Evening star. [volume] (Washington, D.C.) 1854-1972, 1924-02-29
Scent FARE RUIN,
DECLARES Hanna
CAPITAL Traction Official Says
Mcclellan Bill Would
Starve Line.

Establishment of five-cent-six-
for-a-quarter fare on the lines OF the
Capital Traction Company, con-
.emplated by the Mcclellan bill now
pending before the Senate. would
tIaye a disastrous effect" on the COM
pany and would mean It's starvation.
John II. Hanna, vice president and
general manager Of the company told
the Senate subcommittee on the Nc
Kellar bill at a hearing today.
Reading from formal statement
which he said represented the posi-
ton of the Capital Traction Company
or the measure. Mr.. Hanna declared
that with tho fare proposed In the
Mcclellan bill, an increase In pas
required on the lines of the company
20 give sufficient revenue for operat-
ing costs and a minimum return on
fair value. He added that the COM
the assumption that car riding VIII
continue to fall off, as 1t mas zone
for the past three years.
The hearing was marked by debate
between George f. Hamllton, presid
Senator Copeland of New YORK. VINO
objected TO a statement by Mr. ham.
ilton that charges and attacks against
the street car company have been
made which, he said. caused misap-
prehenSjon as to the company STAND.
Senator Copeland also objected to a
portion of Mr.. Hanna's statement in
which he said there has been dis,
position to question the validity and
truthfulness of the books, accounts
and reports of the company.
Monday Morning EnusiOn.
Senator Ball, chairman Of the Dis
trict committee, proposed to elimf-
nate this portion OF Mr.. Hanna $
statement, but Senator Copeland said
.E,zSI %
main, characterizing it as a Mon
day morning effusion." He added.
however, that It was very dtspleas-
ing to him to have executives of the
company come before the subcommit-
tee and question the motives of mem
bers who, ne said, were only actu-
:tted by motives concerning public
policy and in the protection of the
public.
Mr. Hanna gave 1t as his opinion
that the value OF the Capital Trac-
ton Company. given by the Public
Utilities Commission in 1919 of $16,-
$4,000. IS d conservative value and
will be very considerably increased
by the courts when the matter Is
:inally settled there. He said he
based his opinion on the Potomac
Electric Power Company's decision
In a similar valuationscase.
Directly concerning the pending
measure. Mr.. Hanna said: Rate
equation Is the most important
function of utility commissions: to
take it out OF their hands would be
10 cripple their regulatory powers to
such an extent that the logical con-
clusion must be the abandonment of
commission regulation and the return
to conditions of over a generation
ago. when all railroads and other
utilities We're political foot balls
1923 Rate of Return.
The Capital Traction Company. he
said. earned rate of return for 1923
on the average weighted fair value
the years 1919. 1920 and 1921 the
company earned returns on its fair
value Of from to 10.4 per cent. These
earnings, he declared, were greater
than would ordinarily be allowed un-
der commission regulation. but were
not excessive and were nowhere near
as large as the company had been
popularity credited with having made.
Increase in operating expenses. de-
spite determined and continuous ef-
forts to economic wherever possible,
Mr.. Hanna added. since 1914. has been
IFS per cent, while the increase IN
revenue has been lis per cent and the
increase in rate OF fare 60 per cent.
street railway materials Is upward
and there is no indication OF any re-
duction in wages, he said.
Mr.. Hanna declared that II the pro-
posed fare had been in effect during
1923. other conditions remaining the
same, the revenue would have failed
by nearly 100000 to meet actual OPP
Grating costs and taxes. In Seattle,
he added, under municipal ownership,
when the street car fare was re-
duced from 10 cents to cents. an In
crease of about per cent In pas
sengers was reported and the ten
cent fare was re-established.
Answering a question from Senator
Copeland as. to possible decrease IN
the company's revenues. due to decline
in the population of Washington, Mr..
Hanna explained the population OF
this city was estimated in 1928 as
448.619. The number of federal en-
ployes Is steadily decreasing, he said.
is larger than in 1920. when the fed
eral census was taken. Federal en-
ployes, however, he added, are street
car riders. while those who have made
population-437.571- the estimated
1923 population are not street car
riders
Accountant Questioned.
Examination by Senator Mcclellan,
author of the E-cent carfare bill, of
Z. v. Fisher. an accountant of the
on whether an item of more than
SSo0,010 entered on the books Of the
company for old equipment was used
for fixing fares. During the course of
the examination of Mr.. Fisher Sena-
tor Mcclellan said he did not think
the Public Utilities Commission Of the
District is obeying the law in fixing
the present rate of fare on the street
car companies of Washington, ex-
planning that he was not against
reasonable expenditures for upkeep
OF trackage and equipment.
Rpnrndnrfjnn ha
railway companies Of the District to-
day would be greater by about $4.-
100000 than the valuations of 1919,
which were based on 1914 prices. Mr..
executive secretary Of the Public
Utilities Commission, explained the
commission takes as a fair value Of the
railway companies the cost price Of
any aed nrons o to eanipment I'm
the past few years have not been
taken into account he added. al
though Senator Ball declared that the
cost of property in Washington has
Increased greatly since 1914.
Mr.. Allen was asked by Senator
Mcclellan why members Of the Public
Utilities Commission did not appear
at the present hearings without be-
ing asked to testify. He said he be-
them available to questioning in case
they were needed. The Tennessee
senator said he could understand
why he has the disapproval Of the
Capital Traction Company, in answer
to statement by Mr.. Hamilton.
which did not charge him with such
disapproval. 81 think the fares ought
to be lowered" he declared. Tho
committee adjourned at noon to meet
again next Thursday morning at 10
o'clock.
DAUGHERTY TO STAY