Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1917-09-26
...,,nn.a from rare One

.,.o,v mowers which existing statutes would
~. 20 vest in City Councils or in the De-
.srtn,ent Of City Transit, or In the Public
ssrvjce Commission The provision for
suoh a board is Of doubtful legality and
,1srsI,, 20 lead to disputes and litigation, the
result OF whlch u 10 h'pO'S''ie " iOresell at
this time.
As the Smith lease now stands a num-
49, of its most important consequences
resuIt from the concurrent operation Of
sjdely separated paragraphs, whose rela-
,,ar 10 one another can be perceived only
ss,er expert study. Any such arrange
.,snt between the city of Philadelphia and
.ho p r. T. Company, should, and can be
embodied In an instrumept the full meaning
Ii M which can easily be gathered by an
ordinarily intelligent citizen.
Tho foregoing facts are not only clearly
established by the terms of the Smith lease
e,on, a practical viewpoint-as have dem.
anstrated in O pamphlet which have cir
eulated throughout the city--but they are
9lso the findings of Messrs. Charles L. Nc
keehan. Parker S. Williams, Thomas Rae
burn white, william A. Glasgow Jr., Hen.
~ g. Thompson, Jr., and owen j. Rob-
,rts leading members Of 1.-The Philadelphia
bar of the highest standing, who, acting in
public-spiritcd capacity without compen-
sation, have studied the Smith lease and
. rlven their opinion which sustains these
conclusions.
BENEFITS FOR STOCKHOLDERS
The Smith lease would also make avail
able to the stockholders of the p. Il. T. Com
many from time to time, additional funds
nyer and above half the profits and per
cent cumulative dividends on the stock
These additional payme7is would amount to
about $40 a share, This, the stockholders
yrould be assured approximately $50 share
FOR their stock, at the expense OF street
railway passengers and the p. n. T. Com
pany would also be relieved Of supplying the
Equipment for the city's high-speed lines
unless II could secure the money required
therefor on a per cent basis.
During my twenty years experience in
the management of a number OF electric
railway properties throughout the country,
one of my most important duties has been
10 negotiate and draft leases and operating
contracts. Therefore, L nave made very
complete and careful studies of such leases
and contracts and matters pertinent thereto.
Based upon this experience, and a most
careful ANALYSIS of the Smith lease which
7 have made ] wish to assure the citizens
of Philadelphia that the Smith lease would
tie up the city and impose upon 1t and upon
The street railway passengers financial bur-
dens and obligations Of a most seriously
onerous nature.
ANSWER TO LEWIS ACCUSATION
I regret to note that Doctor LOWS pub
fishes a statement this morning that pro-
uosed that the T.. II. T. Company snOuiu ne
maid about s45, ,OOO, 900 for the abolition of
the exchange tickets.
As this erroneous statement has been re-
ueated time and again recently by prOpO-
nents Of the Smith lease, and as II almost
tmpugns my integrity, must answer IT,
IN the afternoon Of March 20, 1914, at
n public meeting held In the l.. X. 7. Com
pany's office, which was attended by the
directors OF the p. r.. T. Con''."S, b..
Joint committee Of City Councils. and by
IsaIrr tnnh In
marty 10 an arrangement between the city
and the company which would have com
pensated the company TO the extent OF some
sac, 900, 900 for eliminating the Illegally dis
criminatOry exchange tickets.
went before the public and industriOusIy
attacked this proposition as unjust, and
defeated It,
The facts are available to any one who
win turn TO the newspaper files OF March
s6, 1914. and TO any one who VIII ask me
for IL copy OF a pamphlet which drafted
and which was then circulated throughout
the city.
The Taylor lease did provide that certain
payments heretofore made by the Philadei-
phIa Rapid Transit Company to the city
should, after the date OF the lease, be
cancelled. This reduction in hxed charge'
OF the unified system, however, would have
cOrrespondinEly increased the surplus tT
excess of the cOmpany's per cent diVl
dend, OF which surplus the company wa'
to have received only One-tenth and the
city nine-tenths.
The statement. therefore, by Doctor
Lewis, and in Director Twinings analysis
that I propose that the city should pay any
such sum as they mention for the abolition
Of exchange tickets is wholly without
foundation.
LEWIS PROMISES AMENDMENTS
Mr.. Lewis, legal transit advisor Of Mayor
Smith, admitted in a letter to Councils
Joint Finance and Street Railways Commit
in .nN-ief ~
Smith -Mitten lease are not clear. I1 orde
10 avoid any ambiguous interpretations Mr.
Lewis promised to submit to the committe'
amendments to the lease correcting som'
of the defects pointed out by former Transi
Director A. Merritt Taylor.
Mr. Lewis's letter was submitted in an
swer to the series of questions on the leas'
propounded by Mr.. Taylor at the public
hearing of Friday of last week. In hi
letter Mr.. Lewis took the position that th
majority of the eX-Dlrector's queries arr
based upon Interpretations
These Mr.. Lewis gives as follows:
First. That the proposed lease guaran-
tees a per cent cumulative dividend
Second. That the proposed lease re-
quires the city to purchase the property
of the Philadelphia Rapid Transit Com
pany.
Third. That the fund provided for in
Article XIII and designated an "oper-
ating Surplus Fund" is working capital
fund.
take this occasion to reiterate what
have publicly stated before your COM
mittee on several occasions, as follows:
First. That the proposed lease contains
no guarantee or assurance of any SPECIFIC
rate Of dividend to the Philadelphia Rapid
Transit Company. The city comedies the
fairness Of a per cent dividend, but goes
no further.
Second That the proposed contract
does not require the city to purchase the
property of the transit company.
Third That the oneratinR surplus fund