Evening star., 1928-02-16
Rapid Transit Merger.

FOR long peVioG II has been regard
&C as inevitable that the rapid transit
corporations in the District Of Columbia
should be brought together in con,b!na-
ton under single ownership and man.
sgerlsnt. From the point of view OF
public interest. i. has been accepted that
unified service under single corporate
management was no: only preferable
but was sure TO be effected. whether by
voluntary action on the part of the
traction companies or by mandate OF
law. In the circumstances there has
been decided public preference for
voluntary merger. Fo- long time
there seemed to be prospect of such G
unif!catio... Various proposals by the
District Commissioners. then acting as
O pubic utilities commission, failed of
effect. For some months past. how
ever. merger forces have been az work
and have now. to the qualification o!
the community. though subject to criti-
ca! examination, been brought to the
poi.t of deEnise project. accepted and
subscribed to by the three units of Dis
t-:ct transportation, the Washington
Railway s. Electric Co. the Capital
Traction Co. ana the Washington Rapid
Transit Co. a newcomer in the field.
Yesterday plan in detail. previously
adopted By the several directorates. was
formally laid before the Public Utilities
Commission. with petition for its ap-
p-oval by that body. with favorable
recommendation to Congress for the
legislation necessary to effect this
change. Public hearings before the
commission viii be held beginning Feb
ruary %. the intervening time being
available for close study of the plan
by the commission and by the public
This project involves the unihcation
OF the three corporations, with one of
them maintaining separate existence
for stockholding purposes, with a capi-
talization of 100000 and valua-
ton Of $50 900 900 for rate-making pur-
poses, the new company st!puiating the
right TO earn a return OF seven per
cent 1t rs with these points OF capi-
ta,ization, valuation and return rate
that the Utilities Commission and the
public VIII be chiefly concerned. 1t was
hoped that the project would not In
volve a seven per cent guarantee. that
the capitalization would be more mod
crate and that the proposal would not
be such as 20 tie the hands of the
Public Utilities Commission If It were
accepted in the matter OF fare-hx;ng, TO
the point Of prec.uding a lowering OF
the rates charged the public for services.
In all the discussion Of traction
merger that has preceded. one Of the
advantages 70 be sought has been the
possibility Of lower rate Of fare Jus
titled By the saving Of expenses through
unified ownership and operation. II
has never been accepted that unifca-
ton would be of any advantage 70 the
community unless through moderate
valuation and capitalization the COM
b.ned corporations could be placed in
position 70 render efficient service at
lower rate Of fare than that which has
been forced through the inequality Of
the financial positions 0! the two major
corporate units.
There viii De no public support for
n9ger plan which docs not promise
economics OF administration and opera
ton. and consequent economies In pub
lie expenditure through fares and rates
An exhaustive study Of this pEesen,
plan, which affords for the first tine an
actual working basis for merger. viii
be made by the Public Utilities Commits
sion, which will. no doubt, admit 70 the
hearings representatives of the CON-
Daunity. VINO viii voice the demand that
IN any action looking 70 the un!Acat!on
0. the rapid transit system the main
objective VIII De the joxee. possible rate
Of fare consistent with a reasonable
profit. based Gpoa q fair valuation and
o sound capitalization.