The midland journal. (Rising Sun, Md.) 1885-1947, 1938-07-22
Road Fund Diversion
Figures Show Annual Increase Over
Period OF Ten Years


Division of Maryland highway rev.
enue from construction and maintey
nance of roads will have amounted
to more than $29,O00,OOO bysthe
end of the present fiscal biennium,
a survey of States Roads Commission
figures shows.
In the present fiscal biennium
alone, the State budget estimates,
diversions will amount to nearly
$12,O0O,OOO. In 1880 and 1881, be-
fore the trend set in, only 100000
did not go directly to construction
and maintenance.
Again these diversions of ten years
auditors must balance RESERVATIONS
of $5,943,O00 in State bond issues,
which leaves net diversion OF gaso-
line tax and motor vehicle revenue
of $23,O99,841.42.
The bond issues were made neces-
sary when the roads funds were SO
depleted by diversions to the gener-
al treasury and to the counties and
Baltimore city that there was not
enough i'm the construction funds
to match Federal highway aid alloca-
lions.
In 1880, 98S2 per cent OF the
more than SIS, 100000 in highway
revenue was returned and spent on
the roads in construction and main
tenance. The only exceptions were
$4,000 appropriated for county
debt service, a $4S,000 appropriation
to ferry companies and $4,000 for
purchase of toll bridge.
In 1881, the picture was the same,
minus the toll-bridge item, except
for one item of $3,07S.4S marked
'reversion to State Treasury" Like
the cloud mo larger than mans
hand" it presaged mighty storm.
The next fiscal year this item had
grown to $10,27S.S1, and county
debt service taken over by the State
cost $4,000. Total for the year
not directly applied to the roads was
$158,678.S1.
In the 1888 fiscal year, the state
assumed a debt service payment for
the counties of SS57, 956.06, and
paid Baltimore city S259,S98.17 in
cash out OF the ~ cent lateral road
fund. Diversion of State funds from
maintenance and construction
amounted to 1O.46 per cent.
County Roads Taken Over
1t was the 1888 General Assembly
which took over the county road
systems. The full brunt was felt in
the following fiscal year when ST.
125,S66.50 was spent for county
debt service and Baltimore city got
a cash payment of $1,163, 966.33,
relieving the burdens on local real
estate taxes.
In addition, 5,32O55 was di-
verted from the roads money into
the States general treasury, to help
balance the budget at time when
other forms of revenue were Slip
ping badly because of the depression.
For this year, the percentage OF
money diverted from direct road
Expenditures was 24.S4.
In the 1885 fiscal year, Baltimore
city began to get am annual cash
payment derived from truck license
fees. Meanwhile, interest and retire
ment charges began to mount up on
$4,OO0,000 State Road Commits
sion bond issue of 1888 and 49,
100000 one of 1885.
The percentage of diversion adj
vanced to 1884. In the 1886 fiscal
year the amount going to the States
general fund was much smaller, but
the debt service burden increased,
and 2753 per cent. was diverted
from direct expenditures.
The State Roads Commission
bonds did not constitute return of
money to the roads account, since
they had to be financed from future
gasoline tax and motor vehicles rev.
enue. In effect, such bonds were
mortgaging the future yield of high
way taxes to get money for present
construction. The bonds sucked
$3S0,OOO out of current funds in
1886, for instance.
1887 Diversion $2,243,OOO
In the 1887 fiscal year, the big
item in diversion was $2,243,00L
paid into the annuity bond fund for
debt service on general State obliga-
tions. When money spent for the
counties and turned over to Balti-
more city was added to this and SER
vice on the roads bodys own bonds,
$5,629,O00 had been taken form
maintenance and construction funds.
The 1888 and 1889 budgets, for
the period extending from October
1, 1887, to September 80, 1889, are
characterized by continuation of
this kind of financing.
In each of the two years approx
mately $2,000,0O0 goes to service
State bonds, $1,S0O,OO0 is diverted
into the general fund, 100000 is
set aside to carry county debts,
$85O,OO0 goes to Baltimore city and
$65O,O0O is needed for the commits
sion debentures.
Such is the story of a decade of