State current income used for roads, most of which came from highway-user taxes, exceeded $5.5 billion in 1961 and $13 billion in 1973, the 1973 figure being nearly 2½ times the 1956 level. The net Federal aid received by the States rose dramatically from $776 million in 1956 to $4.5 billion in 1973.
Income of local governments from all sources to be used for roads and streets grew rapidly after the end of World War II, relatively more rapidly in urban than in rural areas. Net aid to rural governments, largely from the State and Federal Governments, increased from $675 million in 1956 to $844 million in 1961 to $1.9 billion in 1973. The amounts received by urban governments were at a lower level in 1956 ($258 million), and rose to $357 million in 1961 and almost $1.4 billion in 1973, an increase over the entire period of 371 percent compared with 181 percent for rural units. Revenues from local sources also made significant gains as property tax yields grew and larger sums were made available from general funds. Current revenues of the rural units available for roads rose from $647 million in 1956 to $1.5 billion in 1973. For urban governments, the comparable figures were $881 million in 1956 and $2.7 billion in 1973.
Expenditures for highway capital improvements responded to the growth in available revenues. State capital outlay (including that for toll facilities) went up from $3.9 to $9.5 billion between 1956 and 1973. Before 1965, most of the increase after passage of the Federal Aid Highway Act of 1956 is attributable to the Interstate System. By 1965, Interstate investments stabilized, while non-Interstate expenditures increased from $3.3 billion to $5.6 billion.
Rural and urban local governments spent nearly the same amount ($1 billion) for capital improvements in 1973. In the case of the rural units, this expenditure represented a 125-percent increase over 1956, and in the case of the urban units, a 90-percent increase.
Historically, capital costs have represented the major share of total annual disbursements for highways by all levels of government. But with increasing noncapital demands due to such related requirements as providing for public safety, highway and vehicle law enforcement, higher interest on indebtedness, and increasing requirements for maintenance and operation of the highway plant, by 1975 the proportion of public funds available for capital improvements had declined to less than one-half of the dollars spent.
Inflation has had a serious effect on the Nation’s economy. The cost of highway construction has doubled since 1967, and the miles of highway put in place per dollar have shrunk considerably. Total capital outlay of $13 billion expended in 1974 is only $6.5 billion in terms of constant dollars (1967 base), a figure approximately equal to the constant-dollar value for 1957.
The Nation’s total expenditures for highways have exhibited a pattern of steady growth since the end of World War II, growing from $1.7 billion in 1945 to $4.5 billion in 1950, $10.8 billion in 1960, and $20.8 billion in 1970. This rate of growth was 36 percent faster than that of the gross national product (GNP). For 1975, total highway expenditures were nearly $26 billion.
But, if the actual amounts are corrected to remove the effects of inflation, the recent picture of highway finance looks less optimistic. In terms of 1967 dollars, total disbursements for highways by all levels of government peaked in 1971 and have since been declining. Whereas current-dollar disbursements in 1971 were more than twice those of 1960, the increase in terms of constant dollars was only about one-third. Total disbursements per registered vehicle have declined from $199 in 1971 to an estimated $189 in 1974. In terms of constant dollars, the decline began in 1969 at $161 per registered vehicle and dropped to an estimated $110 in 1974.
Related to vehicle-miles of travel, disbursements have fluctuated since 1971 and are now on the rise. But expressed in constant dollars, total disbursements per million vehicle-miles of travel have been declining since 1961. Thus, although the amount of travel has greatly increased, expenditures for highway facilities related to this travel have declined.
Before World War II, highway construction represented a more significant share of the gross national product than it has at any time since. In 1939 it equalled 1.72 percent of that year’s GNP. The highest postwar percentage was in 1958, when it reached 1.42. For 5-year periods, the average percentages of GNP are as follows:
| 1945–1950 _ _ _ _ _ _ _ _ _ _ _ _ | 0.58 |
| 1950–1955 _ _ _ _ _ _ _ _ _ _ _ _ | 0.92 |
| 1955–1960 _ _ _ _ _ _ _ _ _ _ _ _ | 1.27 |
| 1960–1965 _ _ _ _ _ _ _ _ _ _ _ _ | 1.28 |
| 1965–1970 _ _ _ _ _ _ _ _ _ _ _ _ | 1.19 |
The 1974 highway share of GNP (0.85) was less than half that of 1939.
It would appear that, while the demand for highway services has been accelerating, it has not been accompanied by a corresponding increase either in the supply or in the quality of highway facilities. The demand for travel, which has grown in recent years, is expected to increase in the future, although at a reduced rate, despite such constraints as increased fuel costs, fuel conservation efforts, and modal shifts from automobile travel to various forms of mass transit. It is possible that the performance of the highway system, which is directly affected by investment, not only is not keeping pace with demand but is actually deteriorating.
Broadening the Highway Program
The surge of statewide planning activity that began at the close of World War II included planning for urban areas, and the rate of roadbuilding in these areas was greatly accelerated after passage of the 1956 Act. The development of urban transportation from 1960 to 1970 was marked by a 28-percent increase in municipal highway mileage.
Despite the stepped-up population movement to the suburbs that occurred in the postwar period, the cen-tral cities of the larger metropolitan areas were still considered to be the focal points of the local transportation network, and growing commuting and other traffic was expected to pour more and more vehicles into these areas. As increased long-distance commuting into, out of, and through central cities produced heavier automobile traffic, the circular action-
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