Pert E PIN OF TIE 
USDEPARIMENT OTAQRCULIURE *; 
No. 1386 
Contribution by the Office of Public Roads, L. W. Page, Director. 
February 12, 1915. 
HIGHWAY BONDS: 
A COMPILATION OF DATA AND AN ANALYSIS OF ECONOMIC FEATURES 
AFFECTING CONSTRUCTION AND MAINTENANCE OF HIGHWAYS 
FINANCED BY BOND ISSUES, AND THE THEORY OF HIGHWAY 
BOND CALCULATIONS. 
By Laurence I. Hewes, Chief, Economics and Maintenance, Office of Public Roads, 
and JAMES W. GLoverR, Professor of Mathematics and Insurance, University of 
Michigan, Collaborator, Office of Public Roads. 
TABLE OF CONTENTS. 
Pages) Page. 
ATELOUUICHION Mae ee ns ws ek es Se 3 | Appendix B.—Approximate lists of county 
Couniiyshichways ease). so seen ae 5 | and district highway and bridge bonds.... 37 
Economic value of the market road.-.._..._.- 6 Appendix C.—Table showing cost elements 
Cost of highway construction...-............ 10 | of gravel, macadam, and bituminous mac- 
Cost of highway maintenance............-..- 12 | adam roads in Maine, Massachusetts, and 
ARE DOMsSSUIOs 4 5-Son eee eee ag eeENGwilersogs eertre ls. tur Aaa eee Soe 86 
Motalcosiothighwayssaa ses - ae eae 24 | Appendix D.—Theory of interest applied to 
Expediency of issuing highway bonds..-.... 27 highway bond calculations ...........--- 91-129 
Appendix A.—State highway bonds........- 34 | index:.toA\p pend ixe aes fee eee eee 91 
INTRODUCTION. 
The practice of issuing bonds for highway and bridge construction 
by counties and their subdivisions has become common. In 1,230 
counties, or 41.1 per cent of all the counties in this country, there were 
outstanding highway bonds on January 1, 1914. The total amount 
of such bonds voted,! as ascertained by the Office of Public Roads up 
to that date, was $286,557,073, of which township bonds alone 
amounted to $57,153,718. The amount of outstanding local highway 
bonds on January 1, 1913, was approximately $202,007,776. This 
amount was increased during the year 1913 by current issues noted 
below, but was also slightly decreased by maturing payments. 
The county highway bond is essentially a municipal bond; that is, a 
bond issued by a public corporation. Statistics indicate that all 
municipal bonds constitute about 20 per cent of the total of all bonds 
issued, while Government bonds are about 10 per cent. Municipal 
bonds are regarded as excellent investments and are frequently used 
by banks as asecond reserve. The amount of highway bonds issued 
is indicated by comparison with the $79,741,688 of irrigation and 
drainage bonds authorized in the interval from 1907 to 1912, inclusive. 
'“WVoted”’ is almost equivalent to ‘‘issued,’’ except in State highway bonds. The difference between 
bonds voted and bonds sold in 1912 was a little over 3 per cent. 
5 
