B-142793, AUGUST 25, 1960, 40 COMP. GEN. 122

B-142793: Aug 25, 1960

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EVEN THOUGH THE ADVERTISING RIGHTS ARE ACQUIRED IN AN AREA ADJACENT TO A SEGMENT OF THE HIGHWAY SYSTEM WHICH IS EXCLUDED FROM THE NATIONAL POLICY AND STANDARDS. IS IN ACCORD WITH THE LEGISLATIVE HISTORY OF THE LAW. THE SECRETARY OF COMMERCE IS AUTHORIZED BY SUBSECTION (B). WITH FEDERAL AGENCIES WITH RESPECT TO ANY PORTION OF THE SYSTEM WHICH IS LOCATED UPON OR ADJACENT TO ANY PUBLIC LANDS OR RESERVATIONS. THE ASSISTANT SECRETARY STATES THAT SUBSECTION (E) HAS BEEN INTERPRETED BY THE DEPARTMENT OF COMMERCE TO MEAN THAT FEDERAL-AID HIGHWAY FUNDS MAY PARTICIPATE IN THE COST TO A STATE OF ACQUIRING ADVERTISING RIGHTS IF THE PURPOSE OF SUCH ACQUISITION IS TO ACCOMPLISH THE OBJECTIVES STATED IN SUBSECTION (A).

B-142793, AUGUST 25, 1960, 40 COMP. GEN. 122

FEDERAL-AID HIGHWAY SYSTEM - ADVERTISING CONTROL - FEDERAL FUNDS AVAILABILITY THE USE OF FEDERAL-AID HIGHWAY FUNDS TO PARTICIPATE IN THE COST TO THE STATES OF THE ACQUISITION OF ADVERTISING RIGHTS UNDER 23 U.S.C. 131 (E), IF THE PURPOSE OF THE ACQUISITION ACCOMPLISHES THE OUTDOOR ADVERTISING CONTROL OBJECTIVES IN 23 U.S.C. 131 (A), WITHOUT REGARD TO THE CONDITIONS AND LIMITATIONS IN SUBSECTION (B) CONCERNING THE EXECUTION OF AGREEMENTS WITH THE STATES AND, EVEN THOUGH THE ADVERTISING RIGHTS ARE ACQUIRED IN AN AREA ADJACENT TO A SEGMENT OF THE HIGHWAY SYSTEM WHICH IS EXCLUDED FROM THE NATIONAL POLICY AND STANDARDS, IS IN ACCORD WITH THE LEGISLATIVE HISTORY OF THE LAW.

TO THE SECRETARY OF COMMERCE, AUGUST 25, 1960:

BY LETTER OF MAY 3, 1960, THE HONORABLE GEO. T. MOORE, ASSISTANT SECRETARY OF COMMERCE, PRESENTED FOR OUR CONSIDERATION A QUESTION WHICH HAS ARISEN IN CONNECTION WITH THE ADMINISTRATION OF SECTION 12 OF THE FEDERAL-AID HIGHWAY ACT OF 1958, PUBLIC LAW 85-381, 72 STAT. 95.

SECTION 12 OF THE ACT, WHICH HAS BEEN CODIFIED AS 23 U.S.C. 131, CONTAINS PROVISIONS RELATIVE TO THE CONTROL OF OUTDOOR ADVERTISING IN AREAS ADJACENT TO THE NATIONAL SYSTEM OF INTERSTATE AND DEFENSE HIGHWAYS. SUBSECTION (A), 23 U.S.C. 131 (A), PROVIDES FOR THE PREPARATION AND PROMULGATION BY THE SECRETARY OF COMMERCE OF NATIONAL STANDARDS FOR SUCH CONTROL. THE SECRETARY OF COMMERCE IS AUTHORIZED BY SUBSECTION (B), 23 U.S.C. 131 (B), TO ENTER INTO AGREEMENTS WITH STATE HIGHWAY DEPARTMENTS WITH RESPECT TO THE CONTROL OF OUTDOOR ADVERTISING ADJACENT TO THE SYSTEM WITHIN THE STATE AND BY SUBSECTION (D), 23 U.S.C. 131 (D), WITH FEDERAL AGENCIES WITH RESPECT TO ANY PORTION OF THE SYSTEM WHICH IS LOCATED UPON OR ADJACENT TO ANY PUBLIC LANDS OR RESERVATIONS. SUBSECTION (C), 23 U.S.C. 131 (C), PROVIDES FOR AN INCREASE OF ONE-HALF OF ONE PERCENT IN THE FEDERAL SHARE OF THE COSTS OF AFFECTED PROJECTS IN STATES WHICH ENTER INTO THE AGREEMENTS PROVIDED BY SUBSECTION (B), AND SUBSECTION (E), 23 U.S.C. 131 (E), PROVIDES THAT THE COST OF ACQUISITION OF ADVERTISING RIGHTS IN AN AREA ADJACENT TO A PROJECT ON THE SYSTEM FOR THE PURPOSE OF IMPLEMENTING SECTION 12 SHALL BE CONSIDERED PART OF THE COST OF CONSTRUCTION OF THE PROJECT AND FEDERAL FUNDS MAY BE USED TO PAY THE PRO RATA SHARE OF SUCH COST NOT IN EXCESS OF 5 PERCENT OF THE COST OF THE RIGHT-OF-WAY OF THE PROJECT.

THE QUESTION PRESENTED CONCERNS FEDERAL PARTICIPATION IN THE COST OF ACQUIRING ADVERTISING RIGHTS. THE ASSISTANT SECRETARY STATES THAT SUBSECTION (E) HAS BEEN INTERPRETED BY THE DEPARTMENT OF COMMERCE TO MEAN THAT FEDERAL-AID HIGHWAY FUNDS MAY PARTICIPATE IN THE COST TO A STATE OF ACQUIRING ADVERTISING RIGHTS IF THE PURPOSE OF SUCH ACQUISITION IS TO ACCOMPLISH THE OBJECTIVES STATED IN SUBSECTION (A), EVEN THOUGH THE STATE HAS NOT ENTERED INTO AN AGREEMENT WITH THE SECRETARY OF COMMERCE AS PROVIDED FOR IN SUBSECTION (B), AND EVEN THOUGH THE ADVERTISING RIGHTS ARE ACQUIRED IN AN AREA ADJACENT TO A SEGMENT OF THE SYSTEM WHICH IS EXCLUDED FROM THE APPLICATION OF THE NATIONAL POLICY AND STANDARDS BY THE TERMS OF THE LAW. OUR OPINION ON THIS INTERPRETATION IS REQUESTED.

TWO SUBSECTIONS OF SECTION 12 PROVIDE FOR ADDITIONAL INCENTIVE PAYMENTS IN CONNECTION WITH THE CONTROL OF OUTDOOR ADVERTISING IN AREAS ADJACENT TO THE SYSTEM. THESE SUBSECTIONS, (C) AND (E), PROVIDE RESPECTIVELY AS FOLLOWS:

(C) FEDERAL SHARE.--- NOTWITHSTANDING THE PROVISIONS OF SECTION 2 OF THE FEDERAL-AID HIGHWAY ACT OF 1944 (58 STAT. 838), IF AN AGREEMENT PURSUANT TO THIS SECTION HAS BEEN ENTERED INTO WITH ANY STATE PRIOR TO JULY 1, 1961, THE FEDERAL SHARE PAYABLE ON ACCOUNT OF ANY PROJECT ON THE INTERSTATE SYSTEM WITHIN THAT STATE PROVIDED FOR BY FUNDS AUTHORIZED UNDER THE PROVISIONS OF SECTION 108 OF THIS ACT, TO WHICH THE NATIONAL POLICY AND THE AGREEMENT APPLY, SHALL BE INCREASED BY ONE HALF OF ONE PERCENTUM OF THE TOTAL COST THEREOF, NOT INCLUDING ANY ADDITIONAL COST THAT MAY BE INCURRED IN THE CARRYING OUT OF THE AGREEMENT: PROVIDED, THAT THE INCREASE IN THE FEDERAL SHARE WHICH IS PAYABLE HEREUNDER SHALL BE PAID ONLY FROM APPROPRIATIONS FROM MONEYS IN THE TREASURY NOT OTHERWISE APPROPRIATED, WHICH SUCH APPROPRIATIONS ARE HEREBY AUTHORIZED.

(E) WHENEVER A STATE SHALL ACQUIRE BY PURCHASE OR CONDEMNATION THE RIGHT TO ADVERTISE OR REGULATE ADVERTISING IN AN AREA ADJACENT TO THE RIGHT-OF- WAY OF A PROJECT ON THE INTERSTATE SYSTEM FOR THE PURPOSE OF IMPLEMENTING THIS SECTION, THE COST OF SUCH ACQUISITION SHALL BE CONSIDERED AS A PART OF THE COST OF CONSTRUCTION OF SUCH PROJECT AND FEDERAL FUNDS MAY BE USED TO PAY THE FEDERAL PRO RATA SHARE OF SUCH COST: PROVIDED, THAT REIMBURSEMENT TO THE STATE SHALL BE MADE ONLY WITH RESPECT TO THAT PORTION OF SUCH COST WHICH DOES NOT EXCEED 5 PERCENTUM OF THE COST OF THE RIGHT-OF -WAY FOR SUCH PROJECT.

IT IS NOTED THAT THE ADDITIONAL PAYMENT PROVIDED FOR BY SUBSECTION (C) IS SPECIFICALLY CONDITIONED UPON THE STATE ENTERING INTO AN AGREEMENT AS PROVIDED BY SUBSECTION (B), AND THAT THE PAYMENT IS SPECIFICALLY LIMITED TO PROJECTS TO WHICH THE NATIONAL POLICY AND THE AGREEMENT APPLY. SINCE NO SUCH CONDITION OR LIMITATION IS CONTAINED IN SUBSECTION (E), IT WOULD BE REASONABLE TO BELIEVE THAT NO SUCH CONDITION OR LIMITATION WAS INTENDED TO APPLY TO THE PAYMENT CONTEMPLATED THEREBY. HOWEVER, THE WORDS "FOR THE PURPOSE OF IMPLEMENTING THIS SECTION" CONTAINED IN SUBSECTION (E) POSSIBLY COULD BE CONSTRUED AS ATTACHING THE CONDITIONS AND LIMITATIONS EXPRESSED IN OTHER PORTIONS OF THE SECTION TO THE PAYMENTS CONTEMPLATED BY SUBSECTION (E). IN VIEW OF THE AMBIGUITY, IT IS NECESSARY TO RESORT TO THE LEGISLATIVE HISTORY OF THE SECTION 12 TO DETERMINE THE INTENT OF THE CONGRESS.

THE CONFERENCE REPORT (H.1REPT. NO. 1591) ON H.R. 9821, 85TH CONGRESS, WHICH BECAME THE FEDERAL AID HIGHWAY ACT OF 1958, CONTAINS ON PAGE 17 THE FOLLOWING STATEMENT REGARDING SUBSECTION (E) OF SECTION 12:

SUBSECTION (E) PROVIDES THAT WHENEVER A STATE SHALL ACQUIRE BY PURCHASE OR CONDEMNATION THE RIGHT TO ADVERTISE OR REGULATE ADVERTISING IN AN AREA ADJACENT TO THE RIGHT-OF-WAY ON A PROJECT OF THE INTERSTATE SYSTEM FOR THE PURPOSE OF CARRYING OUT THE POLICY SET FORTH IN THIS NEW SECTION 122 THE COST OF SUCH ACQUISITION SHALL BE CONSIDERED AS A PART OF THE CONSTRUCTION COST OF THE PROJECT WITH THE LIMITATION THAT FEDERAL FUNDS NOT IN EXCESS OF 5 PERCENT OF THE COST OF THE RIGHT-OF WAY FOR SUCH PROJECT MAY BE USED TO REIMBURSE THE STATE FOR THE ACQUISITION OF SUCH ADJACENT AREA. (ITALICS SUPPLIED.)

THIS STATEMENT WOULD INDICATE THAT THE WORDS "FOR THE PURPOSE OF IMPLEMENTING THIS SECTION" IN SUBSECTION (E) PERTAIN ONLY TO THE CARRYING OUT OF THE NATIONAL POLICY SET FORTH IN SUBSECTION (A) AND HAVE NO REFERENCE TO THE AGREEMENTS AND TO THE CONDITIONS AND LIMITATIONS ON OTHER PAYMENTS SET OUT IN OTHER SUBSECTIONS OF SECTION 12. A SUBSTANTIALLY IDENTICAL STATEMENT WAS MADE ON THE FLOOR OF THE HOUSE OF REPRESENTATIVES BY REPRESENTATIVE BLATNIK IN DISCUSSING THE BILL ON APRIL 3, 1958 (104 CONG.REC. 6244 (1958) ).

WHILE THERE IS NOTHING IN THE SENATE REPORT ON S. 3414, COMPANION BILL TO H.R. 9821 (S.1REPT. NO. 1407), WHICH WOULD AID IN INTERPRETING THIS SUBSECTION, THE DEBATE THEREON ON THE SENATE FLOOR CONTAINS SEVERAL REFERENCES TO THE EXACT POINT HERE IN QUESTION. IN THE COURSE OF A DISCUSSION ON MARCH 26, 1958, OF THE EFFECTS OF SENATOR COTTON'S AMENDMENT LIMITING THE POLICY STATEMENT EXPRESSED IN SUBSECTION (A) OF SECTION 12 TO THOSE PORTIONS OF THE SYSTEM CONSTRUCTED UPON RIGHTS-OF WAY, THE ENTIRE WIDTH OF WHICH IS ACQUIRED SUBSEQUENT TO JULY 1, 1956, THE FOLLOWING STATEMENTS WERE MADE:

MR. COTTON. IF THE SENATOR FROM CALIFORNIA WILL YIELD, DID HE INTEND TO SAY IF MY AMENDMENT WERE ADOPTED IT WOULD DEPRIVE THE STATES OF THE RIGHT TO CONTROL THE OTHER SEGMENTS OF HIGHWAY? THE AMENDMENT WOULD TAKE NOTHING FROM THE STATES WHATSOEVER.

MR. KUCHEL. I SAID THAT IN MY OPINION, IF THE AMENDMENT OF THE SENATOR FROM NEW HAMPSHIRE WERE ADOPTED, IT WOULD DEPRIVE THE STATES OF PARTICIPATING IN A FEDERAL INCENTIVE PAYMENT, TO THE EXTENT OF APPLYING THE NATIONAL POLICY OVER THAT PART OF THE INTERSTATE HIGHWAY SYSTEM WHERE NEW RIGHTS OF WAY WERE REQUIRED.

MR. COTTON. THE STATES WOULD GET PAYMENT FOR THOSE PORTIONS OF THE HIGHWAY WHICH WERE CONTROLLED, EXACTLY AS THEY WOULD UNDER THE BILL AS NOW WRITTEN. IT WOULD SAVE THE STATES FROM GETTING THEIR NOSES INTO A LOT OF TROUBLE.

MR. CASE OF SOUTH DAKOTA. MR. PRESIDENT, I SHOULD LIKE TO ASK THE AUTHOR OF THE AMENDMENT IF HE DOES NOT FEEL THE STATE, IN THE SITUATION DESCRIBED BY THE SENATOR FROM CALIFORNIA, MIGHT STILL BE ELIGIBLE TO GET HELP ON THE PURCHASE OF RIGHTS, IF THE STATE DECIDED TO SEEK TO PURCHASE RIGHTS WHERE THE ADVERTISING IS IN EXISTENCE?

MR. COTTON. I THINK THAT PARTICIPATING IN THE PURCHASE OF RIGHTS WOULD NOT BE AFFECTED BY THE LIMITATION ANY MORE THAN IT WOULD BE AFFECTED BY THE LIMITATIONS ALREADY IN THE BILL.

MR. CASE OF SOUTH DAKOTA. MY READING OF THE LANGUAGE LEADS ME TO BELIEVE IT IS ONLY APPLICABLE WITH RESPECT TO THE SO-CALLED INCENTIVE PAYMENT, BUT WOULD NOT INTERFERE WITH THE STATE GETTING HELP ON THE PURCHASE COST OF EASEMENTS. (104 CONG.REC. 5398 (1958.) (

MR. GORE. MR. PRESIDENT, UPON LISTENING TO THE STATEMENT OF THE JUNIOR SENATOR FROM NEW HAMPSHIRE AS TO HIS INTENT AND AS TO HIS UNDERSTANDING OF THE MEANING OF THE AMENDMENT, I REACHED THE CONCLUSION THAT IT IS NOT AS FAR REACHING AS I HAD ORIGINALLY THOUGHT. IT IS STILL, HOWEVER, A RESTRICTIVE AMENDMENT. IF I MAY HAVE THE ATTENTION OF THE JUNIOR SENATOR FROM NEW HAMPSHIRE, I SHOULD LIKE TO POINT OUT THAT ANY SECTION OF THE HIGHWAY, ANY PART OF WHICH ENCOMPASSED ANY PART OF A RIGHT-OF-WAY WHICH A STATE OWNED PRIOR TO JULY 1, 1956, COULD NOT BE REGULATED UNDER THE TERMS OF THE AGREEMENT. THE PROVISION BEGINNING AT THE BOTTOM OF PAGE 23, LINE 24, WHICH PROVIDES FOR REIMBURSEMENT OF A STATE FOR 90 PERCENT OF THE COST OF THE ACQUISITION OF THE RIGHT-OF-WAY, COULD APPLY, BECAUSE IT CAN APPLY WITHOUT THE REACHING OF AN AGREEMENT.

THEREFORE, THE EFFECT OF THE AMENDMENT, UPON FURTHER CONSIDERATION, WOULD NOT BE AS FAR REACHING AS THE JUNIOR SENATOR FROM TENNESSEE HAD ORIGINALLY THOUGHT. IT WOULD OPERATE, IT WOULD SEEM TO ME, AS A DISCRIMINATION AGAINST THE STATES. SUPPOSE THAT THE STATES WANTED TO EXERCISE THE REGULATION AND DESIRED TO ACQUIRE THE ADVERTISING EASEMENTS AND PROCEEDED TO DO SO. THEY COULD BE REIMBURSED TO THE EXTENT OF 90 PERCENT OF THE COST OF ACQUIRING THE EASEMENTS PROVIDED THE COST DID NOT EXCEED 5 PERCENT OF THE RIGHT-OF-WAY COST, BUT THEY WOULD BE DENIED THE OTHER FINANCIAL INCENTIVE OF ONE-HALF OF 1 PERCENT OF THE COST OF THE PROJECT.

MR. CASE OF SOUTH DAKOTA. I WELCOME THE STATEMENT OF THE SENATOR FROM TENNESSEE, BECAUSE IT COINCIDES COMPLETELY WITH THE OBSERVATION I MADE EARLIER, THAT THE AMENDMENT OFFERED BY THE SENATOR FROM NEW HAMPSHIRE DOES NOT DEPRIVE THE STATE OF ITS RIGHT TO GET A PART OF THE COST OF ACQUIRING THE RIGHTS.

THE LANGUAGE AT THE BOTTOM OF PAGE 23 SAYS: "WHENEVER A STATE SHALL ACQUIRE.'

IT DOES NOT SAY WHENEVER A STATE ENTERS INTO AN AGREEMENT. IT SAYS: "WHENEVER A STATE SHALL ACQUIRE BY PURCHASE OR CONDEMNATION THE RIGHT TO ADVERTISE OR REGULATE ADVERTISING" IT SHALL BE ENTITLED, AND SO FORTH.'

MR. GORE. THE SENATOR AGREES WITH MY INTERPRETATION OF THE AMENDMENT. IS THAT CORRECT?

MR. CASE OF SOUTH DAKOTA. THAT IS WHAT I SUGGESTED EARLIER. (104 CONG. REC. 5399 AND 5400.)

SUBSEQUENTLY, ON APRIL 3, 1958, SENATOR GORE MADE THE FOLLOWING STATEMENT ON THE FLOOR OF THE SENATE DURING DISCUSSION ON THE CONFERENCE REPORT ON H.R. 9821:

THERE HAS BEEN SOME MISUNDERSTANDING WITH REGARD TO THE PROVISIONS OF THE CONFERENCE REPORT RELATING TO THE PROMULGATION OF STANDARDS AND UNIFORM REGULATION OF BILLBOARD ADVERTISING IN AREAS ADJACENT TO THE RIGHT OF WAY. I HAVE READ EDITORIALS, FOR INSTANCE, WHICH HAVE CONTAINED STATEMENTS THAT THE PROPOSED LEGISLATION EXCEPTS APPROXIMATELY 35 PERCENT OF THE HIGHWAYS FROM APPLICATION OF THE PROVISION. THIS IS NOT TRUE. THE AMENDMENT OFFERED BY THE DISTINGUISHED JUNIOR SENATOR FROM NEW HAMPSHIRE (1MR. COTTON) APPLIES ONLY TO THE PORTION OF THE PROPOSAL UNDER CONSIDERATION BY WHICH STATES WILL BE GIVEN ONE-HALF OF 1 PERCENT OF THE COST OF THE PROJECTS IN THE EVENT THEY REGULATE OUTDOOR ADVERTISING IN ACCORDANCE WITH THE PRESCRIBED STANDARDS. THE AMENDMENT DOES NOT APPLY TO THE OTHER PROVISIONS, WHEREBY STATES WILL BE REIMBURSED FOR 90 PERCENT OF THE COST OF THE PURCHASE OF ADVERTISING EASEMENTS, TO THE EXTENT OF 5 PERCENT OF THE COST OF THE RIGHT-OF-WAY. IN OTHER WORDS, UNDER THE PROVISIONS OF THE BILL ANY STATE CAN COMPLY WITH THE STANDARDS TO BE PROMULGATED BY THE SECRETARY OF COMMERCE ON 100 PERCENT OF THE MILEAGE ON THE INTERSTATE SYSTEM WITHIN ITS BORDER.

IN SOME INSTANCES PERHAPS IT WILL BE TRUE THAT A SMALL COST WILL BE BORNE BY THE STATES--- AT LEAST 10 PERCENT OF THE COST OF ACQUISITION OF ADVERTISING EASEMENT, PLUS THAT PORTION OF THE COST OF THE ADVERTISING EASEMENTS WHICH EXCEEDS 5 PERCENT OF THE COST OF THE RIGHT-OF-WAY ON THOSE PORTIONS WHICH ARE EXCLUDED FROM THE ONE-HALF PERCENT INCENTIVE PROVISION BY THE SO-CALLED COTTON AMENDMENT.

I OPPOSED THE AMENDMENT OFFERED BY THIS JUNIOR SENATOR FROM NEW HAMPSHIRE. HOWEVER, IT DOES NOT RENDER THE PROVISION INOPERATIVE ON ANY PORTION OF THE INTERSTATE SYSTEM PROVIDED THE STATE PURCHASES THE EASEMENT. * * * (104 CONG. REC. 6191 (1958.) THE ABOVE SEEMS TO FURNISH ADEQUATE SUPPORT FOR THE INTERPRETATION PLACED UPON SUBSECTION (E) OF SECTION 12 BY YOUR DEPARTMENT AS SET OUT IN THE LETTER OF MAY 3, 1960, FROM THE ASSISTANT SECRETARY. THAT IS TO SAY, FEDERAL-AID HIGHWAY FUNDS MAY PARTICIPATE IN THE COST TO A STATE OF ACQUIRING ADVERTISING RIGHTS IF THE PURPOSE OF SUCH ACQUISITION IS TO ACCOMPLISH THE OBJECTIVES STATED IN SUBSECTION (A) EVEN THOUGH THE STATE HAS NOT ENTERED INTO AN AGREEMENT WITH THE SECRETARY OF COMMERCE AS PROVIDED FOR IN SUBSECTION (B), AND EVEN THOUGH THE ADVERTISING RIGHTS ARE ACQUIRED IN AN AREA ADJACENT TO A SEGMENT OF THE SYSTEM WHICH IS EXCLUDED FROM THE APPLICATION OF THE NATIONAL POLICY AND STANDARDS BY THE TERMS OF THE LAW. ACCORDINGLY, OUR OFFICE WOULD NOT BE WARRANTED IN OBJECTING TO SUCH INTERPRETATION.