Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1913-07-14
Bourne's U. S. Highway Fund Plan.

Hon. Jonathan Bourne, Jr., chair
man of the joint committee on federal
aid in the construction of post roads
has a plan for making one hand wash
the other in The matter of good roads.
His hope lies in federal aid of states
would create a L. S. highway fund
apportioned and credited to the sew
eral states in the following manner.
'sThe United States Highway Commits
sion hereinafter created, shall ascertain
in the most practicable manner from the
best information available the total land
area, the population according. to the
last Federal census, the total assessed
valuation of all taxable property, and
the total mileage of public highways in
each of the several States, and shall
compute the percentage ofNthe total of
each of these four items possessed by
each State. They shall then compute the
average of the four percentages for each
State, and this average shall be the per
cent of the s1.000,0oo.eoa United States
Highway Fund that shall be apportioned
and credited to each state. said COM
mission shall notify the Treasurer of the
United States of the result of their as
certainment and computation, which
shall be made of date to be fixed by
the commission. Such fund, SO appor-
In accordance with the provisions of this
act.
Sec 5. That whenever any State,
through its duly authorized agents, shall
apply for any part of its share of the
United States Highway Fund. but not
exceeding 20 per cent. thereof in any
year, and shall deposit with the Treas
urer of the United States its bonds for
such amount payable in 50 years and
bearing interest, payable sem-annuaIly.
at the rate of per cent. per annum, said
Treasurer of the United states shall is
sue and sell by popular subscription and
upon pro rata allotment basis United
States highway bonds herein authorized
to the amount that may be necessary to
pay to said state the amount of money
applied for, and upon the sale of said
bonds shall pay over the proceeds to the
custodian of the public funds of the
State: Provided That the bonds of any
State shall not be accepted il the total
amount of bonds of such state, including
the bonds issued to take advantage of
the provisions of this act, shall exceed
10 per cent of the amount of the assessed
valuation of all taxable property in such
State
OF course there is much more of this
matter of essentials but here is the
way he thinks the plan would oper-
ate. and it is worthy of consideration.
Undoubtedly some such scheme will
be worked out eventually to provide
the active generation with broad,
smooth highways without burdening
posterity with principal and interest:
To illustrate the practical working
Of the plan, let us suppose that all the
States avail themselves of the oppor
tunity of utilizing the superior credit
of the United States up to the 20 per
cent. annual limitation for each State.
We would have SEQ, 100000 of 50-year
semiannual per cent. State bonds
deposited with the Treasurer of the
United States. upon which collateral
the Secretary of the Treasury would
offer for popular subscription, at not
less than par and upon a pro rata
allotment basis, s200,000,000 of per
cent. Federal bonds, and from the
$2e0,000000 obtained in the sale of the
same, pay to the States the par
amount of their bonds according to
the percentage of apportionment set
forth in the bill. The Federal Gov
eminent would receive from the
States. in semiannual payments, in
terest at the rate of per cent, or
xS,oeo.o00 annually. out of which it
would pay to the investors in the
Federal bonds s6,000600 annually, to
pay annual interest of 3 per cent on
$200,000,000 United States 50-year .
per cent. bonds. leaving an excess of
$2,000,000 annually received from the
States over what the Federal Govern
fnent would pay in interest charges on
similar amount of Federal bonds
On this excess of s.. 100000 the Fed.
eral Government would allow per
cent. annual compound interest. AT
the end of 1859 years this sinking
fund would amount, under this plan,
to 100000, 900. so that the Federal
Government would have the funds to
pay off the bonds it had issued to the
public for which it held the State
bonds as collateral and at the end of
SO years from the date of issuance of
the State bonds the Federal Govern
ment would return said bonds to the
respective States marked Cancelled"
By depositing their bonds with the
Federal Government as collateral and
utilizing the superior credit of the
Federal Government in getting money
at Sper cent. the States would ult-
mately have received 5000 600 600 cash
at l per cent cheaper interest than
d
lie sale of their own bonds This utili-
zation of the Federal Governments su-
perior credit, without any greater ex-
pense to the States than the interest
charge alone If they sold their bonds
in the open market together with the
Federal Governments 3 per cent. an
nua1 interest allowance. would pro-
vide the fund with which the oblga-
iquidated at the expiration of SO
years.
II this is not lifting ones self by his
bootstraps il is, at least a good imi-
tation Of the feat. Building roads
with money that pays for itself is like
the Bowdoinham plan of making birth
day presents TO itself generations
ahead.