Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1917-12-10

~ A '!Z p. \ n ~. (, ~ .'n nay have bssr
thus 4 bsccnss apparent, on the other
Transit Company. which, under ths
terms OF the 1907 contract, Is bound 10
maintain tho present rates of fare--un.
less they be changed with the consen,
Of the city--will be subjected to heavy
and unexpected Increases in its charges
and cost of operation resultant from
the war, which viii probably require
an increase In car fares, regardless OF
the effect of the city's transit develop
ment and before any part Of II is placed
IN operation, IL the present per cent
dividend Is to be maintained by that
| company.
Under the terms OF the proposed con-
tract the company would be definitely
assured of a cumulative per cent divi-
dend upon its stock, with the right to
Increase car fares TO any extent neces-
sary TO produce and pay that dividend
III the company can at any time sub
nit TO the public authorities facts and
figures which demonstrate that It is
entitled TO increased car fares. the pub
lie authorites-after investigation OF the
suoject-should determine what increase
the facts require and fully Justify, and
promptly allow the same.
For the city to enter into n contract
under present abnormal conditions
(Which are depicting the Z. r. r Com
pany's net income )--empowering that
company 20 Increase car fares to any
extent necessary to maintain its per
cent dividend. without investigation of
relevant facts by the public authorities
and without having the equities Of the
case tudicially determined, would be un-
justifiable.
COMPACT OF 1907
Under the 1907 contract, vast conces-
slons were made by the city TO the =. r.
T. Company in consideration Of its
agreement to maintain the present rate
of fare.
Only two factors could. therefore. JUS
3fy the city in releasing the company
from that commitment
First An expose of facts and figures
to competent public authorities
which would demonstrate that the pres-
ent rate of fare Is unjust, and what
rate of fare the equities of the situation
entitle the company to charge. Then It
would be the duty of the public authori-
ties to Immediately allow whatever in
crease in car fares they may find to be
Just.
Second. Municipal action in estab-
fishing subway and elevated railways in
co-operation with the L. r. T. Company
NOulu tllllllt lildN COMPANY W bl'l'Cllbll
against competitive losses and to rca-
sonable compensation for its co-opera-
ton.
The aforesaid second factor has been
removed tnr an indefinite period by rea-
son of the city's inability to build any
of its high-speed lines. except the Frank
ford elevated
1t has been conceded by the company
and by the city that the operation Of the
Frankford elevated by the cOmpany--as
an extension of the Market street sub
way--wil not be burdensome.
When the so-called Taylor agreement
was formulated and presented to Coun-
ellis, the present unprecedented abnor-
NAL conditions were not in sight or con-
templated.
The company was making nearly 2
per cent on It's stock, and then II aD-
peared that the earning capacity of the
present system would at the present
rate of fare. with exchange tickets elimi-
mated, justify continuation of per
cent dividends on the stock
Therefore. 1t was then agreed that the
company should he assured 5 per
cent return on it's stock, In consideration
of its providing and financing on 6
per cent basis the cost of equipment of
the city's high-speed lines and the cost
of future extensions Of its surface sys-
tenn. and in consideration Of It's co-opera-
tion in operating the city's high-speed
lines with free transfers.
The company is now unable to agree
to supply the equipment for the city 8
high-speed lines on a per cent basis
or upon any other basis.
The city Is unable to establish the
h.gh-speed lines now. as contemplated.
for operation by the company.
The city has inadequate borrowing
capacity to provide the equipment for
its high-speed lines IN the future when
they are built, and cannot secure the
borrowing capacity required to provide
their equipment except by very gradual
process. as each line becomes self-sus-
tarirg. in whole or in part, during CT
after the second year of its operation.
Thus the city would be required. by
roasn" ~ the company's inability to pro-
vide equipment for its high-speed lines.
to build one high-speed line and then
pause until 4 became profitable before
building another hlgh-speed line. and 50