3,000 railroad grade crossings.[2]
Of equal or greater importance in the reckoning of the Administration, the emergency program provided the equivalent of 162,000 full-time jobs per year at the job site during the depths of the Depression.[N 2]
Indirect employment generated by the program was well over 480,000 full-time jobs.[N 3]
The Broadening of Federal Highway Policy
The emergency funding for 1933, 1934 and 1935 had channeled Federal money into urban areas and into secondary farm-to-market roads not on the Federal-aid system. These emergency measures became permanent Federal policy in the 1934 Hayden-Cartwright Act, which also abolished the limit on Federal payment per mile of road. In this Act, Congress resumed its practice of authorizing Federal-aid funds 2 years in advance, and also the requirement that Federal funds be matched by the States.[N 4]
This return to established Federal-aid principles locked the rather considerable Federal-aid authorizations into the 1936, 1937 and subsequent budgets and also provoked a bitter attack on Federal aid from the President. On November 27, 1937, President Roosevelt sent a message to Congress protesting that Congress practice of advance authorizations “ties the hands of the Executive” and the Budget Director and should be abandoned. The President’s message seemed merely to antagonize the Congress and strengthened its support for Federal aid. Senator Carl Hayden, the principal defender of Federal aid stated publicly that tying the hands of the Executive in the use of road funds was “exactly what the Congress intended to do.” He continued,
‘Although the President transmitted with his message the draft of a bill to change the system and repeal much of the basic highway law, there was not one Senator or one member of the House of Representatives who would even introduce the bill, and the system has continued to operate just as it is now functioning.’[5]
The Hayden-Cartwright Act permitted the States to use Federal-aid funds for plans, surveys and engineering investigations for future work, and this authority was broadened in the Agricultural Appropriations Act of June 16, 1936 to include economic investigations as well. The States could use up to 1½ percent of their matched Federal aid for these activities. This money provided the stimulus and the means for statewide highway planning surveys in every State similar to the BPR’s cooperative transportation studies of the preceding decade. In a few
- ↑ The Secretary of Agriculture channeled one-quarter of the funds into urban extensions and one-quarter of the remainder into feeder roads.
- ↑ Actual employment fluctuated seasonally from about 70,000 In the winter months to as high as 336,000 in summer.[3]
- ↑ BPR studies of a decade of highway expenditures showed that, nationwide, 24.4 percent of the total highway cost was for direct labor at the job site, 50.3 percent was for indirect labor for producing materials and equipment used on the job, and the remainder reached workers in other industries stimulated by the highway investments. For high-type surfaces, direct labor on the job was only 18 percent of the total cost, but for grading work, it went as high as 43 percent of the cost. The BPR concluded, “Where hand labor is permitted to replace modern equipment the amount of improvement obtained with a given expenditure is materially reduced, and the benefit to indirect or industrial labor in cities becomes almost negligible.”[4]
- ↑ The States were required to match the Federal funds dollar for dollar except for those States in which more than 5 percent of the total area was nontaxable public domain or Indian lands, where the Federal share was larger. In Nevada, where such lands were over 80 percent of the State’s total area, Federal aid was about 90 percent of the total project cost.
125
- ↑ Louisiana Highway Forces To Be Gut on Jan. 1, Engineering News-Record, Vol. 109, No. 19, Nov. 10, 1932, p. 572.
- ↑ Bureau of Public Roads Annual Reports, 1934-1944.
- ↑ Bureau of Public Roads Annual Report, 1936, p. 6.
- ↑ Id., p. 63.
- ↑ Save The Federal Aid Highway Principle — The Story of What It Is, How It Operates and The Attacks Against It (National Highway Users Conference, Washington, D.C., Mar. 1942) p. 31.
