Evening star., 1928-06-16
The Fare Increase Application.

While the Capital Traction Company
is within its rights in applying to the
Public Utilities Commission for an in
crease OF fare, 1t is assured that this
proposal will be strongly resisted by the
community. II granted, this change
in rate, it Is estimated, will net the
corporation about half million dollars
additional in annual net income. which
will, OF course, come from the pockets
OF its patrons. Furthermore, 1t is
altogether probable that although the
immediate application was made by
only one Of the two traction companies,
the rate change, II granted by the
Utilities Commission. will apply to both
systems. For it is inconceivable that
there should be two rates OF fare In the
District. To the extent to which
the two systems are competitive a rate
increase granted to one and not to the
other would be Of no benefit, but would
perhaps be actually loss. Hence It
follows that the estimate OF an addition
OF S500,000 TO the carfare bill of the
people OF Washington involved in this
present application is minimum only
In the application TO the commission
the traction company calls attention
to the fact that the merger agreement
between the two corporations now pend
ing before Congress contains a provision
that "ti1e existing companies shall not
be precluded from requesting change
In fare IL this agreement Is not ap-
proved by the present session Of Con-
gress." Attention Is also called TO the
fact that during the course of the
recent hearings the statement was made
on behalf Of the Capital Traction Com
Dany that II Congress failed to approve
the merger agreement In the session
Just closed 1T could no longer postpone
application for an increased rate Of
fare without seriously jeopardizing the
rights OF It's stockholders
The merger agreement has been ap-
proved by the House Of Representatives,
but the Senate District committee has
held 1t over 10 the next session, pending
an inquiry by subcommittee. The
Public Utilities Commission, although It
has already approved the agreement
With certain notifications, win not
necessarily be justified In recognizing
the clauses just quoted as warrant for
arr ffyHfaaEt9fa spyxrrval ~ fE4z n,Nx.fsna -
ton for fare increase. Expressions Of
opinion by members Of the commission
on the subject Of the fare rates have
given rise u public belief that the
commission is In a measure committed
70 approval of such an application as
tnat now pending. II would be de-
/ cicedly the more equitable course for
the commission 10 pursue TO regard the
case az stili pending before Congress
despite the stipulation Of the agreement
relative 10 rate changes and the an
/ nouncenent made In the course of the
hearings For this application rests
upon valuation, which Ia factor in
the merger agreement which Congress
Is etiIi considering.
! Washington hopes for a merger Of
the two traction companies upon terms
! that viii insure II better service without
an !ncrease In fare. IL ig not persuaded
that the situation Of the applicant
! corporation ia such az IN require an
/ increase IN the fare rate white this
| question Is under consideration by Con-
gress. the assent 81 which Is necessary
before q merger can be effected. Such
an increase would materially change
the basic conditions Of The proposed
merger