Evening star., 1919-09-24
BANKERS SUPPORT
HIGHER CAR PROFIT
E. E. Thompson and John
Poole Believe Utility Should
Earn 8 Per Cent.
BOTH COMPANIES IN CASE

Two Washington bankers. Eugene
f. Thompson and John Poole. testi-
fed. at the hearing before the Public
Utilities Commission to-day on the
application of the Washington Rail-
way and Electric Company for fur
ther financial relief, that a public
utility should be permitted to earn
8 per cent on it's investment under
present conditions.
The WashiL gton Railway and Elec-
trio Company is now permitted to
earn 6, per cent on it's investment.
Their testimony bore out similar
testimony given before the commits
sion yesterday by other witnesses.
Capital Traction Represented.
George E. Hamilton, president of the
Capital Traction Company, appeared
at the hearing in response to an or
der issued by the commission last
night making his company a party
to the proceedings.
In the order the commission stated
that it believed the Capital Traction
should come into the case for three
pressed intention of citizens to ask
that the two-cent transfer charge be
abolished if a higher fare is granted;
second. because of the claim made
by the Washington Railway and Elec-
trio Company that the revenue from
the two-cent intercompany transfers
is not equally divided: and third, be-
cause measured service, or zone
system. will be considered if it is
found that the Washington Railway
ri C0nnanv fnrther
relief.
Needs Time for Preparation.
Mr. Hamilton told the commission
this morning that while his company
did not want to stand on its right to
ten days before entering the case, 1t
wanted time enough to prepare It's
facts before being asked to express
opinions or make statements before
the commission.
Chairman KutZ of the commission
replied that it was the commissions
desire to give the Capital Traction
time for such preparation.
Attorney John S. Barbour, for the
Washington Railway and Electric
Company, stated that his company
had no objection to the other COM
pany coming into the case, but did
object to any more delay than Is aoso-
luteIy necessary. He said the Wash
pany's need for financial relief is i'm
perative.
After the two bankers have COM
pleted their testimony the Washing
ton Railway and Electric Company
expects to close it's case with an
other statement by William F. Ham.
president of the company.
After the company has rested it's
case William NICK. Clayton, repre-
senting the Federation of Citizens
Associations, intends to argue that if
.ny further financial relief is granted
the company it shall be accompanied
by an order revoking the two-cent
transfer charge.
Should Maintain Credit
Mr.. Thompson. in testifying con-
cerning the condition of public utility
securities. stated that in these times
a utility should be allowed to earn
return sufficient to MAINTAIN It's credit
and that company earning per
cent on it's investment could not hope
at this time to keep up its credit.
He said he believed it should be per
cent.
1t was brought out that the Wash
ington Railway and Electric estimates
it will need s1,o00.000 year for three
years in new capital to finance nee
essary developments in service to
meet the requirements of the public.
Mr. thompson IeStll1tu tIidt a COM
pany earning 6 per cent on the fair
value of it's property now could not
hope to do new financing at present
rates.
Asked by Attorney Barbour what
utility companies in the United States
have had to pay for new financing
the witness said from $40 to 1880
per cent per annum to maturity on
bond issues or note issues during the,
past year and a half
In answer to a question from Mr..
Ham. Mr.. Thompson said investors
now have an opportunity to put their
money in industrial enterprises with
prospects of much better returns
than in utility securities.
Mr.. Poole's Opinion.
Mr.. Poole declared that he believed
it reaSona BILE for a company to secure
a net return of per cent on it's fair
valuation in order to cover charges
for loans and to meet bonded indebt-
edness.
He said that he did not believe it
the duty of the commission to make
CONTINUED on Second Page.)