Governor MANDEL. Let me say this, Senator. We are talking about a short-range problem and a long-range problem. I think the two have to be treated separately. I think the long-range problem has to be faced. If we don't face it, and it is not just a facet of it, I think the whole problem has to be faced, because with the escalation of costs—the escalation of costs is unbelievable.

Unless you are dealing with it every day, you don't really know the impact of it. Also the escalation of time. It takes us today in our State 84 months from the time we plan a highway to the time we get it under construction. Just to start construction; 84 months; you escalate that cost at anywhere from 20 to 30 percent a year, as it has been escalating, and take 7 years from the time you start planning a highway until you start constructing it, that highway is costing us a minimum of 150 to 200 percent more than it would have cost us when we started planning it.

A perfect illustration is down at the Patuxent River, where we are building a bridge authorized in 1967 for $10 million. We are building it now. We finally got the last permit from the Coast Guard and the Corps of Engineers about a year and a half ago, and that bridge is costing us $28 million. It is the same bridge we designed in 1967.

Senator BENTSEN. Governor, I tell you how these things really make an impact, when they relate to you personally. I built road into my ranch home down in Texas 7 years ago and I resurfaced it last year, and it cost me more to resurface it than it did to build the road.

Governor MANDEL. If you were building the road today and had to get all the permits you had to get, do you know when you would build that road? In 1985. And I am serious. It is costing us a fortune in dollars because of the endless delay in getting under construction what has to be built. We are not a private industry that can say, "The heck with it, we will not build it."

We have to build it. As each year goes by and those costs go up, and we are still standing by to get those permits from all of the different agencies we have to get them from, those costs keep escalating. We are out of money because of the cost factor, not because we have not raised our taxes to provide our own funds.

We raised our gasoline tax 2 cents a few short years ago in Maryland. How many times can we keep raising it?

Governor RAMPTON. Are you 7 cents now?

Governor MANDEL. We are 9 now. We raised it 2 cents 5 years ago in anticipation of this problem. How much can we keep raising it? The increase is only paying for the increased costs. It is not paying for the new construction. As this continues, we have got another bridge that has to be built that we started 7 years ago planning. It will be another 3 years before it is built. It started out at $5 million. Today the estimates are $27 million and going up. We still have not gotten permission to build.

I would hate to tell you the reason. If I told you, it is because there are some ducks and fish in the way.

We had testimony just before our board the other day where there was a permit we had to give under our wetlands law. The company came in that was going to do the work, it would cost $4 million more because they are required to move the line because there were two

bald eagles nesting in a tree. They offered to build a house for the eagles. That wasn't any good. I told them I heard that eagles were migratory birds. Suppose the eagles moved the same time they moved the path of the line.

I am serious. This is not hearsay. This is what happened just last Wednesday-$4 million to move the line because of the two eagles. That is fine; I want to preserve eagles. It would have been much simpler to move the eagles. We would not have hurt them a bit.

Governor RAMPTON. You know how we are going to solve the predator problem? Hathaway is going to teach the American eagles to eat coyotes. [Laughter.]

Governor MANDEL. Until we face up to these issues of getting action and getting things done whether they are going to tell us yes or no-let them tell us something.

Senator BENTSEN. I could not agree with you more, and we have had EPA before us and a number of the other agencies stressing the very things you are talking about.

A fellow who spent most of his adult life in business, it is awfully difficult to understand these delays.

Governor EVANS. To speak directly to that question of flexibility of use of interstate moneys, I think there is a great desire on the part of every State and also a national interest in the completion of the Interstate System so it does become totally the system it was intended to be. We have, however, in our State, I guess a horror story even worse in length of time than the one Governor Mandel mentioned, a major end of an interstate cross-country system which finally ends in Seattle. From the crest of the Snoqualmie Pass west to Seattle is about 50 miles and we have approximately 15 interstate projects in that length.

A year ago every single one of the 15 projects, some of which had been placed under construction and then stopped; some of which were stopped at various stages of the planning process, all 15 projects were stalled because of various hearing requirements, court suits, decisions of the circuit and appeals courts on various environmental problems.

What originally started out to be the necessary costs for completion of that stretch, $200 million or $300 million, is now well over $1 billion for completion of what admittedly is a very complex stretch of Interstate System. And only now are we beginning to get some of those elements out from under the court suits, which in one case has held the major crossing of Lake Washington to get into Seattle, a project which went to its first hearing in 1960; and it is 15 years later and the cost of that project has escalated from $100 million to a project which has shrunk in scope and size by almost half, and the total cost will be over $400 million for that one area.

We are still not at the point where we have approval of it.

Senator BENTSEN. I guess we each have our stories on these things. I had one on an expressway across San Antonio where we had two launching plans out there for 11 years blocked. I think it was about 5 acres they were taking off the corner of a 200- or 300-acre park. I took that one on and we finally won it.

But I wish you had seen the mail I got in the process while I was trying to save working people some time getting back and forth across town to their jobs so they could spend more time with their families.

There is hope on some of these.

I appreciate very much your testimony. Do you have anything further?

I would like to preserve some time.

Governor RAMPTON. We will get the supplemental information to

you.

Senator BENTSEN. I know some of the Senators would like to submit questions to you. Thank you.

Mr. Ritchie, I apologize to you, sir. You were very considerate in letting them testify.

You go ahead, sir.

STATEMENT OF WILLIAM S. RITCHIE, JR., PRESIDENT, AMERICAN ASSOCIATION OF STATE HIGHWAY AND TRANSPORTATION OFFICIALS-Resumed

Mr. RITCHIE. I think we are talking about really three different items today, and the one that is uppermost on the Governors' minds as well as ours is the creation of jobs in this country in construction because of the high unemployment rate.

The figures we discussed with Senator Randolph, and we will prepare a written reply. to his questions and submit them to him in the next day or so, but I think the creation from each $1 billion of over 150,000 positions, and 126,000 of those generated in the actual construction work in the administration of the contracts, is a very important part of being able to obligate these funds as quickly as possible, that all States want to do.

But in order to do this, we feel there should be some temporary relief from the matching requirements of title 23 at this time to permit us to do this part of our work.

The other item of paramount importance, I feel, is the flexibility of funds that has been discussed here this morning: to give us the ability to transfer between items of apportionment, especially in light of the release of added funds.

We have discussed the length of time, and you are quite familiar with it, sir, that 7 or 8 years, that the projects we do have on-shelf, and we have money to build those projects in some other line item.

This is especially true between the rural and the urban areas. I think it is pointed out as of March 31 of this year, the States had obligated 17 percent of their noninterstate funds inside the urbanized areas, and 83 percent outside of the urbanized areas.

I think that points the problem out that we have of building in the urban and outside, which would indicate that you would have funds in the urban areas that you could not obligate in this period of time that we could obligate in the nonurbanized areas.

So I think that if these provisions could be made and some change in being able to transfer between line items, and possibly an extension to make the term longer than June 30, this would be appreciated by all the States.

Senator BENTSEN. What do you think if you moved it up to September 30? Would that be adequate?

Mr. RITCHIE. My personal opinion is that it would be.
Mr. STAFSETH. It would help considerably.

Mr. RITCHIE. It seems in the first 60 days following the release of the impounded funds, the States were obligating funds at the rate of $31 million per working day. To fully utilize these funds before June 30, we would have to step that up to $45 million per working day. That is quite a jump.

am sure, as you know, the easy projects come first and the ones that are harder to achieve would be on the end of it.

Senator BENTSEN. This freedom to transfer funds in the four categories; a number of States are interested in transferring out of the interstate.

Has your organization taken a position on that?

Mr. RITCHIE. Our policy position has been against that.

Senator BENTSEN. Are you speaking in the past or the present? Mr. RITCHIE. One just established last week.

Senator BENTSEN. Why?

Mr. RITCHIE. I think it is in the interest of all the States, as the Governor mentioned, to be sure we complete the interstate to make it a workable system as soon as possible. I know in my State that is very important to us.

In West Virginia, a 3-mile section not completed is as bad as 100 miles in Kansas. We have some short sections we need to complete very urgently.

Senator BENTSEN. Would you give us a list of the States you feel could not match the recently released $2 billion? Can you work up a list? Would that be a problem for you?

Mr. STAFSETH. Yes, it would be a problem, Mr. Chairman. There seems to be some concerns of the Governors and some of our State departments could be embarrassed if they represented something contrary to the wishes of the Governors.

There are some States which have some difficulties, but we would like to pass that question, if we may.

Mr. RITCHIE. There are many other ways in lots of States that the money could be expended that they could make use of, as the Governors pointed out earlier, if the money was 100-percent grant, which the highway departments would not be familiar with.

Senator BENTSEN. All right.

Mr. RITCHIE. If I might mention one other thing, Senator, that troubles us. The Governors discussed earlier the long-term financing problems that we are going to be facing. If I might mention those this morning, that States-we base our fiscal projections on a growth factor of between 4 and 5 percent a year. And because of the energy situation, the reaction to it, this growth factor is not there. The growth is leveling off and indications are that it will be the same this year, the income the same as last year.

Construction costs have escalated over 30 percent in the same period of time. If we look down the road a little bit and look at the effect that just a better operating vehicle or better mileage per gallon of gas would have, by 1980 we estimate-not we estimate, but the Ways and Means Committee roughly estimated just from automobile efficiency by 1980 there would be a minus 3.8 billion gallons of gas used per year.

If you consider on top of that an increase cost equivalent to 25 cents per gallon would be imposed, by 1980 would reduce consumption by minus 8.4 billion gallons a year.

The taxes collected by the States on that lesser amount of gasoline is I think what the Governors were referring to as a big problem we are all going to face as far as maintenance of higher priced highways is concerned.

Senator BENTSEN. Are you concerned that the House bills on the environmental impact are not clearly enough drawn, and they result in just more delays and litigation?

Mr. RITCHIE. If I understand the House bills correctly, they are intended to continue what we have been doing, which is working as well as can be expected right now. Of course, it doesn't work as well as we would like for it to. But I think the States and the Federal Highway Administration have developed procedures to the point that we consider every possibility in the preparation of our environmental impact statements.

Senator BENTSEN. I believe one of them amends EPA.

Mr. RITCHIE. If we could continue the way we have, and I have my story in my State, the same as everybody else does, that we had a bridge funded by 100-percent State funds with no Federal funds.

By having a Federal agency, in this case the Coast Guard, the lead agency that prepared the environmental statement, and because it was a controversial location, this entered into the fact that the Federal Government was preparing the environmental statement.

A decision was withheld for a period of about 3 years. The cost of the structure went from someplace in the neighborhood of $8 million that we had in a bond program to construct it, and you know, you have to review the cost estimate daily, but the last day I looked at it it was in the neighborhood of $18 million to $20 million.

There isn't a penny of Federal aid in it. We are building it right where we proposed 3 years ago. So this is a problem that we see in the Federal Government, preparing all environmental impact statements. The period of time in the first place it would take the Federal Government to hire the 1,800 to 2,000 people that Governor Tiemann suggested would be necessary. There is no question in my mind he is going to be looking at our State people to do those jobs because they have the expertise. Then the period of time it will take for environmental statements to be written and approved will be, in my estimation, tremendous.

Senator BENTSEN. Thank you very much, Mr. Ritchie, and Mr. Stafseth. You had another comment?

Mr. STAFSETH. I would like to emphasize one comment that our president made, and that is we have reviewed the question you asked about the two environmental bills as to whether they are satisfactory. Our attorney says that he thinks it will correct the situation and will not entail any more activity and will carry out the processes. So either bill is satisfactory.

[The following information was subsequently supplied:] AMERICAN ASSOCIATION OF STATE HIGHWAY AND

Hon. JENNINGS RANDOLPH,

TRANSPORTATION OFFICIALS,
Washington, D.C. May 2, 1975.

Chairman, Senate Public Works Committee, Washington, D.C.

DEAR MR. CHAIRMAN: We wish to thank you for the opportunity of testifying before your Subcommittee on Transportation, in which we addressed S. 681, S. 952, H.R. 3786, H.R. 3787, and H.R. 3130.