Evening star., 1921-10-10
TAXATION CLAUSE
in CAR MERGER BILL
STRONGLY OPPOSED
Chairman Focht o! House
Committee Emphasizes I'm
portance of Legislation.
MEASURE UP FOR DEBATE
Bill as Introduced Would Change
the System of Taxing the
Companies.

Vigorous opposition to provision in
the two railway systems in Washing
ton which would change the system of
taxing The companies and relieve them
from other costs was voiced when the
hill came up for consideration in the
House today.
With time unlimited for general de-
bate. this so-called street railway mer-
ger bill was the special order of bust
ness for today and tomorrow. Chair
man Focht OF the House District COM
bill. and was interrupted by frequent
inquiries and debate regarding the tai
relief granted the street car companies.
Representative Joe Walsh of Massa-
cFusetts. Representative Sanders Of
Indiana and Representative Graham of
illinois were the first to oppose the
bill on these grounds.
Criticism by Mr.. Walsh.
When the measure was $frst called
UP by Chairman Fochr, Representative
Walsh criticised the fact that it had been
introduced. referred TO committee and
reported out all OH the same day. Oc-
&c Der !, placed on the union calendar
and brought up for business on Octo-
ber 10. Representative Foch: exolaiped
that the hill had been previously
amended and ordered reportes. out by
the committee, and that the ren9.sed bill
ana report We're hurried thrS Ugh OH
October Z in order to be readV sor con-
sideration in the House today
chairman Focht endeavored 90 have
nah f,. l5Tr1f tod lva
but Representative Blanton Of Texas
d member of the House District COM
m,ttee. objected. Representative SIN
G1.t nh OF Oregon was called to the
Mr.. Rocht told the House that outside
of expansion in school facilities this
Was the most important Legislation
affecting ths District that win conn
before the House for some time
Representative Focht reviewed th.
extensive effort that had been mad.
by industrial leaders and by ConGres.
to straighlen out the street raiiwa&
situation. He also reviewed the pc
culiar problems of urban and inter.
urban lines involved in the local sii
uation.
Representative Sanders argued thu
the change in tax should be made d
pendent npoH consolidation of th-
street railway property. 1t was eN
planned to him by Representativ.
the subcommittee which held hear
ings and who wrote the report on h~
revised bill. that time limit untH
next July is granted the companies
within which they can receive bene-
fits of tax reduction through consol;-
dation. following which an excess
profits tax would be imposed.
Sentiment for Merger Gnanimops.
Chairman Focht told the Hous,
that there is unanimous sentiment
that merger hill must he passed
How to bring a merger about 10 the
He explained the tax measures pro-
vided for in the bill and the reasons
that actuated the committee in ap
proving the proposal.
Representative Graham Of Illinois
discussed the question of establish
ing fair return and the attitude of
the House District committee in FIX
ing certain amount which the Dis
trict lines should be allowed to earn.
Representative Blanton of Texas
took the floor as leader of the oppo-
sition to the merger bill. He charged
as democratic member of the com
mittee. which had considered the 10
cal problem, that the bill under con-
sideration would neither reduce fares
nor bring about merger. He asked
his colleagues il they were in favor
Of relieving the street car companies
from paying s699.5J0 in one item of
tax and saddle this upon the people
of the country. who have to pay 40
per cent of the reduction in revenues
for the District that would entail.
Presents "EssentfaI FRcts.-
Representative James L. Woods of
Virginia laid before the House Ii
husinessIike statement of the essen
tial facts on which the House District
committee drafted the proposed leg
islation. In response TO repeated
questions from republican members.
especially from Representative Gra-
ham of Illinois, Mr.. Woods explained
how a fair return on a fair vaiua-
ton Of the property of the street
railway companies was arrived at-a
fair valuation being determined MOI
from the companies own claims. but
from a survey made by the Public
Utilities Commission al pre-war
prices.
Mr.. Woods told the House that.
roughly. this valuation was. for the
". X. & f. Company, $16.O00.O00; for
the Capital Traction. S15.O00.OO0. and
for the F. F.. r. Company, $16,000.000.
He explained that all of the capital
stock of the Z. E. +. Company is held
by the w. r. & Z. Company. Repre-
sentative Woods next pointed out that
the gross receipts of each railway Is
about the same. but their net receipts
are very different. The w. r. & z.
Company. he said. operates 1870 miles
OF trackage. while the Capital Tfac-
ton Company. operating in a con-
sested area. operates only about
sixty-two or sixty-three miles Of
track. =.
Answers Criticism.
Answering sharp criticisms made
by Representative Blanton OF Texas
that this bin is really the Woods bill
and was introduced at the eleventh
hour bearing Chairman Fochts name,
Representative Woods explained that
II is not any one mans bill. 1t Is the
committee bill. he said. and very pro-
periy introduced by the chairman at
my request. This 10 in accordance
with tho usual custom for the chair
man to reintroduce any bill amended
and redra fled by the committee.
Representative Woods pointed ont
that the survey that was made has
shown the Capital Traction Company
earning about II per cent and the
w. r. & r. per cent. The situa-
ton has changed q little, he said, 30
that now the Capital Traction Com
pany ia earning about 10h per cent
and the w. r. & E. about Pc
cent.