Evening star., 1921-03-29
7-CENT FARE WITH
l0-CENT POWERFUL
|NDEC|D|NG RATES
Commissioners Gave Serious
Consideration to Com
promise Proposal.
OYSTER TO PRESS PLAN
TO AGREE ON VALUATION
1mpounding of 1-2 Cents Each
Kilowatt Hour Under Court
Order Factor in Situation.
BY JOHN l.. MARTIN.

4A1ioWdtG I1UuI OuUcI SUult
Order Factor in Situation.
BY JOHN l.. MARTIN.
Disclosures having an admittedly
important bearing upon the question
of rates for utility service in the
District in the future today followed
the action Of the Public Utilities
Commission yesterday in continuing
for five months the present street car
and electric light and power rates.
1t developed that the commission
gave serious consideration to a COM
promise proposal to establish a T.
| cent fare, but restore the charge for
electric service to the pre-war figure
| Of 10 cents per kilowatt hour. Solu-
tion of the traction fare puzzle by
some such method is indicated as a
possibility unless plans for merger
| take definite shape within the next
flve months
Oyster to Push Proposal.
Another fact that came to light to-
day is that Commissioner Oyster is
preparing to push actively his sug-
gestion for a compromise on the trac-
tions, with the object of establishing
basis for merger. He has gone
sufficiently far with a preliminary
and informal inquiry to become con-
vinced that the plan is feasible
The Commissioners idea is that
| there should be a commission of six
members - two representing the
| Washington Railway and Electric
system, two the Capital Traction
Company and two the public utilities
4 h., fhn iVfc N
pute between the board and the COM
panies and. il possible. adjust the val
uations SO that they would be ac-
ceptable to the interests involved and
| to the public. The differences in the
valuation ratings involve several
millions of dollars and arise princi-
pally through claims for intangible
values. The court fight over the re-
spective claims is just beginning and
| is expected to last two or three years
! at least.
Companies Welcome Effort.
If this litigation could be taken
from the courts by a compromise
agreement. it is the belief of Commits
sioner Oyster and others with whom
he has discussed the matter that
merger could be effected in short
| time. Both street railway companies
have expressed a desire for a merger.
and both have gone on record to the
effect that they would welcome an ef-
fort to adjust the valuations outside
of legal processes
informally by the utilities board. and
will be taken up again during the
week. That the heads OF the railway
interests will be invited to an in
formal conference with the members
of the commission to consider the
merits of the plan is considered likely.
The commissions action. back in
1917. in establishing the rate OF
In fAN al -.
light sold in the District had great
deal to do with it's determination yes
terday to continue existing street car
fares. This charge subsequently was
increased by the commission to Sls
cents, but consumers are still paying
the old rate of 10 cents. because the
Potomac Electric Power Company
took the case to court. OF 10 cents
collected, the company. by direction
of the court. impounds y cents. SO
against the company The overcharge
can be returned to the subscribers.
Greater Number to Benefit.
One member of the commission, il
is understood, favored restoring the
electric rate to 10 cents and reducing
the street car fare to cents, because
he estimated 1t would save the tax
payers of the District approximately
half a million dollars He showed
that an increase in the electric rate
would affect about 41,000 subscribers,
whereas a reduction in street car fare
would benefit about 160.000.000 riders
in the course of year. Under this
plan, taxpayers would pay $392,944
more for lighting and electric power
annually, but $S76,754 less for street
car rides. which would be a saving to
them of $4S3,310.
This plan might have been adopted
by the commission but for the fact
the valution placed upon the property
of the Potomac Electric Power Com
pany is involved in the commissions
Sk cent electric light and power order
which is to be reviewed shortly by
the Court of Appeals. The commission
felt that the valuation situation might
be muddled il it put the electric rate
back to the 1917 figure before the
Court of Appeals has acted in the Po-
tcmac case.
Different Views Held.
All three members of the commits
sion approached the street car and
electric rate problems with different
suggestions for their solution. At
their first meeting they were widely
separated in their views The gaps
between them gradually lessened. how
ever, as other conferences were held.
and the decision finally reached repre-
sented their unanimous opinion that 1t
was the best plan that could be adopt
ed for the present
claims of the Washington Railway
and Electric Company that at the
present rate of fare it was earning
less than per cent. 1t was contend
ed by the company it could not oper-
ate efficiently and market it's secur-
tiles for the purpose of financing i'm
provements and extensions il the rate
of fare were reduced. A seven-cent
rate would produce return Of less
than per cent, it was claimed.
The broad position was taken by
tine commission in its findings that to
expect and require local utilities to
operate efficiently they must be per-
mitted to charge a rate which will
give them a fair return on the in
Vestment. Notice was served per-
sonally by the commission on the Off
cials of the Washington Railway and
Electric that they would be expected
to show improvement in service by
the time the new rate order expires.
August 81.
Side Signs Ordered.
The order directs the Washington
Railway and Electric Company to
sisns similar to those on Capital
Traction Company cars. The commits
sion also tells the companies that it
believes income taxes should be borne
by the corporations and not passed on
to the public in the form Of an operat-
ing expense.
Reference is made in the order to
the desirability of a merger. 1t is
stated the merger question has artss1
in every street car fare case that had
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