STANLEY, Commissioner.
The case tests the validity and strength of the foundation of a proposed issue of bonds of the Commonwealth of Kentucky in the aggregate of $100,000,000, the proceeds of which are to be used to match funds that may be allocated to Kentucky for highway construction by the national government. The proposition was submitted to the voters at the November, 19S6, election and resulted in 511,656 votes being cast in favor and 85,635 votes cast against it. The circuit court adjudged the Act constitutional, and the proceedings thereunder proper. The court construed the Act and the resolution of the State Property and Buildings Commission (KRS 56.450) which more particularly prescribes the terms of the bonds and the marketing of them.
The case is before this court on an appeal and a cross-appeal. Twenty-three issues as to validity and construction of the Act pleaded were disposed of below. It may be said that in general outline the attack is upon (1) the Act as a whole, and (2) certain provisions therein. It is then argued that if only part of the Act is invalid, the entire project must fail since the people voted to incur the debt according to all the provisions of the Act and not just part of them. Questions concerning the construction of the Act and the validity of certain parts of the resolution of the State Property and Buildings Commission putting it into effect are also submitted.
At the threshold we deem it appropriate to make some preliminary observations. A challenge of the sufficiency of a law under constitutional provisions is not a technical objection to be treated lightly by the courts. Indeed, it is the sworn duty of the court to enforce provisions of the Constitution irrespective of the consequences. But one of the most firmly established principles of constitutional law, and an oft-repeated mandate of the courts, is that the wisdom or expediency of enactments of the Legislature is not for the courts to pass upon. This may be said to have special pertinency in matters of fiscal policy and authority to levy taxes and to appropriate the revenue. Nor are we concerned with the question of whether this project is based upon sound or unsound economic theories or is the best means to achieve the desired results. That is not within the scope of judicial inquiry. So, the wisdom of imposing the debt of one hundred million dollars and freezing all or as much as may be required of the highway taxes and revenue for the next thirty years is of no concern whatever to the court. All this was within the legislative responsibility and its power provided it was not restricted by the Constitution.
The project is based upon § 50 of the Kentucky Constitution. It prohibits the General Assembly from authorizing a debt to be contracted on behalf of the Commonwealth (with certain exceptions stated in § 49 and an obsolete provision in § 50) “unless provision be made therein to levy and collect an annual tax sufficient to pay the interest stipulated, and to discharge the debt within thirty years; nor shall such act take effect until it shall have been submitted to the people at a general election, and shall have received a majority of all the votes cast for and against it.” The General Assembly at its Second Extraordinary Session, which convened March 9, 1956, passed an act, Chapter 3, authorizing the execution, sale and delivery of one hundred million dollars ($100,000,000) principal amount of Commonwealth of Kentucky bonds, the proceeds from the sale of which will be used to match federal funds for the construction of highways, bridges [346]*346and tunnels in the Commonwealth of Kentucky, and providing for the submission thereof to the voters at the general election to be held on November 6, 1956. The Act is now published as § 171.580 et seq. of the Kentucky Revised Statutes.
We abridge general provisions of the Act which are not the object of special attack and state more fully the provisions upon which the challenges are based.
Section 1 declares that, subject to the provisions of §§ 49 and 50 of the Constitution, “there is hereby contracted on behalf of the Commonwealth”, as a direct obligation “a debt * * * of one hundred million dollars ($100,000,000)” for the purposes stated.
Section 2 provides that coupon bonds shall be issued in a described manner and form. It further declares, “All of said bonds shall bear interest at such rate, not exceeding three per cent per annum, as said Commission shall determine at the time of such issue. All of said bonds shall bear date of January 1, 1957.”
Section 3 requires that the bonds bear serial numbers and “shall mature on such dates, with such provisions as to prior redemption including premiums therefor, as may be determined by the State Property and Buildings Commission, providing that all of such bonds shall mature within thirty years from January 1, 1957.”
Section 4, the heart of the Act, is heavily assailed. It is quoted in full.
“Section 4. The bonds herein provided for shall be direct obligations of the Commonwealth of Kentucky, and the full faith and credit of the Commonwealth hereby is pledged for the payment of said bonds and the interest thereon. In order to provide for the payment of the principal of all of said bonds at their maturity and the interest thereon annually as same shall accrue, there shall be levied and collected in each of the thirty years from January 1, 1957, to January 1, 1987, taxes for the benefit of the State Road Fund in the form of license, excise taxes and fees relating to registration, operation and use of vehicles on public highways and excise taxes, use and license taxes relating to gasoline and other motor fuels used upon the public highways in Kentucky at rates not less than the rates now imposed by law or so adjusted as to produce for the Road Fund not less than the amount now derived from all of such taxes. All funds derived from such taxes hereby are appropriated to the extent necessary for the payment of the principal and interest on said bonds. From the funds derived from said taxes in each year, beginning January 1, 1957,. there shall be set aside and held inviolable for that purpose, a fund sufficient to pay the principal and interest on said bonds in each year as and when due until all of said bonds and the interest thereon shall have been paid in full. In each year, after setting aside the funds hereinabove provided, the-remainder of the funds derived from such taxes may be expended and used for the cost of administration, statutory refunds and adjustment, payment of highway obligations, cost of construction, reconstruction, right of ways,, maintenance and repair of public highways, tunnels and bridges and the expense of enforcing state traffic and' motor vehicle laws, provided that all the funds collected under KRS Chapter 138 and required by KRS 138.220, 138.565(3) and 138.660(3) to be set aside by the Department of Highways for the construction, reconstruction and maintenance of rural and secondary roads shall be first set aside and used for such purposes.”
Section 5 permits the sale of bonds at different times “in units of not less than five million dollars principal amount as and when the money to be derived from the issuance and sale of said bonds may be needed. The State Property and Build[347]*347ings Commission shall determine the time when and the principal amount of said ■bonds that shall be advertised and sold.”
Section 6 prescribes the manner and time for advertising a proposed sale of bonds ■and provides that, “None of said bonds ■shall be sold at less than par and accrued interest, and each advertisement for bids shall so state. Said Bonds shall be sold to the highest and best bidder. Said State Property and Buildings Commission shall have the right to reject any and all bids. Any premium and accrued interest received shall be deposited in the sinking fund provided by this Act1 for the payment of said bonds and interest thereon.”
Section 7 directs that the Commission ■“shall specify such terms for the bonds that are not inconsistent with the provisions of this Act.”
Section 8 authorizes the Commission to invest the sinking fund1 in bonds of the United States or to purchase bonds authorized by this Act or to deposit the amounts in a Kentucky bank upon adequate security.
Section 9 relates to the holding and investment of the proceeds of the sale of the bonds to be issued under authority of the Act and provides that the same “shall be used solely and only by the Department of Highways of the Commonwealth of Kentucky to match federal funds allocated to Kentucky for the construction and reconstruction of highways, tunnels and bridges within the Commonwealth of Kentucky.”
Section 10 directs the submission to the people at the general election of 1956 and the notice thereof. It prescribes the form of the question to be placed on the ballot shall be: "Are you in favor of the Act of the General Assembly known as Senate Bill No. 3, enacted by the Second Extraordinary Session of the General Assembly of 1956, authorizing the Commonwealth to issue and sell bonds of the principal amount not exceeding one hundred million dollars ($100,000,000), to provide funds to match federal aid in the construction and reconstruction of highways, bridges and tunnels in Kentucky?” The section contains provisions that if the majority of the votes cast on the question are in favor of this Act, “then all provisions of this Act other than those contained in this section, shall become operative on and including the first day of January, 1957.”
Section 11 defines “year” as used in the Act.
Section 12 reads: “All acts and laws and parts of acts and laws in conflict herewith, to the extent of such conflict, hereby are repealed.”
I.
The most troublesome question is whether provision has been made for “an annual tax” as is required by the Constitution.
Section 50 of the Constitution, quoted above, declares that no contract shall be made or debt incurred by the State “unless provision be made” in the Act of the General Assembly “to levy and collect an annual tax sufficient” to pay interest upon and discharge the debt within thirty years. Sections 1 and 4 of this Act very specifically declare that the proposed contract and bonds shall be “direct obligations of the Commonwealth of Kentucky” and pledge “the full faith and credit of the Commonwealth” for the payment of the debt. But the provision for paying the debt is confined to “license, excise taxes and fees” arising from the sale and use of motor vehicles, gasoline and other motor fuels. It provides that currently and in the future these taxes and fees shall be “first set aside and used for” that purpose. Are these special taxes and fees such a tax as is contemplated by the Constitution? It may be observed in passing that this section of the Constitution is the same as § 36, Art. 2, of the previous Constitution of 1850. See McDonald v. City of Lexington, 253 Ky. 585, 69 S.W.2d 1065. Of course, motor [348]*348vehicles and such taxes here made applicable to the payment of the debt were unknown when the Constitution was adopted. These taxes constitute a class separate and distinct from tangible ad valorem property taxes. They are indirect and specific taxes. See Foster & Creighton Co. v. Graham, 154 Tenn. 412, 285 S.W. 570, 47 A.L.R. 971, 975. None of them is regarded as or is in fact an “annual tax.” That term is ordinarily understood to mean a direct ad valorem tax. See 43 Am.Jur., Taxation, §§ 25, 26, 34, 83, 1261. “ ‘Annual tax’ means one that is levied each year.” People ex rel. Ogg v. Central Ill. Public Service Co., 328 Ill. 440, 159 N.E. 797, 798. Though the registration and licenses may be collected annually, the motor fuel and sale excises are daily taxes,
There are two decisions of other courts in point. In both of them the acts of the legislatures providing for the issuance of the bonds were declared to be unconstitutional because the taxes which they provided for their payment were not the kind of taxes which the respective constitutions prescribed.
One of those cases is State ex rel. Fletcher v. Executive Council of State, 207 Iowa 923, 223 N.W. 737. Section 5, art. 7 of the Iowa Constitution, I.C.A. is the same as our § 50 except for the use of the word “direct.” The language is, “and such law shall impose and provide for the collection of a direct annual tax, sufficient to pay” the debt. A road bond issue of $100,000,000 had been voted. In addition to what the court called a “purported provision” for a direct tax for the payment of the bonds, the act provided for the budgeting of primary road funds in such way that the bonds should in fact be paid out of such funds rather than by means of a direct tax. This road fund came from gasoline taxes, motor vehicle licenses, etc. which the court held to be indirect taxes. The act pledged these funds as irrevocable so long as any bond was outstanding, and declared that no legislature could in the future repeal those taxes. The court held this was bad because no legislature can guarantee the span of life of its legislation beyond the period of the biennium. This court is in accord. Billeter & Wiley v. State Highway Commission, 203 Ky. 15, 261 S.W. 855. “One General Assembly” the Iowa court said, “may not lay its mandate upon a future one. Only the Constitution can do that.” [207 Iowa 923, 223 N.W. 740.] It was noted that “In the absence of any constitutional provision to such effect, no General Assembly has power to render its enactment irrevocable and unrepealable by a future General Assembly.” The court observed that had a direct tax been levied as provided in the Constitution, future legislatures would be bound because the Constitution authorized it. The court therefore held that the irrevocable pledge of the highway taxes was wholly ineffective and void. Section 12 of the Act purported to levy a direct tax, but it was in fact merely qualified or alternative or substitutional. After analyzing the section, the court wrote:
“The net result of section 12, like that of sections 13 and 15, is that it pledges the license and gasoline taxes to a primary liability for the payment of the debt. This is a purported substitution of these indirect taxes for the direct tax. Thereby the section becomes doubly invalid, because the Legislature had power neither to pledge nor to substitute an indirect tax for a direct one.”
The other case is State ex rel. Capitol Addition Bldg. Comm. v. Connelly, 39 N.M. 312, 46 P.2d 1097, 100 A.L.R. 878. The legislature of New Mexico passed an act authorizing the construction of an addition to the capítol for the use of the judiciary and the issuance and sale of debenture bonds not to exceed $175,000 and appropriated that sum for the purpose, Laws 1934, Sp.Sess. 0.14. A sinking fund was to be raised by imposing a fee of $2.50 upon every civil action filed in the district courts. The act declared the bonds to be irrevocable contracts between the state and the holders of the bonds and that the tax on the [349]*349filing of the suits should not be reduced so long as any of the bonds were outstanding and unpaid. The court held that the bonds were payable only from the special fund and did not constitute a general obligation or debt of the state within the purview of the Constitution, particularly § 8 of Art. 9 dealing with the debt contracting power of the state. That section required that the law authorizing such a debt should provide “for an annual tax levy sufficient to pay the interest and to provide a sinking fund to pay the principal of such debt within fifty years from the time of the contracting thereof.” The reason for the conclusion of the court was that the term “annual tax” has reference not to an excise tax but to a tax upon property which recurs periodically and is based upon ownership of wealth as a measure of ability to pay and that the tax on filing suits was not “an annual tax.”
We turn to our own cases.
Crick v. Rash, 190 Ky. 820, 229 S.W. 63, resembles the instant case in that the obligations assumed by the state were to be paid out of special funds produced by county bond issues. Under a system of road building provided by the Legislature by an Act of 1920, c. 17 counties were authorized to create bonded debts and lend or advance the proceeds to the state for the construction of primary roads in such counties. The State Highway Commission would then issue certificates covering the loan or advancement to be paid to the county when the road project was completed, whether out of the special fund or not. This court held that the debt evidenced by the certificates was valid only to the extent that the Department had on hand or available during the year sufficient funds from sources already provided for which were unappropriated or not contracted against to meet the aggregate of all outstanding indebtedness, and held that any debts thereafter created were within the limitations of §§ 49 and 50 of the Constitution and to that extent were void. In short, the opinion holds that it was of no consequence that there would be future resources from special funds, because they could not be constitutionally anticipated.
In 1924 the Legislature (c. 122) provided for the issuance of $75,000,000 of bonds. Three-fourths of the proceeds were to be used for highway construction. The other fourth was to be used to pay a floating debt of the state and the balance divided among several state institutions. Before the proposition was submitted at an election, the validity of the act and the proposed bonds was challenged. The challenge rested upon only three grounds, (1) the title and act covered a multiplicity of subjects and undertook to amend other statutes by reference only, (2) the act did not itself levy a tax for the payment of the bonds, and (3) there was an unlawful delegation of power to various departments and boards.
A quotation from the act in the opinion shows there were appropriated and set aside as inviolable all funds received from (a) automobile licenses, (b) gasoline tax, and (c) a fractional part of “direct ad valorem tax of the Revenue Act of 1924 for the construction, reconstruction, maintenance and repair of roads and highways, and for the payment of the interest on and for the creation of a sinking fund for the liquidation of State bonds issued for roads and other purposes.”
The court did not consider the character of the taxes. We held the grounds upon which the contention of unconstitutionality of the act rested were not sustainable and directed a judgment validating the act. Allen v. Cromwell, 203 Ky. 836, 263 S.W. 356.2
In the consideration of the formidable and vital question concerning the meaning and comprehension of “annual tax” as used in § 50 of the Constitution in relation to the case at bar, we, of course, recognize the underlying principle that [350]*350there is a presumption of constitutional validity of a legislative act and the universal rule that a liberal construction is given to constitutional limitations, reasonable doubts being resolved in favor of validity. This judicial position of saving legislation if possible is rooted in the doctrine that a state constitution is not a grant of power but is a limitation on the power of the Legislature and that that department of government possesses and may exercise within constitutional limits all legislative powers as it sees fit. It may enact any law not expressly or impliedly prohibited by the Constitutions of the state or the nation. McCreary v. Fields, 148 Ky. 730, 147 S.W. 901.
Allen v. Cromwell, supra, tacitly approved the pledge of motor vehicle licenses and fees, although it was accompanied by the commitment of an annual ad valorem tax. Cognizance must be taken of the fact that the Constitution confers on the General Assembly authority to provide for the imposition of license fees and a “special or excise” tax. Sec. 181. More influential is an amendment adopted in 1944 which recognizes these taxes “relating to gasoline and other motor fuels” and requires that money derived therefrom shall be expended only for the construction and maintenance of public roads and the “payment of highway obligations.” Sec. 230. Thus, such taxes have become stabilized; therefore, are within the meaning of “an annual tax.”
In all the circumstances, we reach the conclusion that the pledge and commitment of the Act is to provide a tax in each of the thirty years as may be deemed annually sufficient to pay annual and other timely requirements of the bond issue, and that this is a substantial compliance with § 50 of the Constitution.
II.
It is argued that the vast amount to be paid as interest has the effect of making the indebtedness greater than $100,000,-000. There is some authority to sustain the contention but the weight of the authority is that interest to become due in the future is not considered an indebtedness within the debt limitations. 43 Am.Jur., Public Securities and Obligations, § 301; 38 Am. Jur., Municipal Corporations, § 439. The Supreme Court held in Sutliff v. Lake County, 147 U.S. 230, 13 S.Ct. 318, 37 L.Ed. 145, that interest is not regarded as part of a bonded indebtedness of a municipality for the purpose of determining whether such indebtedness is within the constitutional limit. This Act clearly reveals that the sum of $100,000,000 is the principal sum and that interest that will accrue and be paid is additional thereto.
III.
Section 50 of the Constitution prescribes that provision be made in the act “to levy and collect an annual tax” sufficient to pay interest on and discharge the debt within thirty years. It does not require that the particular initiating act shall itself make the levy. Allen v. Cromwell, supra, 203 Ky. 836, 263 S.W. 356.
The appellant argues that § 4 of the Act does not comply with the mandatory requirement of the Constitution that provision be made for a tax, but if it does, then the provision is void because the bill originated in the Senate, and § 47 of the Constitution requires that all bills raising revenue must originate in the House of Representatives.
We do not think the point is sustainable in either respect. Provision is built into the Act. We construe it as appropriating revenues already being raised and committing the State to continue such taxes or so much as may be necessary to pay the bonds and interest. The Act does not purport to raise revenue or to increase taxes. To “raise revenue” means to levy a tax as a means of collecting revenue. Ballentine’s Law Dictionary, p.- 1084. If additional taxes of this character should in the future be imposed for this or other purposes, such a bill would, [351]*351of course, be one for raising revenue; but we do not regard freezing or stabilizing present revenue as doing so.
IV.
Appellant submits that the Act unconstitutionally diverts funds from purposes for which the taxes have been imposed. Section 180 of the Constitution declares that “no tax levied and collected for one purpose shall ever be devoted to another purpose.” Section 230 provides that no money derived from excise and license taxation and fees relating to gasoline and other motor fuels, vehicles, their registration and operation, etc. shall be expended for other than specified highway purposes. It was held in Keck v. Manning, 313 Ky. 433, 231 S.W.2d 604, that the purpose of the gasoline antidiversion amendment to the Constitution, § 230, was not to curtail the road program but to make secure the funds with which to continue it, so it was held that expenditures by the Highway Department for advertisement, etc. were not a diversion. The purposes and objects for which the proceeds of the bonds to be issued under the present Act are to be used are clearly within the terms of § 230 of the Constitution. The costs of preparing the bonds, advertising and marketing them are essential parts of the whole. Crick v. Rash, 190 Ky. 820, 229 S.W. 63.
V.
It is contended that the form of the question appearing on the ballot did not give sufficient and proper notice to the electorate of what they were voting upon. The question (see § 10 of the Act, outlined above) asked whether the voter was in favor of the Act authorizing the “Commonwealth to issue and sell bonds” to provide funds to match federal aid in the construction, etc. of highways, etc. This did not give notice of the character of the bonds as general obligations of the State (as distinguished from revenue bonds, which have become a popular method of public financing) to be paid for by the hypothecation of all or a substantial part of the motor vehicle taxes and fees for a period of thirty years; nor did the question indicate that such allocation will have precedence over all other money available for construction and maintenance of highways and rural and secondary roads.
There is no provision in § 50 of the Constitution in regard to notice of the proposed referendum. Section 178 of the Constitution does provide that all laws authorizing the incurrence of debt by the State and its political subdivisions must specify therein the purpose for which the money is to he used. That purpose was not only specified in the Act but in a general way was contained in the question placed on the ballots in accordance with the Act. The form of the question and the character of the notice to the public were within the legislative power to prescribe. See Allen v. Cromwell, 203 Ky. 836, 263 S.W. 356; King v. Katterjohn, 193 Ky. 359, 236 S.W. 250; Burke v. City of Louisville, Ky., 275 S.W.2d 899. If it was not sufficient, the fault was in the Legislature.
The Act required its publication “once a week for four consecutive weeks next preceding the week of the general election * * * in at least three newspapers of general circulation.” It was published in full in nine newspapers under a large heading, “Notice of Election.”
We may well agree with counsel that probably the number of voters who read the Act were few and not many who did, understood its entire significance and import. Doubtless, many of the people could hear nothing but the siren promise of nine hundred million dollars of “free” federal money.3 However, it must be assumed that before voting the people informed themselves of the liabilities they will incur as [352]*352well as the benefits they will receive under the proposition submitted to them.
We think the word “bonds” in the question on the ballot was not misleading. The word has a well-known dictionary meaning when used as the evidence of a public debt. The term “revenue bonds” is a descriptive qualification indicating that the instruments are payable solely from a revenue producing public project. The word “bonds” needed no definition or indication that they were not revenue bonds or any other special kind.
VI.
This disposes of the substantial questions of unconstitutionality which have been urged on the appeal. So, we do not reach the point that if any part of the Act should be declared invalid, the entire Act is rendered ineffective because the deleted parts may have operated as an inducement to an affirmative vote. See State ex rel. Fletcher v. Executive Council of State, supra, 207 Iowa 923, 223 N.W. 737, 742, so holding.
The other questions concern the interpretation or construction of the terms of the Act and of the resolution of the administrative commission putting them into effect.
VII.
What is the meaning and extent of the provision of § 4, “The bonds herein provided for shall be direct obligations of the Commonwealth of Kentucky and the full faith and credit of the Commonwealth hereby is pledged for the payment of said bonds and the interest thereon?” The circuit court adjudged that the bonds will be direct and general obligation bonds of the Commonwealth, and the full faith and credit of the Commonwealth will be pledged for the payment of such bonds and interest.
There are two views as to the proper response.
One is that the “direct obligations” are as described and limited by the Act and that the commitment of full faith and credit of the Commonwealth is confined to the sources of revenue described therein, that is, a pledge to continue those taxes at the present rate, or at rates “so adjusted” by increasing them so as to produce funds sufficient to meet the obligations, and to do nothing more.
The second view is that in case there should ever be a deficiency by reason of the insufficiency of the designated resources, the Commonwealth, without qualification or limitation, must levy ad valorem taxes or taxes of some other kind or increase the present rates sufficiently to meet the demands of the debt.
The majority of' the members of the court accept the second view and concur in the judgment of the circuit court. The others believe the first view is sustained by reason of § 50 of the Constitution requiring that no debt may be contracted without provision being made therein to levy and collect a sufficient amount of the taxes described, and there was only a qualified provision. This view is supported by State v. Citrus County, 116 Fla. 676, 157 So. 4, 97 A.L.R. 431.
VIII.
Is any portion of the gasoline and other taxes excluded from the appropriation of the pledge for the payment of the bonds and interest?
KRS 138.220 imposes an excise tax of seven cents per gallon on all gasoline received in this state4 and directs the Department of Highways to set aside two-sevenths of such amounts received “for the construction, reconstruction and maintenance of rural and secondary roads and for no other purpose.” KRS 138.565(1) imposes a seven cents excise tax on “Special Fuel” as therein defined and subsection (2) imposes an additional seven cenjis for “heavy equipment special fuel user.” ¿Lib-section (4) provides that two-sevenths of [353]*353the amounts received from the taxes paid under subsection (1) shall likewise be set aside for rural and secondary roads and for no other purpose. KRS 138.660 imposes a tax of seven cents per gallon on gasoline used in operation of motor carriers on the public highways of the State and a surtax of two cents per gallon on every “heavy equipment motor carrier.” Two-sevenths of the receipts from these taxes are required also to be set aside for rural and secondary highways “and for no other purpose.”
It will be noted that § 4 of the bond issue Act refers to these several sections of the Statutes. The question is whether all of such funds thereby set aside for rural and secondary roads are excluded from the appropriation and pledge of funds for the payment of the bonds.
Section 4 of the Act declares, “All funds derived from such taxes [i. e. taxes for the benefit of the State Road Fund] hereby are appropriated to the extent necessary for the payment of the principal and interest on said bonds.” Then follows a sentence declaring that from those funds in each year “there shall be set aside and held inviolable for that purpose, a fund sufficient to pay the principal and interest on said bonds” etc. Then follows this sentence, “In each year, after setting aside the funds hereinabove provided, the remainder of the funds derived from such taxes may be expended and used for the cost of administration, statutory refunds and adjustment, payment of highway obligations, costs of construction, reconstruction, right of ways, maintenance and repair of public highways, tunnels and bridges and the expense of enforcing state traffic and motor vehicle laws, provided that all the funds collected under KRS Chapter 138 and required by KRS 138.220, 138.565(3) and 138.660(3) to be set aside by the Department of Highways for the construction, reconstruction and maintenance of rural and secondary roads shall be first set aside and used for such purposes.” (Our italics.)
The circuit court held all the two-sevenths part of the gasoline taxes imposed by those sections of the Statutes are excluded from the appropriation and pledge of revenue for the payment of the bonds. We think this is error. The proviso relating to setting aside the designated taxes follows a comma, thereby making the phrase a continuing and integral part of the one sentence which disposes of the “remainder” oi the funds.
The general rule of statutory construction in relation to a proviso is thus stated in 50 Am.Jur., Statutes, § 438, as follows:
“The natural and appropriate office of a proviso is to modify the operation of that part of the statute immediately preceding the proviso, or to restrain or qualify the generality of the language that it follows. Indeed, the presumption is that a proviso in a statute refers only to the provision to which it is attached, and, as a general rule, a proviso is deemed to apply only to the immediately preceding clause or provision. It should be confined to what precedes, unless it is clear that it was intended to apply to subsequent matter.”
In Newport Benevolent Burial Association v. Clay, 170 Ky. 633, 186 S.W, 658, 663, in an amendatory act consisting of two sections, Acts 1908, c. 72, there was a separate paragraph at the end of § 2 beginning, “Provided, however” that certain provisions of the act should not apply to certain corporations, etc. The question was presented to this court whether this proviso paragraph applied only to § 2 or applied to all sections of the act. The court ruled that the effect of the proviso was only to limit the requirements of § 2. In reaching the conclusion we said: “The common and accepted doctrine is that the operation of a proviso is usually confined to the clause or provision immediately preceding it, and it will be so applied, unless, in effecting the legislative intent, it is necessary to apply it to the other provisions of the act or to the [354]*354entire act.” See also Muenninghoff v. Bartholomew, 269 Ky. 36, 106 S.W.2d 97.
Making such an application to the present Act, we construe it as meaning that the proceeds of all such taxes are to used for the payment of the bonded debt so far as may be necessary, and that in distributing the “remainder,” priority or preference must be given to the two-sevenths of the taxes described for use on the rural and secondary roads of the State.
The appellant submits that the taxes described in KRS 47.020 are likewise appropriated for the payment of the bonds, although that section is not expressly referred to in the Act, because of § 12, the repealing provision. KRS 47.020 (the original of which has been in the Statutes for a long time) provides that “one-half of all revenue raised by the tax imposed by subsections (3) to (8) of KRS 186.050 shall be evenly distributed among all the counties, for the county road funds.” These sections relate to registration fees of trucks and buses. We think no part of the one-half of these fees which is required to be distributed to the counties is committed for payment of the bonds because that part of the receipts never gets into the “State Road Fund,” which is the resource specified in the Act. We approve the circuit court’s ruling excluding this county road revenue.
IX.
It is noted that the Act, § 2, provides “All of said bonds shall bear interest at such rate, not exceeding three percent per annum, as said Commission shall determine at tire time of such issue.” The State Property and Buildings Commission adopted a resolution setting forth a schedule or plan to issue these bonds in specified units or blocks with specified maturity dates. The schedule shows that bonds maturing in the period 1958-1967 would bear 4% interest coupons; The next block, maturing during 1968-1973, would bear 2.60%; the next block maturing during 1974-1980, would bear 2.75%; and the final block, maturing 1981-1987, would bear 2.80%. Under this plan the aggregate interest payable would be $47,451,000, or an average rate of 2.8758181% per annum, while the aggregate interest at the uniform rate of 3% on each bond would be $49,500,000. Whether or not this plan would work out may be problematical, but the stubborn fact is the Act itself is specific in providing that “All of said bonds” shall bear interest “not exceeding three percent per annum.”
The Attorney General submits various dictionary definitions of “all” and argues, with some degree of plausibility, that the phrase, “All of said bonds,” means “the whole of said bonds,” and thereby the Act provides that the bonds collectively should not bear more than three per cent interest, permitting an average rate of that per cent or less. We think this strains the meaning of “all” in this relationship. We believe the Legislature meant “each and every” bond and that it intended that none of the bonds should bear interest in excess of three per cent. It is noted that § 2 of the Act likewise provides that “All of said bonds shall bear date of January 1, 1957.”5 It further says, “All of said bonds and the interest thereon shall be exempt” from taxation. These provisions negate the view that the provision, “All of said bonds shall bear interest” not to exceed three per cent means that some may bear more than that rate if some bear less. The circuit court construed the Act to mean that no bond "may bear interest at a rate greater than three per cent (3%) per annum.” We agree. Golden Gate Bridge and Highway District v. Filmer, 217 Cal. 754, 21 P.2d 112, 91 A.L.R. 1, is in accord.
[355]*355X.
Section 3 of the Act provides that the bonds “shall mature on such dates, with such provisions as to prior redemption including premiums therefor, as may be determined by the State Property and Buildings Commission” etc. The resolution of the Commission follows the language of the Act in general but leaves open the determination of the dates of maturity and provisions for prior redemption, including premiums that might be paid in consideration thereof to be fixed by supplemental resolutions before the respective blocks of bonds shall be issued and sold.6 The circuit court held invalid the provision of the resolution for the payment of premiums upon redemption'of the bonds where the premiums and interest exceed three per cent per annum.
Section 3 of the Act plainly authorizes the redemption before maturity of any bonds upon the payment of a premium. We recognize this practice as being in conformity with good financial usage and see no legal objection to the provision. However, the amount and method of payment of redemption premiums must conform to sound banking and fiscal practices existing at the time the bonds are issued and sold.
XI.
The judgment declares that before setting aside funds to pay the bonds and interest, prior contractual obligations must be adequately provided for by first setting aside (a) all funds required by KRS Chapter 177 and a certain trust agreement for the cost of maintaining, repairing and operating the turnpike between Louisville and Elizabethtown, the cost of construction having been derived from revenue bonds; (b) all funds required by KRS Chapter 180 and certain trust indentures securing bridge revenue bonds now outstanding to pay the cost of operating and maintaining the bridges; and (c) all sums required to be paid under contracts of the Department of Highways which are in existence on the respective dates any bonds are issued pursuant to this Act. But, the judgment declared, “Title 23 of the United States Code and the acceptance of federal aid by the Commonwealth of Kentucky thereunder does not create any encumbrance or claim upon or against the funds derived from any of the aforesaid taxes.” 7
This part of the judgment is clearly correct.
XII.
The conclusion of the whole matter is that the judgment should be affirmed except as it relates to the preference of funds for rural and secondary roads and premiums for redemption or pre-mature payment of the bonds.
The judgment is affirmed on direct and cross-appeals except it is reversed for modification to conform to Divisions VIII and X of this opinion.
MONTGOMERY, J., dissents.