Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1918-06-04
TRANSIT LEASE WAR NECESSITY,
ATTORNEYS TELL UTILITIES BOARD

to grant unlimited and perpetual fran
chises upon the streets and to approve
and recognize the turning over of those
franchises for operation TO companies
which have furnished the new capital
necessary to transform the old horse
car lines into modern electrical systems.
The testimony of Director Twining
shows that the total rentals and pay
ments, including the per cent divi-
dend on Rapid Transit stock, is equal to
but Sc per cent upon the actual cash
capital invested in this property"
Among the other points brought out
by Mr.. Ballard were
IF the obligations of the P. r. r
Company are bar to the making Of
the present lease they are a bar to
making any lease at all.
Those who inveigh most loudly
against these rentals profess to have
no animus against the p. r. T. Com
pany and admit that the return which
the company is asking on its full-paid
stock is reasonable and proper re-
turn. The loss of fourteen years In
terest and the restriction of future re-
turns to per cent is the penalty which
the Rapid Transit Company pays for
the condition complained ola condi-
ton which, with respect to high rentals
paid to all the underlying street railway
companies, 1t is in no way responsible
for
Says City's End wouIdnt Pay.
1T must be remembered that neither
the present contract nor the situation
"hlch led up to it is of the compary's
own choosing. The city determined to
supplement the 'company's system by a
number of high-speed lines. designed to
develop the ctys industries and serve
the public.
This never was a business venture
NO one has ever pretended that the lines
would pay in business sense, and the
record before you shows that they can
not be made to pay with five-cent fare
or a seven-cent fare. or in fact at anv
rate of fare
They are municipal enterprise, and
they VIII serve the municipality best if
operated in conjunction with the con,
panys system. and therefore the city
presents to the company a form of con
'ract which provides that the city must
always have full return upon its in
Nestment. although the investment it.
self cannot earn that return.
OF course the return must come from,
| somewhere. It will come partly from
an increase in fare and it will come
pdrtE from the earnings of the Phila-
deiphia RAPID Transit Company's sys-
tenn, which earnings otherwise would
go to its own stockholders
The worst thing about this cortrac;
is that it does not face the fare oues.
| tion bravely. but starts in with an ar
tempt to decrease fares to the extent Of
| S1,000.000 a year in the face OF facts
understood by every one that all costs
particularly wages. have advanced and
will advance to n point which has ma do
every necessity of life virtually doubl,
in cost. The proper way of meeting
that question would have been for thi.
contract to have substituted a hishe,
fare for the present fare in connection
with the elimination of the exchang.
ticket.
six months ago. however, when thi,
contract was being drafted condition.
were not as serious as thew are today
were not as serious as they are today
pany with its large cash surplus coulc
well afford to postpone the increase o
fares until that surplus had been us,ec
up to the extent of half million dol
lars
Lays Difficulty to City
THE progress Of events and the de
mands of labor have. however forced tn
company's hand before this contract be
came effective, and have compelled it T.
|, ask Councils for permission to file a
increased schedule cf wares forthwith
The failure Of the city to complete II
lines within schedule time. the rapi
growth of the city's population. and tn
Importance Of serving the Governmer
industries there located. have raise
transportation problems in the city {
PHILADELPHIA which must be met by til
Philadelphia Rapid Transit Compan,
and which can only be met by that CON
pany If it has an adequate fare and a
assured future.
The argument presented by c. Osca
Beasley in opposition to the lease re
viewed the case, and embodied oppos
tion to the lease on three points. a
follows:
Facts which show that the contrat
should not be approved: legal objec
tions to the approval Of the contract
economic and social objections shown
that the lease is violative of soun
public policy
Ballard Refutes Beasley
Attorney Beasley attacked the pre-
posed lease after Mr.. Ballard had cor
cluded.
He charged that s1l900,00o of tn
s3o,o00,00O represented as the capt.;
of the p. r. T. Company was investe
in the stocks of underlying companie
He asserted that it was wrong to as
a dividend on it. as not one dolla
of it had been spent for improvement
Of service.
That is not true" interrupted NJ
Ballard.
How many millions of the P. r. T.
a money is invested in the stock of II
. underlying companies?" asked Mr.. Bea
!. ley
4 Not any," replied Mr. Ballard.
r Then the report of the controller
4 misleading" was the retort of M
asley
= Commissioner Ryan, OF Philadelphi
: indicated interest in the proposal of II
S opponents of the lease for a physic'
: valuation of the P. r. T. property.
DO you ask for a valuation Of Il
: entire property" asked Commission
r Ryan.
d Absolutely" Mr.. Beasley answere
e 'or how could you determine rate
y fare equitable to the car riders"
: The commission took a recess unt
t o'clock at the conclusion of M
i Beasley's argument.
Debate On Valuation.
I Edward B. Martin, of counsel
/, the United Business Mems Associatio
y was the first speaker when the hearil
was resumed. Mr.. Martin opposed I
lease.
h He was followed by Dr. Lewis. who
q argument took up the greater part
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