Evening star. [volume] (Washington, D.C.) 1854-1972, 1916-02-17
CUT IN THE RATES
FOR TAXI SERVICE
Terminal Company Voluntarily
Lops $4,000 From Its
Yearly Revenues.
SCHEDULE OF CHARGES
GETS COMMISSIONS O. K.
Ten Per Cent Profit Figured, Not
Codnting Commissions Paid
to Hotels.


Company They have received the ap-
proval of the public utilities commits
sion and will become operative April l.
This is the second instance of vol
untary reduction of rates being made
by a local public utility on the basis OF
the valuation of its property as estab-
lished by the public utilities commits
sion. The first case of this character
was the recent reduction of certain
telephone rates, the property OF the
telephone company being the first to
be valued by the commission.
1t is estimated that the action of the
Terminal Taxicab Company will result
in reducing its gross revenues nearly
$4,000 year.
The company's present rates. one to
five passengers, are SO cents for the
first half mile and 10 cents for each
quarter of mile thereafter.
Schedule Of New Rates.
The new rates for metered service
will be: For one passenger, 80 cents
for the first half mile. and 10 cents
for each quarter mile thereafter, and
Of the second and third passengers.
and no additional charge for passen-
gers above three.
In accepting the new schedule. the
commission ruled that the payment by
taxicab companies of commissions to
hotels. clubs. etc. on business obtained
through such establishments is not q
proper operating expense in computing
net earnings for rate making purposes.
The value Of the property Of the
vol To~r - q h.
lished by the commission April 2, 1915.
is $225,00O. This value brought up to
date Is given at $276,500. The commis-
sion states that Of this amount $261 .244
public service business. and that rec
ords kept by the utility company In
question show that the new rates prob
ably will produce a return Of 10 per
cent on this amount.
Ten Per Cent Fair Return.
The commission has Informed the
company it is Of the opinion that 10
per cent Is a fair and reasonable rate
Of return for this class of business,
due to the fact that the taxicab busi
ness Is comparatively new, and its
future therefore not so certain as older
classes of public service, and due to the
further fact that the records show that
it is subject to wide variations in VOL
ume of business resulting from f1nan-
cial and other conditions.
According to figures made public by
the commission. the company's gross
the fiscal year ended September 30.
1915, amounted to $225,S42.14. 1t is
estimated that the new rates will pro-
duce a gross revenue of $216,300, or a
reduction in gross revenue Of 1-5
per cent.
Statement by Commission.
The commissions statement con-
tinues:
Figuring the commissions paid out
by the company as part of the
operating expenses, the companys re-
turn under the present rates tgross
revenue less operating expenses and
taxes) amounted to $16,667.19, a return
of 6.37 per cent on the fair value of
the company It is estimated that the
companys return under the new rates
will amount to $7.0o,000. a return of
|2Z per cent on the fair value Of the
Excluding commissions from operat-
ing expenses, the company's return
under the present rates amounted to
$36,s4530, a return of 14.1 per cent on
the fair value of the company 1t is
estimated that the company's return
under the new rates will amount to
$27 10000, a return of about 10 per
cent on the fair value of the company"
With the object of reducing rates. the
company, according to statements by
it's officers today. began last May to
keep traffic statistics. segregating the
number of trips and the revenues
therefrom, with one. two. three. four
and five passengers. respectively, per
trip.
Three Plans Proposed.
After testing different rates by the
statistics compiled. the company pro-
posed three plans to the commission.
The first plan Is the one that has been
accepted. The other two called for 80
cents for the first half mile and 10 cents
per each quarter Of a mile thereafter
for one passenger, with 20 cents addj-
tional per trip for each of the second,
third and fourth passengers, and the
same additional charge for each of the
second, third. fourth and fifth passen-
gers.
The company looked with most favor
on the scheme which the commission
has adopted. although the loss in reve-
stated, would have been less.
According to officials of the company,
the new rates are based on the theory
that the thing most desired in taxi
| service is a reduction in the cost Of the
| service Of one-passenger travelling
alone. While the loss in revenue un-
der the new rates. 1t Is stated, will be
approximately $4,000 a year, the COM
pany expects that the reduction will
stimulate additional business.
1t is understood that the Federal
NJ fs~o e.