There will be an enormous exchange of commodities between the two valleys when the road is constructed. It will make a three hour auto trip between Ashland and Klamath Falls, which now takes 8½ hours by train via Weed, California. The location will be resumed in the spring, and continued to Klamath Falls. Surveys have been in charge of Mr. J. H. Scott, locating engineer. JEFFERSON COUNTY Jefferson is the only county in Eastern Oregon that has not applied for State aid in some form. This County has been included in the State's general Post Road scheme and doubtless will receive early attention from the State Highway Commission. The State Highway Commission has ordered a reconnaissance survey made from Kingsley and Tygh Valley in Wasco County south through the Warm Springs Indian Reservation into Jefferson County along the west side of the Deschutes River. This investigation will be made during the coming spring. The County is traversed by The Dalles-California Highway which will be a very important road. The Antelope-Mitchell Highway also passes through the northeast corner of the County. JOSEPHINE COUNTY During the two year period covered by this report, a very marked improvement has been made in the Pacific Highway across Josephine County. During this time 8.2 miles, or more than one-quarter of the total mileage of this highway in the County, were completed on standard grades and alignment, eliminating some of the heaviest and most dangerous grades between Portland and the California Line. The work done by the State consisted of the grading of a 4.9 mile section between Wolf Creek and Grave Creek in the northern part of the County, and the grading of a one mile section, known as the Locust Hill Section, about three miles south of Grants Pass. The work done by the County consisted of 2.3 miles of grading between Locust Hill and the Jackson County Line. This County work was contracted under State Highway Department specifications and was engineered by the Department engineers. In addition to this construction work, location surveys were made over 23.6 miles of the Pacific Highway, completing the location across the County. These surveys were made in three sections: One from Wolf Creek to Grave Creek; one from Grants Pass to Grave Creek; and one from Wolf Creek to Stage Road Pass. The total amount of money expended by the State in Josephine County during the fiscal years 1917 and 1918 was $77,998.14, and the amount expended by Josephine County under State supervision was approximately $8,500.00. Some considerable amount of work was also done by the County in grading just south of Grants Pass. While this work was not under State supervision, it was on the State survey and is standard as regards grade, alignment, cross-section, etc. [Illustration: ON THE WOLF CREEK-GRAVE CREEK SECTION OF THE PACIFIC HIGHWAY IN JOSEPHINE COUNTY. GRADED IN 1918] Grading--Wolf Creek to Grave Creek