Expenditures for highway activities rose significantly over the decade. However, revenues from liquid fuels taxes and motor license fees, and federal grant-in-aid funds, historically the principal source of highway funds at the state level, provide a diminishing proportion of the total funds required for highways. The use of borrowed funds has correspondingly increased. The state legislature now controls resource consumption for capital expenditures via an individual project approval mechanism. The historical trend toward more centralized control and direction of state highway functions continues with Pennsylvania's establishment of a Department of Transportation in July, 1970. (Modified author abstract).