Moving people and goods: the trolley line, the highway, the canal, and the railroad. By late 1930’s, the trolley lines and the canals had become casualties of the transport war between highways and railroads.
The transportation of goods by highway, on the other hand, was becoming increasingly important economically, so much so that by the late 1930’s the railroads, beginning to view intercity truck transportation as a competitive threat, called for a study of truck taxation. In 1936, the first year such calculations were attempted by the Bureau of Public Roads, the average truck was estimated to have been driven about 10,000 miles a year, and total travel of all trucks was estimated at 41 billion vehicle-miles.
Special fees and taxes had begun to be levied in connection with registration fees on for-hire carriers of persons and property. By the mid-thirties, such imposts were in effect generally in the States, although they were not great revenue producers. Their importance lay in their usefulness as a means of regulation and of applying concepts of equity to the tax schedules.
The 1933 low point of $1.7 billion in total expenditures for highways was followed by an erratic increase, which peaked at almost $2.7 billion in 1938. Then the Federal emergency funds began to run out. But the expenditures from funds normally available for highways continued a gradual upward trend until World War II stringencies began to force a reduction. Federal work-relief expenditures, although continued through 1942, reached a maximum in 1938, when the amount spent on county and local rural roads reached $389 million and on city and village streets, $367 million.
The late 1930’s saw what may be said to be the beginning of the modern toll road movement with the construction of the Pennsylvania Turnpike from 1937 to 1939. The State turned to this method of financing because of insufficient funds to improve existing roads to adequate standards. But the turnpike was not financed as a wholly self-supporting facility. Federal Public Works Administration grants totaling $295 million were supplemented by $40.8 million of bonds sold to the Reconstruction Finance Corporation. The turnpike suffered badly because of wartime restrictions in the 1940’s, and it operated at a loss most of the time until the end of the war.
Although the total governmental debt for highways included such large revenue bond issues as those for the Pennsylvania Turnpike, the San Francisco Bay Bridge, and the Port of New York Authority’s bridge and tunnel program, the period of the 1930’s produced slightly diminished State highway borrowing. The dominance of Federal-aid funds during this period of depression and recovery reduced the relative contribution of bond proceeds to about 20 percent of the funds used to finance highways. But the reliance on borrowing shifted from the local governments to the State. In 1926 State highway bond issues exceeded those of county and rural local governments for the first time and, with several exceptions, have annually dominated the highway bond market.
The Federal Government’s anti-toll policy was once again written into the statutes with the passage in 1937 of a law authorizing Federal-aid funds to be used for freeing toll bridges on the Federal-aid system. It authorized the payment of Federal money up to 50 percent of the cost of labor and materials actually used in the construction of any toll bridge built after 1927 on the Federal-aid system. In return, the recipients had to agree to remove the tolls.
At the close of the 1930’s, highways had not fully recovered from the effects of the Depression. World War II was raging, and the possibility of an end to United States neutrality was on the horizon.
248
