The Washington herald., 1921-01-29
Report Made to House
FavOrs Passing Meas
ure for Combine.
REVIEWS TROUBLES
OF CAR LINES HERE
Declares Course Suggest.
ed Offers Only Cure
For Situation.

The Gould bill, permitting a rner-
ger of the Washington Railway and
Electric Company with the Potomac
Electric Power Company. was re-
ported favorably to the House yes
terday with a recommendation that
it be passed.
The committee, in its report, went
into the history of District traction
service and legislation governing
the companies, and declared that
the bill lis a prerequisite step
toward the promotion of a merger
of the Washington Railway and
Electric Company with the Capital
Traction Company.
Favors Merger.
The report declared that, after
many years of hearings and discus
sions, the committee almost unan-
imously has reached the conclusion
that a merger OF the two great COM
panies is the only remedy for the
unfortunate situation which now
exists
Tho committee, likewise, has
come to the conclusion that there
can be no equitable merger unless
the property of the Potomac Elec-
trio Power Company should be in
Cluded in the merger" the report
said.
Power Offers Problems.
The preponderance OF opinion is
that when the inevitable merger
does come the Capital Traction
Company, being the stronger fnsn-
cially, will be the survivor in re-
slity, If not in name. The power
i
cient to haul all the cars now owned
by 1t and the cars now owned by
the other company, and the number
of both must, of necessity, be con-
stantly increased"
Until about twenty years ago
there were a humber Of street rail-
way companies in the District, each
separate and independent of the
other" the report continued when
ever anyone wished to use a street
car for more than a very short dis
tance. he was compelled to use more
than one line. Because of the many
fares paid and transfers made, much
dissatisfaction. grew up among the
patrons of those many street rail-
way lines.
In order to allay that dissatis-
faction and TO give a better serv-
ice, Congress, about twenty years
ago, permitted a consolidation OF
number of the different companies.
Nearly all of the smaller companies
were acquired either by the Cap
ital Traction Company or by the
Washington Railway and Electric
Company, the latter acquiring the
larger number of companies.
The Capital Traction Company
has sixty four miles of track, while
the Washington Railway and Elec-
trio Company has 131 miles. A
large percentage OF the trackaGe of
the Washington Railway and Eiec-
trio Company is beyond the congest-
ed part of the city. while that of
the Capital Traction Company is
very largely within the Congested
part of the city. In the densely
settled and business part Of the
city, the two companies arc rivals
and competitors. That condition,
however, does not apply to the out
lying lines of the Washington Rail
way and Electric Company.
"As the Capital Traction Company
operates mainly in the thickly set
tied part of the city, its runs are
shorter and its cars are filled; in
consequence its operating eX-
penses are comparatively smaller
and its profits larger. Upon the
other hand, the hauls of the other
| company are longer; throughout
much of its length, its patrons fewer
in number. The result is that its
operating expenses are larger and
it's profits smaller, notwithstanding
! the fact that the Washington Rail-
way and Electric Company oper-
atcs, per car mile, at a lesser eN-
pense than does the other company.
The Capital Traction Company
owns its tracks. equipment and
power plant. Under provision of
an act of Congress, approved June
&. 1900, eleven different companies
were consolidated and became what
is now the Washington Railway and
Electric Company. Under that act
there was a provision which now is
deemed to be unwise, which forbade
the Washington Railway and Elec-
trio Company from owning the
property of the Potomac Electric
Power Company; thereby that COM
pany was permitted to own tracks
and equipment, with the necessary
real estate, but was forbidden to
own the power plant, a very valu-
able piece of property. The Wash
ington Railway and Electric Com
pany, under it's authority to invest
in stocks and bonds has purchased
all of the capital stock of the Po-
tomac Electric Power Company.
THE several propositions to merge
the two great railway systems con-
template a merger of all the prop
erty. including its own power plant,
of the Capital Traction Company,
but denies the Washington Railway
and Electric Company to put into
that merger the power plant. The
exclusion of this power plant from
the merger is the real obstacle
which renders the merger impossi-
BILE.
The bill will improve and
strengthen the credit of the Wash
ington Railway and Electric Com
pany,- and permit more economical
financing of needed extensions, ad-
ditions and improvements through
the creation of direct lien on con-
solidsted properties. rather than in
the form of collateral mortgage
pledging the stock Of the power
company. t.- r