The Washington times., 1920-02-04
WIRE. RUINED
IF FARE IS 10C
Gardiner Asserts People VIII
Walk II Charge Goes
To Dime.

"a lo-cent fare will put tho wash
ington Railway and Electric com
pany into the hands OF a receiver,
former District Commissioner W.
Gwynn Gardiner insisted this morn
ing before the House District Com
missioner when hearings were re
sumed on the bill intended TO pave
the way for a merger OF the TWO 'so'
tion systems In Washington;
was no hope for ia Washington Rail
wav and Eiectr Company unless
Congress gives II relief
This relief is not to be gained
through another increase In street
fares, he warned the committee' put
instead, IL can come only through .
return of at least 7 per cent on the
valuation Of its properties
The question OF an increaseo tai
way fare In washington prec,p'tseo
n lively discussion between MI car
diner and President w. +. Ham, OF
the Washington Railway and Electric
Company.
Ham Wants Raise.
NJ Gardiner went on record as OPP
po.ed to a further increase In rare
while Mr.. Ham took the opposite po-
sition, that the company not ohIy
needs Il, but would not suffer through
1t. x
Rather than pay lo-cent rare
Mr.. Gardiner declared, the people
would walk.
when you get beyond 7-cent
fare" said Mr.. Gardiner. "the people
are going to resent 1t. 1t Will WORK
to the disadvantage of the company
in the end.
I'm my opinion. the 1o-cent fare
will put the Washington Railway
and Electric Company into the hanas
of a receiver"
He disputed the statement by MT.
Gardiner that the railway companies
in Boston have gone back to o-cent
fare after a short-lived 10-cent fare
on the elevated lines.
Resentment by the public, MT. Gar
diner contended. forced the Boston
street car companies back to o-cent
fare.
Mr.. Ham told the committee that
he believed Gardiner was mistaken:
that the Boston traction system was
still charging a 1o-cent fare.
Both at LoEEerheads.
Mr.. Gardiner believes that 1t takes
time for the public to readcust itseit
to new conditions, that II the WASH
inston Railway and Electric Company
or any other street car company IN
Washington was granted more tnan
cent rate they would begin very
soon to feel the touch OF public re-
sentiment. He and Mr.. Ham were
clearly at loggerheads on this aues-
ton.
When tho hearings were opened
this morning Chairman Mapes calied
upon Mr.. Gardiner to go on tne
stand. Owing to a bad cold the TOT.
mer commissioner had been excused
from testifying yesterday.
The session this morning was
largely devoted to serious considera-
ton OF the legal points involved In
various court opinions as to What
constituted a fair and reasonable re-
turn on the property of public util-
tiles companies taken under connsca-
ton proceedings.
What in your opinion would be .
return that would not be con-
fscatory," inquired Chairman Mapes.
Seven per cent return would oe
a proper allowance" Mr.. Gardiner re-
' piled.
He explained he based this estimate
on various opinions handed down by
the United States Supreme Court and
other courts of last resort
He added. too. that he based IL on a
study Of street railway conditions In
Washington.
Mr.. Gardiner said that It had been
contended that s per cent is the least
that should be guaranteed to the com
panies. The committee could not quite
agree with this figure.
But less than per cent will not
keep them alive" Mr.. Gardiner de-
clared
II the companies could make II a
"so" on less. he said he would be In
favor of a per cent return. but did
not see how II could be done In view
Of the local situation.
to 10 Per Cent Lawful.
Mr.. Gardiner declared that the
courts have held an interest rate
from six to ten per cent as lawful IN
tho District Of Columbia under writ
ten contract
The United States Supreme Court he
pointed out, really settled the ques-
don of q rate Of return by holding
as legal q rate nxed at such an
? amount as will give the public utility
company the opportunity to acquire
additional money to carry on its busi-
ness.
Under various opinions. he explain
ed. 8 per cent was generally the rate
determined upon in oonnscatory pro-
ceedings
Suppose Congress should deter
mine to take over tho lines here and
operate themr' asked Chairman
Mapes. 'Could the valuation as nxet
by the Public Utilities Commission
be used a. q basisT'
Yes" replied Gardiner; but only
as nnslly determined by the court"
He said this would take from two
to Ave years owing to the congested
condition Of the court calendar.
I'm the meantime" he said. you
have a situation here OF a company
getting now on 7-cent fare a return
OF only AZ per cent, which is clearly
oonfscatory. It can't go to court be
cause IL Is so near the brink that II
will be In the hands OF a receiver be-
fore the courts can act"