Extracts from an Address of Governor Ellis
Arnall to The Joint Session of The General Assembly of Georgia on March 3, 1943.
While the most important demand upon our State and its citizens is the winning of the war, yet we must not let the home front collapse in our all-out war effort.
It is my belief that the people of Georgia are as patriotic as those of any other State in the Union. I am of the considered opinion that the people of Georgia are demanding that we do everything possible to cooperate with the effort of the Federal Administration to the end that we may speedily defeat the forces of brutality which are seeking to deprive our people of liberty, freedom, democracy and the right to happiness.
As Governor of this State, I have a responsibility to give to the members of the General Assembly and to the people a true picture of State affairs and tell them what is happening in Georgia.
Quite frankly, I am distressed, perturbed and worried about State finances. I feel it my duty to let you know that the State Government is headed for financial collapse; that no amount of economy can pay bills unless we have the money with which to pay them.
I think it my duty to advise you that sympathy for the aged, the school teachers, the counties, wards of the State and State functions cannot provide for them, but finally we must have in the State Treasury the dollars with which to pay.
Early in the session I made an estimate of anticipated State income. The estimate was pessimistic. I pointed out the fact that the future was dark. Today I tell you that the pessimistic estimate made was not pessimistic enough; that the dark future has grown blacker and that we are now faced with a situation and a condition which, if unremedied, ultimately will bring chaos to the State Government.
As far as I am concerned if it is necessary for us to stop all State services, leave our children uneducated, stop the entire functions of State Government in order to win the war, then I am in favor of winning the war, but I candidly am impelled to call your attention to the realities with which the State is confronted.
Our State revenue continues to fall off drastically until today if we were to give to the school teachers every dime of gasoline tax under

the present basis, we would still be short eight million dollars in meeting their current salary payments alone.
A great reduction in State revenue has been brought about in the past thirteen months under various plans of gasoline rationing. Up to the present time based on the rate of gasoline tax collections before rationing went into effect the State of Georgia has already lost $7,954,000.00.
The first form of gasoline rationing was a limitation on deliveries to the filling stations. Because of this limitation, the State from January, 1942 to July 22, 1942 averaged a reduction of $474,000.00 per month in collections. This amounts on an annual basis to $5,688,000.00.
On July 22, 1942, the coupon plan of rationing gasoline was put into effect and the loss of gasoline tax receipts was raised to $750,000.00 monthly, or $9,000,000.00 per year.
In December, 1942, the value of the gasoline tax coupons in Georgia was reduced from four to three gallons each and in the early part of January a ban was placed on pleasure driving in this State. In the last two or three weeks Federal Agents have been cracking down on violations of pleasure driving, particularly on Sunday driving. These latest changes have raised the loss in gasoline tax collections to $1,000,000.00 per month or $12,000,000.00 per year.
And we have not yet felt the full force of the ban on pleasure driving, the Federal Agents are now engaged in checking the various localities throughout the State for violations. This last change in rationing will raise our loss in gasoline tax to at least $1,300,000.00 per month or $15,600,000.00 per year and we do not know what other plans are in the offing to further curtail the use of gasoline in Georgia and in the other Seaboard States which are placed in this particular area.
I think it only proper to point out that while the State of Georgia, one of the Seaboard States, is losing $15,600,000.00 in gasoline tax revenue, the States which are not in the Seaboard area did not have rationing until December, 1942, or twelve months after rationing was put into effect in our State. Also in December, 1942, the value of the coupons in the Seaboard States was made to be worth one-fourth less than in the other States. Also the ba.n on pleasure driving extends only to Georgia and the other Seaboard States.
We can attribute $6,600,000.00 of our annual loss in gasoline tax revenue to the reduction of the value of the coupons and the ban on

pleasure driving which is applicable only to Georgia and the other Seaboard States. The other $9,000,000.00 annual loss iP gasoline tax revenue can be attributed to the rationing system as a whole.
And so, factually, the people of Georgia are in effect being called upon not only to submit to gasoline rationing, which we cheerfully and gladly do, but also we are confronted with the ultimate demand that in order to fully cooperate with the Federal rationing program we must also levy approximately $16,000,000.00 in new taxes against the people of the State if we are to carry on the State Government on relatively the same basis upon which it formerly operated.
Do not for a moment think that I am critical of the gasoline rationing system. I care not how discriminatory, unfair, silly or ridiculous some may think Federal regulations may be, as far as I am concerned I am going to cheerfully abide by them and as Governor I shall encourage the people of this State to cooperate with the Federal authorities in every possible respect.
I am proud of the fact that the first order of business of the present session of the General Assembly was to adopt a resolution committing the State Administration to a full and complete policy of cooperation with the Federal authorities in the prosecution and the winning of the war. However, we cannot close our eyes to realities. We must have the courage to face the facts and the facts are such that we must realize serious and difficult days are ahead for Georgia.
The truth of the matter is that we have largely financed the State on gasoline taxes and now that the sale and use of gasoline is so drastically curbed, our State finds itself in a most distressing situation.
It seems to me that we do have some possible recourse. We must be careful not to be critical of Federal regulations but it seems to me that we would be within our full patriotic rights were we to communicate with the Georgia delegation in the Federal Congress and with the Senators and Congressmen of the other Seaboard States as well as with the Federal Congress and Federal Officials and urge them to relax the rigid ban on rationing and consumption of gasoline in the Seaboard States now or at such early time as possible, provided, of course, such relaxation would not in any way interfere with the war effort.
If any relaxation of the ban interferes with the prosecution of the war, then, of course, we would not expect the ban to be relaxed because we are first for winning the war.
The fuel oil shortage in the east and the necessity for heating oil probably is not as keen now due to the fact that the winter season

is rapidly growing to an end and it may be that if this matter is brought to the attention of the Federal authorities in a patriotic noncritical manner that at some early date some system may be worked out which will not interfere in the war effort and will still allow our State and the other Seaboard States some additional revenue from the sale and use of gasoline.
We are told that the reason for rationing 1s the transportation difficulty. It is not our fault but the fault rests with the transportation system of the entire nation. All of the States are in this war together. We are going to win it together or we are going to lose it together. I submit that it might not be out of line to suggest to Congress that in event the restrictions on gasoline cannot be relaxed in the States which are now suffering in a degree greater than other States, that some consideration might possibly be given to reimbursing the States in which gasoline rationing went into effect a year earlier than in other States so as to help make up for this loss in revenue which weighs heavily against some States and less heavily against others.
If neither of these plans are availing, then we in Georgia must either
determine to drastically raise taxes or else to close down our Schools and other necessary State functions. I would not have any member of the Assembly or any person in this State to think that the statement of facts herein made are intended to in any way reflect upon the administrative program of our Washington authorities but we must let the people know here in Georgia what they are to expect. We cannot pay the school teachers; we cannot carry on the State Government with no money.
Not only must we manage to carry on the current State operations on less money than we have ever had but we must also manage somehow to try to pay off the State debt which on January 12, 1943 amounted to $35,981,630.38. We are making some progress in reducing the State debt and on March 25th it is our plan to pay $2,650,000.00 to the counties which represents an outstanding debt evidenced by certificates of indebtedness. Approximately $2,000,000.00 in State bonded indebtedness is due June 30, 1944, and I am ambitious to pay off this part of our outstanding indebtedness which has been in effect for more than one hundred years. We have reduced highway expenses and cancelled out outstanding contracts which will ultimately reduce this indebtedness. But even with these economies and payments, we have a rocky and rough road ahead.