Evening star., 1928-05-04
.FLEHARTY BACKS
TRACTION MERGER
Holds House Committee Has
No Authority to Modify
Agreement.

Ralph 3, Flehsrty. peoples counsel
appointed 10 look after the public
interest In the street railway merger
save blanket approval of the merger
pact III teStifying today before the
House District committee.
Agreeing with Representative Reid OF
Illinois that the District committee
must either approve or diSapprove the
agreement in its entirety. Fleharty de-
clsreo that in his opinion the commit
tee has no authority 10 modify. the
existing pact. Previously he had Sug-
EeSte0 that the committee could submit
notifications for the approval of the
street railway companies if they reached
the conclusion in executive session that
they could not accept the plan as
written, Reid said the committee had
no such power.
Cpholds Valuation Figure.
Declaring he has lived here so years
ana understands the public opinion
with regard to the merger, Fleharty
said he believed the people OF the Dis
trict are more interested in improved
street car service than III the charge
they would have To pay for it. He added
that the $4,000 600 valuation is less
Than reproduction cost and that the
companies undoubtedly would set a
higher valuation If they appealed.
Defending the merger as "a reason
ably fair and workable plan" Mr.
F3eharty admitted that an increased
fare was inevitable. but he contended
that with economies worked out the
possibilities Of an increase would be
more remote.
Flehartg, under croSs-examination.
said he did not recommend half fares
for school children or the inclusion of
labor clause 20 protect the car-riding
public from 8 possible strike in work
Ing out the merger compromise with The
Public Utilities Commission and the
traction officials. He doubted the au-
thor8ty Of the commission 10 take any
action with regard To reduced fares for
pupils and declared the matter Of arhi-
tration o. labor disputes was a question
solely for the traction management.
Opposes Valuation Elimination.
The peoples counsel opposed leaving
the valuation out of the agreement
Representative Gilbert contended for
the insertion of clause protecting tns
right OF labor TO arbiTate its differ
ences. SO as 10 protect against the pos
sibility of traffic being paralyzed st
some time by a strike
John II. Hanna, president OF the Cap
itsi Traction Co, who was questioned
hy Chairman Zihlman on this point
agreed with Fleharty that the labor
question should be left TO the conf
panieS.
So far as the Capital Traction Co is
concerned. Mr.. Hanna said. 1t had no
objection 10 empowering the Pubic
Utilities Commission 10 order reduced
fares for school children. Personally
he was opposed to the policy, admitting
however. that his objection TO it was
nog strong. but he did not think such
. provision should be put in the merger
plan
Mr. Gilbert warned that Congress
would inquire fully INTO the valuation
basis If the merger agreement coInCs
I'D on the floor of the House He ex-
planned that there were others like
himself who could not understand how
the public interest was protected by
in-year rate base guarantee.
Fleharty took the position that ang
increase of fares would be based on the
Sc. .G0o, 900 valuation for the l0-year
basis and not upon a higher valuation
should one be granted.