THE FUNDING OF OUR HIGHWAYS: LASTING BLASTS FROM THE PAST

LAND AND FREEDOM VOL. XXVII No. 1  January/February, 1927

Where Senator Richards Errs

JOHN J. EGAN

SENATOR EMERSON RICHARDS recently delivered an address before the Newark Real Estate Board on the financing of State highways. He advocated a gasoline tax and the quadrupling of the annual license tax on commercial motor vehicles, his idea being that those who use highways should pay for this use a revival of the obsolete toll-road system. The Senator touched but lightly upon the fact that there are others than road users who benefit from the establishment and upkeep of paved highways. He did not, as he well might have done, explain that the only values to be created or increased by the substitution of good roads for poor ones are location or site values.

The Senator knows very well that municipalities assess the cost of highway improvements against contiguous lot holders, this course being legally and morally justifiable. It may well be asked why this Senator, other legislators and the Governor himself do not turn their attention to the possibility of establishing a system by which a large part of the cost of paved highways may be drawn from the holders of locations that are especially benefited, making the assessment levies payable over a period of five or ten years.

There is no reason why New Jersey should follow the bad example of other states in penalizing transportation, industry and trade by a gasoline tax or by the imposition of heavy commercial license fees. Equity demands a revision of our methods of financing highway construction, and the responsibility is upon our legislators to contrive that the revision be in conformity with common sense and good morals rather than with the practice or customs elsewhere. We of New Jersey are entitled to the best system of financing highways that can be devised.

The revision of highway financing should be deferred until there can be a full inquiry into the possibility of accompanying new highway construction with a State system of assessing abutting and contiguous land holders on the basis of the Site-Value created by improved roads.

New Jersey’s Governor

GOVERNOR A. HARRY MOORE of New Jersey, in his first annual message to the 1927 Legislature, after discussing several methods of financing new highway construction, said: “Lastly, I might suggest to you the wisdom of assessing some part of the cost of the road system upon the land specially benefited thereby, as is the practice in municipal improvements. A striking illustration of what might be regarded as an evil of having the State at large pay for major improvements and the land peculiarly benefited by the improvements escape, except in so far as it shares its proportions of the state’s expenses, is in the increase of land values in Bergen county, which came as a result of the projected Hudson River Bridge.”
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From Herbert H Asquith, Prime Minister United Kingdom 1908 – 1916:

The value of land rises as population grows and national
necessities increase, not in proportion to the application
of capital and labour, but through the development of the
community itself. You have a form of value, therefore, which is
conveniently called ‘site value,’ entirely independent of buildings
and improvements and of other things which non-owners and
occupiers have done to increase its value – a source of value
created by the community, which the community is entitled to
appropriate to itself. …In almost every aspect of our social and
industrial problem you are brought back sooner or later to that
fundamental fact.