Evening star. [volume] (Washington, D.C.) 1854-1972, 1900-02-14
TELEPHONE HEARING
Continued from Second Pagel

Continued from Second Page)
| scribers in the District. The new company
already has 1867 contracts, and Of this
| number C2J subscribers have Bell phones.
In Detroit, city of 100000 inhabitants,
there are about 10000 telephone subscribers
against 1000 in this city.
Mr. Smith said the competing telephone
company in Detroit had sold out to the
Bell Company.
Mr. Webb explained that transaction NY
| saying that when the new company went
| there they. proposed rates of Si8 and $3G.
Then another company, some had said
| backed by the Bell people. offered to per-
| form the service for lower rates, and the
| new company was forced to accept these.
| They were ruin0us rates: 1t was Impossible
to give the service upon such terms, and
the newcomers were forced to sell out.
Il would not have this franchise at 81
and $780, said Mr.. Webb. "for the service
could not be given. We know that 1t can
| be given at SIS and S36- These rates nave
same company which had to sell out in De-
| troit went to New Orleans and worked at
| the siS and S36 rate.
/ No Question of Financial Ability.
Mr.. Webb said there was no question of
the financial ability of the nett company to
| carry out it's work. The entire issue of
| bonds would be underwritten at once. The
Baltimore company is now spending 81
100000 in that city. A central exchange, to
cost 1925 600. is being erected. with several
| other buildings. The poles of the electric
| railway companies will be utilized 10 ex-
| tend the lines to suburban towns
| Have you already provided your capital
to build the system here?" asked Mr..
| Mudd.
] Il will answer that question by making
| this proposition said Mr.. Webb. You
can put a provision in the franchise re-
| curing us to give bond Of 100000, to be
forfeited to the District # Columbia if the
plant is not completed and in opera ton
within fourteen months after the District
| Commissioners sign the plans"
[ Mr.. Webb read letters from the Interna-
| tional Trust Company, the Maryland Trust
| Company and the Guardian Trust Com
| pany testffying to the financial standing
| Of the Baltimore and Pittsburg companies.
Mr. Sidney Browne, engineer of the Pitts
| burg company. said he thought the Wash
| ington system could be completed within
fourteen months. In Pittsburg they had
] been working eight months, and within two
months there will be 1000 subscribers con-
nected
Mr.. Cowherd of the committee asked If
the company knew at what figures the tele
phones could be operated. Mr.. Webb said
they have figures from Detroit Business
telephones cannot be operated for less than
S4s.
At this point Mr.. Webb read a sta cement
showing that 80 per cent of the stock of
the local telephone company the Chesa-
peake and Potomac Company, is owned by
the Bell Telephone Company of Boston.
The net earnings of the parent company
last year were 81 1893 600, added to a Sur
plus previously acquired of So, $50, 600
There is where your 1925 rate comes in"
said Mr.. Webb. The money goes to the
Boston concern.
MIR. Hemphilrs Statement.
Mr.. Thomas W. Smith of the Telephone
Subscribers Association then introduced
Mr.. j. J. Hemphil to the committee.
Mr.. Hemphill said he counsel for the
Telephone Subscribers Association. formed
by the subscribers of the Chesapeake and
Potomac Company to enforce an act of
Congress of the last session fixing the rates
AT which all companies should do business
here. The company had refused to comply
with the act of Congress: had said 1t would
appeal to the courts or take out the phones
if the subscribers refused to pay the
higher rates.
We have taken a great deal of testi-
mony," said Mr. Hemphin. land are con-
WINGED that 80 is an ample rate for a bus
mess telephone and 1876 for residence"
Mr.. Hemphill told of the injunction which
had been brought in the courts and the de-
cision of the court that the act of Congress
was unconstitutional.
THE practical outcome Of this decision"
said Mr.. Hemphill. lis that the American
Bell Telephone Company can fix rates
which Congress cannot amend
Mr.. Hemphill said that the Chesapeake
and Potomac Company IS doing business in
Washington not under any franchise grant
the Commissioners to string wires, and be-
cause Congress has recognized its existence
by providing that overhead wires shall be
erected in a certain manner. Mr.. Hemphll
said that personally the subscribers asso-
citation had no interest in any particular
company. but the local company having re-
fused TO listen to Congress and having con-
WINGED the lower court that it cannot do
business heSe at the rates imposed by Con-
gress the subscribers want some company
which will do business at the lower rates
In ffAr
an amendment which would prohibit this
company from selling out to any other
company. They would not restrict them
from making connection with other ex-
changes, because the long distance system
is desired.
Mr.. Webb explained that there had al
ready been Incorporated S5.0O0.OOO COM
pany, which will own stock in the several
local corporations He would not want to
be prohibited from turning over the Wash
ington to the parent company.
What Subscribers Want.
Mr.. Hemphiii said the subscribers only
wanted restriction which will insure tele-
phones at lower rates. In addition 1t is
suggested that the company should be re-
quired to give bond to construct the plant
within a certain time.
Mr.. Norton of the committee wanted to
know If the new company would require
guests at the hotels to pay for using the
telephone.
Mr.. Webb replied in the negative. The
service would be unlimited
Mr.. V. Baldwin Johnson, explaining some
Of the intricacies of the present telephone
system in the District. said that as a wood
and coal dealer he has customer who
keeps n drug store and who has a pay
telephone. When the customer wants to
talk about wood and coal he drops a postal
card to Mr.. Johnson, who thereupon calls
up the druggist on his own phone. If the
druggist should desire to call up the coal
dealer 1t would cost him 10 cents.
Mr.. Hemphiil. continuing, said that at
$4S a great many persons will take tele-
phones, and he was satisfied that the new
company would accommodate great pro-
portion of people now denied privileges.
In Toronto the rates are about TIE same
as proposed in the pending bill. There are
between 5000 and 5000 subscribers the
service Is excellent and the company is
making money The highest CHI