Evening star., 1927-10-23
BY /. A. FLEMING.

(
| Washington should have a unified
| system OF street railways with un-
! limited transfers and fares if pos
sible, lower than the rates now cur
rent. This is the almost unanimous
view Of the various citizens organiza-
| tioEs and of the rank and file OF the
| people of the city.
| And so it is that the presentation
| of plan for the accomplishment of
! this end, presented to the chairman
| of the Utilities Commission, has at
] tracted much attention, and practical
| ly every one is anxious for the fullest
| details, even though it has nov been
! withdrawn. on admission that Mr..
| Childress did not like it.
Whatever Mr.. Wilson's plan. 1t
seemed premature. In the first place
| it is not officially approved, so-faTe as
known, by the North American Co..
| the admitted owner of a large part OF
! the stock of the Washington Rail-
| way e. Electric Co. The Capital
| Traction Co. officials have not given
| it even the once over, and the WASH
| inSton Street Railway Co. must needs
give official approval--hence the plan
| Is Of small Importance until II SHAH
win the consent and approval of the
| varied interests involved in the pro-
posed merger.
Not an Easy Problem.
| II is by no means an easy task to
bring about the desired consolidation,
and any enc who anticipates lower
fares is doomed to disappointment
| with a certainty that cannot be doubt
| ed by those who recall that the right
of public utilities to a fair return on
| their physical vaulation is q funda-
mental fact.
Both the traction companies would
have been before the Utilities Com
mission before this with demands for
| higher fares but for the dread in
which they hold the $25 automobile,
| understanding that higher charges
would greatly increase the number OF
cheap autos carrying workmen to and
| from their work.
Not Earning Dividend.
The Capital Traction Co. has but
one kind of stock, has been for
some time paying PER cent annually
and has not been earning that, so
| that the deficit in the dividend re-
quirement has been dipped from out
| the surplus, and this is not considered
good business policy. The officials
of this company, which has been
given a much larger physical valua-
ton than that received from the
old utilities commission, know full well
that a request for higher fares would
be Immediately granted-else such
demand could be enforced in the
courts with the assurance that in the
court of last resort, the Capital Trac-
ton Co, would win.
| Shorn of the Potomac Electric Co.,
the Washington Railway and Electric
Co, would be in much less satisfac-
| tory position than the sister corpora
| ton Is today as it has SO many poor
paying feeders"
There is no danger of this separa-
ton, however, as the company owns
and probably always viii own Pepco
mr. does it seem at all probable that
| the North American Co.. even IT it
so desires, will ever find a way to
| separate them.
Does Not Hold Control.
There seems to be an opinion in
| lay circles that the North American
| Co, is in full control through majority
stock holdings, of the Washington
| Railway and Electric Co., but this is
not a fact. It is a large, even the
| largest owner Of the common stock
and also owns a large part OF the
preferred shares. 1t is also said to
control the directory.
OF the common stock there are
65 900 shares outstanding and also
/ S5 900 shares of the preferred out
standing The latter is entitled to
per cent dividend. Common also ie-
ceived 5 per cent up to relatively
short time ago when it was increased
| TO per cent. Both stocks have equal
rights in the matter of voting.
Since the first entrance of the North
American Co. into the local railway
situation with the purchase OF 2I,ooo
shares of Railway common, IT mas
been increasing its holdings. 1t is
also said to have acquired consldefaoie
stock in the Capital Traction Co., put
| ii is impossible to obtain information
as to the amount, shares being car
ried on the books of the company IN
| various names.
Initiating Prices.
With the advent of North American
| interests in the local situation. d
slow, but almost continuous advanc-
| ing movement in price of the common
| shares has been maintained, until To-
| day they are quoted not far from S4oo
q share, or a total valuation of S26,'
| O00, 900 and has caused more than one
| to ask. how, why and what on?
In the interim Railway preferred
with exactly the same voting power
and therefore desired in any effort to
| control the system. has been slow and
only within the last month has been
moving up with a little more show OF
| life. For long time 1t held around
and below the 90s and has just risen
near the par mark. 500 share. since
| the announcement of Mr. Wilson'S
| plan having been presented to Utilities
| Commissioner Childress.
x,l.x, off 20.
| ing fire for years around and not
| far from par. moved up since the pi es.
entation of the Wilson plan to the
chairman of the Public Utilities Com
| mission, the gain amounting to to
points.
It is not generally known that
merger plan was developed with the
/ II