Evening star., 1923-12-14
HAMILTON SCORES
Scent FARE BILL
Capital Traction Head Says
Company Would Lose
Heavily.

"A return TO the scent car fare.
with six tickets for % cents, would
be disastrous" to the Capital Trac-
ton Company. George L. Hamilton,
president of that company. stated In
letters sent today to the Senate and
House District committees and to the
Public Utilities Commission.
A bill has been introduced in the
Senate providing for a return to the
original rate of fare and was trans
mitted to the Commissioners today
for report
Mr. Hamilton sets forth in his let
ter that If the fare had been six
tickets for 25 cents. or cents cash.
during the first eleven months of
this year the Capital Traction Com
pany would have had an operating
deficit of s243.0S1, without allowing
for payment of interest on bonds or
dividends.
Return Now s Per Cent.
With the present rate of fare, the
letter shows, the company's return
for the eleven months was per cent
on the commissions valuation. Mr..
Hamilton expressed the belief, how
ever, that the commissions valua-
ton will be raised by the courts,
thereby reducing the percentage of
return. The letter, in part, follows:
For the eleven months ending No
vember 80, 1928. the operating income
of this company-that is. revenues
less actual operating expenses and
taXeS-was $1,204,S12.
This represents less than s per
cent on the fair value of the COM
pany's property as determined by the
Public Utilities Commission, which
value, we believe, will be materially
increased after final adjudication. We
base this belief on the decision of the
Court of Appeals of the District of
Columbia-valuation case of the Po-
tomac Electric Power Company. The
excess of these earnings over per
cent return on the commissions fair
value on a twelve-month basis was
$145,345. or less than one-fourth Of a
cent per passenger.
Had the rate of fare during this
period been 5 cents cash, with six
tickets for 25 cents, with the same
would have been s2.7s1.074. s65. .626
less than the actual operating ex-
penses, exclusive of taxes. Taxes
for that periodA after correcting the
6 per cent gross revenue tax in ac-
and eliminating entirely the amount
paid for federal income tax, would
have been s177,175, leaving a total
operating deficit of $243,031, without
giving consideration to the payment of
bond interest or dividends.
Had the fare for the same period
been cents cash, with no tickets.
our income, less operating expenses
and taxes, would have been $151.403,
which is at the rate of less than
l per cent on the fair value as found
by the commission and would have
failed by $113.220 to pay interest on
our comparatively small bonded in
debtedness.
No Passenger Increase.
"The supposition that a Scent fare
would largely increase traffic cannot
be relied on, for experience in other
cities has clearly shown that where
the fare has been reduced to cents
the increase in number of passengers
carried has been very small.
For the last two or three years our
traffic has been steadily decreasing
with no indication that this condition
will be altered in the near future
ON the other hand, operating ex-
penses, while somewhat lower than
in 1919-2O, are still very high and are
now even on the increase. The dis
astrous result of Q scent fare In
washington under present-day con-
ditions, therefore, may be readily
foreseen."