Evening star., 1924-03-06
TRACTION EARNINGS
FAIR, HANNA SAYS
Reached 7.76 Per Cent in
1923, He Tells Senate Fare
inquiry Committee.

The Capital Traction Company, in
1928, earned 7.76 per cent on the
weighted" fair value of the property
as found by the Public Utilities Com.
mission for that year, Vice President
| Hanna told the Senate District sub.
committee on public utilities at q
| hearing today on the Mcclellan scent
street car fare bill The rate earned
on the fair value, unweighted, was
given as 1855 per cent for the same
year.
This was fair return. Mr.. Hanna
said, but not unusually large. He said
that many public utilities commits
| sions In different parts of the coun-
! try have fixed 8 per cent as a fair re-
turn, still others have fixed a smaller
return, and further commission has
fixed term above 8 per cent.
! In. the opinion of Mr.. Hanna, the
| proper measure OF a return would be
| determined by what must be paid for
| money in community at the time. He
! called attention to the fact that the
present market value of Capital Trac-
| tion stock is less than par-from 81
! to 95, although the Capital Traction
] Company has had a good financial
| record, never having been in the
hands of receivers and good divi-
dend record, and the stock is now
| paying Z per cent dividend.
| Calls Division Fair.
/ The division made by the company
between the dividends and surplus,
/ he said, was a fair one. The surplus
| in 1923 after the dividends were paid
J was S1Ts, s,352.10. The Z per cent divi-
| dend amounted to $4,000. The net
4 ff1<-f -1,p .1r
! S.49 per cent. Mr.. Hanna pointed out
| that during the war period, when
| there was a great demand for money
! and money brought high rate of
/ interest, the Capital Traction stock
! sold as low as SO.
! The total amount of operating rev.
enues in 1923. Mr.. Hanna told the
committee, was S4,842,619.11. The
| total operating expenses, taxes and
miscellaneous expenses for the same
year amounted to s3,551 1858, leaving
| an operating income of S1,291,251. A
| fair value on the property fixed by
the Public Utilities Commission was
s16,s50,722. The revenue passengers
numbered 6s,652,s6S, at an average
fare of 7.o2 cents
Taking the year 1914 as basis, Mr..
| Hanna showed that the operating
( revenue had increased in 1928 over
(, that of 1914 115 per cent; at the same
| time, the operating expenses, taxes
1
| creased IT'S per cent. The operating
| income had increased "a per cent, and
| the per cent of return on fair value
had increased 10 per cent. The num-
Der of revenue passengers had in
| creased 33 per cent, and the average
| fare paid had increased 63 per cent,
while the population of the District
had increased IS per cent.
! Highest I'm 1921.
The operating revenues in 1921
reached the highest level, Mr.. Hanna
showed. s5,501.200. That year the op-
return on the fair value was 1912
per cent. That was the year of the
highest fare received, the average
being 7.45 cents per revenue passen-
revenues of the company were shown
| to be $2.255,9S3; the operating expen-
| ditures, taxes and miscellaneous ex-
penses sl,292,300;. the operating in
come $9o3,6s3 and the per cent re-
turn on fair value 6.91.
Mr.. Hanna pointed out that there
had been large increases in business
during the war period, starting in
1917, and that the receipts for the
company naturally had increased
mittee, however, figures showing that
the operating expenses also had in
creased very largely. In the early
part of 1920 the peak of the operating
eXpenses was reached, he said. In
1917, he told the committee, there had
been strike on the Washington
Railway and Electric Company's lines
early in the year and the United
States entered war, bringing a tre-
mendous increase to Washington in
population. Both of these were fac
tors, he said, in the increase in busi-
mess.
Quixzed by Mckellar.
Senator McKelIar of Tennessee. au-
! thor of the 5-cent fare bill, asked Mr..
| Hanna If he did not know that the
| street railway corporation operating
over virtually all of New Jersey had
| within the last year asked permission
: of the New Jersey public utilities
commission to return to a five-cent
| fare because the company could make
| so much more money on that basis.
| Mr.: Hanna replied that he had
heard a different report. He pointed
out that in New Jersey a zoning sys-
| tenn had been established. and that
| the scent fare was charged for short
| hauls in the cities, and as soon as
the boundary was reached an Scent
! rare was charged. He said also that
| there were no free transfers, which
! meant that some passengers who for
4 merly had travelled for s cents were
! now compelled to pay 10 cents, since
| they did not have the transfer benefit.
MIR. Hanna also was questioned about
the effect the establishment Of motor
4
street railway lines. He replied that
| only one line of busses had had any ap-
preciable effect on the street car lines
| and that was the Washington Rapid
Transit Company, with busses operating
! carried about 100000 passengers a
year. 1t now charges 8 cents fare and
| no tickets are sold at reduced rate
| This company. he added, is asking the
Public Utilities Commission for a TO-
cent fare. Mr.. Hanna said that it
| had been proven that the handling of
mass transportation In cities could not
be done as economically by bus lines
as by street car lines. Where the traf-
/ flo Is light, however, he said, the bus
line Is more economical.
Shows Expenses Increased.
Mr.. Hanna told the committee that
| the operating expenses per passen-
| ger had increased from 2.69 cents in
! 1917 to 5.15 cents in 1923. He then
described to the committee the in
| creases in wages and salaries paid
the trainmen received So a day when
| twelve and thirteen hours constituted
| a days work. In 1905 this had been
increased to 22z cents an hour; in
| 1915 it ran from 2ah to 81; in 1917
| the wages ran from 81 cents to 80
! cents an hour: in 1918 from 80 cents
| to 38 cents an hour, and in that year
an increase was made from 43. to 48
/ cents an hour. The highest point
was reached in 1920 when the wages
were 81 cents to Sc cents an hour,
and in 1928 the wages ran from so
to 56 cents an hour-a reduction
! of .2S of a cent per hour on the aver
| age.
The hourly rates were based on an
/ estimated working day Of ten hours,
| 80 days per year.
Mr.. Hanna described to the COM
4 mittee also. the increase in wages
paid shopmen and other classes of
| employees. The greatest increases, he