Evening star., 1928-04-18
c. Of c. ENDORSES
MERGER PROPOSAL
Plan Gets Majority Vote After
Sharp Debate With
Traction Heads.

meeting on the proposal at the Wash"
ington Chamber of Commerce last night
at the Willard Hotel. melted away at the
close of 81 hour session after -four
traction officials had outlined the
merger agreement, and the organization
approved the plan by q considerable
majority.
The agreement as modified end APP
proved by the Public Utilities Commits
sion was defended as to financing and
management by William F.. Ham, presi-
dent OF the Washington Railway &
Electric Co: John II. Hanna president
OF the Capital Traction Co; Harley p,
Wilson. principal owner Of the Wash
iugton Rapid Transit Co. and author
OF the merger agreement, and William
Gibbs McAdoo former Secretary of
Treasury. who is counsel for Mr.. Wilson.
Attaching additional Importance to
the meeting. honor guests on the speak
ers' platform were Col William b.
Ladue. Engineer Commissioner andmem-
ber of the Public Utilities Commission;
Ralph b. Fleharty peoples counsef on
the commission: Utilities Commissioners
Brand and Childress. Charles J. Bell
chairman OF the board of directors OF
the w. r. & e F. D. Merrill, general
manager of the bus company. and other
transit company officials,
Defends Rate Base.
All upheld the $50. 900 900 rate max
ing base valuation as being about Sl2-
100000 less than what they computed
the courts would allow on principles
laid down in past valuation cases.
Car fares. 1t was contended, probably
would be less under the merger plan
than under future competitive opera
ton OF the companies, and the cham
ber was warned that If the merger fails
Of approval by the present Congress
the Capital Traction Co would apply
for increased fare under authority Of its
board Of directors voted last Fall,
A report strongly indorsing the
merger, and declaring that the inter
ests Of the public had been sateguarded
as far as possible as TO fares. service
and valuation. was submitted for the
public utilities committee OF the cham
Der by Harry King. chairman, who
asked It's approval by the full chamber.
When finally voted on, the merger
agreement was Endorsed by a clear
ma ioritv,
The King report reviewed efforts fer
a merger during the past 20 years.
1t is evident" the committee report
ed that the interests OF the city as
a whole should control in accepting any
plan as such general importance as the
one now under consideration. Such in-
IereSt Is concerned with the character
and cost Of service furnished, pTotec-
ton OF the rights OF future citizens, and
the enforcement Of the responsibilities
Of the companies as users OF public
property.
Freed of Police Cost.
The committee report. as indorsed by
the chamber, eoncurred in the recon-
mendation of the Public Utilities Com
mission that the unified company shall
be freed Of the cost OF maintaining
traffic officers. but that IL shall assume
one fourth OF the cost OF street and
bridge work OF the type for which the
traction companies now are wholly re-
sponsible
Favorable action on the merger dur
inc the present session Of Congress was
urged by the chamber.
Due 20 the presence Of traction and
city officials as invited guests feeiing
became tense during attacks by cham
Der members on the plan, The situ-
alton was relieved however. when Mr.,
King asked that the traction officials
be heard before the report was acted on,
Mr.. Wilson In A brief statement at
the close OF the meeting, discussing the
proposed S50,0o0.o00 valuation. de-
elared:
"AS a matter Of fact, the car riders
Of Washington have had snap as to
car fare~-more so than you realize.
The fact Is that the car companies have
been starving 70 death"
1aa sgzsa a
and he retorted. Your opposition IS
merely a state of mlnd--~not based on
facts, SIR"
Must Rhrn More"
The author of the merger plan then
declared that one Of two things must
happen In order that the investors In
the stock OF the transit companies be
enabled 10 make higher and more
reasonable" net return on their CAPT
tai,
They must have higher fares under
the present competitive system. The
present management OF the companies
must squeeze higher fares out OF you
til they drive you OF the cars he
warned, "or there must be unified
control and operation of the companies.
which will bring greater efficiency. bet
ter service and greater net profit 10 the
investors"
We are not trying 10 sell you on a
$4,000 900 valuation" he concluded
"Yoal already have got that"
Speaking as director in the North
American Co. holder of stock In local
transportation lines. Mr. Wilson an.
swefed charges that the merged com.
pany would be dominated by foreign
stockholders. lie said the North Ameri.
can Co does not manage or operate any
transportation companies IN which II
holds stock and promised local control
management and destiny OF the unified
company.
Mr. Ham reviewed the valuation
placed on the companies by the former
Public Utilities Commission and the
modification in the Capital Traction
case fixed BY District Supreme Court, as
upheld by the Court OF Appeals This
valuation, he reported was fixed al
S25 7b6 900. with capital additions bring.
ing II up tn $40. .427 900 Computing The
valuation OF the larger w r. A. II. Co.
he said. the total valuations Of the tive
| companies today would be IN excess oi
SD2 900 900
In the interest of obtaining a merger
| plan that the public and the Utilities
Commission could readily agree upon
an laiif tf 6hlus Llle FHluhtiUn was tlkeu
at $50 900 900 plus about So 900 00C
| track additions and other capital ex.
ptnhes
VIII Ask Fare Raise.
Mr.. Hanna announced that II the
merger agreement fails, he viii next
Fail ille application for higher fare fol
tbs Capital Traction Go,
Mr.. heAdoo discussed many phases
Of the merger plan holding the con.
soiidatl0n 10 be absolutely indlspen-
sable TO the public and 10 the com
| panies alike"
report indorsing the bill now IN
Congress providing for an insurance
code for The District and placing ad.
| dltlonal regulatory powers In the handl
Of the District insurance department
was submitted by Charles j. atockmar
and approved by the chamber.