Evening star., 1928-05-08
W|LSONLAUDSCAR
MERGER PROPOSAL
Tells House Committee
Agreement Would Result
in Better Service.

American Co and a party to the
agreement. assured the public through
the House District committee today
that IT would gain better service at n
lesser rate than under multiple opera
ton.
mo better example of the policy of
multiple operation of transportation fa-
cilities can be found than in the city
OF Washington" wilson declared. ut
has been demonstrated in all the hear
ings that under this merger plan y
better service will be available at o
lesser cost for comparatively indifTer-
ent service under multiple control. by
making all the facilities available to
common end"
Mr.. Wilson was called as probably the
last witness at the merger hearing
which will be continued this after
noon. when the traction magnate Is
to subject himself to examination by
members Of the committee.
Labor Spokesman Testifies.
H. c. Hayden. representing the Gen.
trail Labor Union, whose members, he
said, comprise about one-third of the
population OF Washington. was the only
other witness. He made plea for the
| inclusion OF a clause guaranteeing the
right to arbitrate labor disputes and
on behalf of organized labor expressed
opposition to a liked valuation, though
favoring the general plan Of unification
Mr.. Wilson, who made brief state
ment covering his general views of the
merger, declared. that the demand of
the people here has been for service
and not fares" A satisfactory and ade-
quate service. he declared. has never
resulted in a quarrel with the public
over the fare paid.
Notwithstanding publicity to the con-
trary, Mr.. Wilson said he had been a
small party in the negotiations for a
merger
while 1t is true that these negotia-
tons were initiated by me, this is not
Wilson agreement" he said. This
Is a misnomer"
He reviewed briefly the steps leading
up to negotiations prior to which he
said he had spent the better part OF a
year studying transportation problems
in the metropolitan area Of the District.
management of the properties, he told
the committee his study had disclosed
that "a great economic waste was
going on"
Refers to Surveys.
Studies by engineers revealed that
certain economies were possible under
a merger. ranging. he pointed out. from
a minimum OF $l.000,000 to $3.50. 900
per annum. He quoted ROLAND C.
Bibben. transportation expert as giving
an immediate saving of $3.50 900 within
the first year
Hence this problem has been ap-
preached from an economic service
standpoint" Wilson explained.
With this immediate saving of
S850,000 Mr.. Wilson undertook to ex-
plain to the committee the difference
Of $4,000. 900 In the first valuation pro-
posed and the present rate base of
$50 100000, as written In the agreement.
Seven per cent Is what the COM
panies believe to be fair return" VIII
SON added, THAT per cent on Sl2.-
100000 happens to be $4,000. Hence
the $50 100000 rate base gives the new
company the same valuation for rate
making purposes that a S62. .000. 900
valuation gives them under multiple
operation.
This $50,000.000 Is for unification
purposes only because the interests of
the companies are equally served"
Reason for Rate Base.
Mr.. Wilson said there seems 10 be
some confusion in certain quarters ms
to what this merger means.
There has been a good deal of talk
about the altruiSm of the companies,
about throwing part Of the valuation
TO the public. That is not true.
THE rate base of $50. 900, 900 was IN
cluded not because the companies were
actuated by altruistic motives, but be-
cause the companies recognizes their
first duty TO the public and themselves
10 secure a return such rs they are en-
titled to and that the efficiency Of the
properties is In their charge"
MIR. Hayden declared the workers
want TO maintain industrial peace and
expressed II as their opinion that II
was unjust TO them and unfair TO the
public TO grant a private franchise
without including provision setting
up machinery TO carry out the principle
OF voluntary arbitration OF labor dis
putes In accordance with accepted prac-
tice."
He said labor was not opposed to
merger but believed that a valuation
base should be left out Of the agree
ment unless arrived at properly, sug-
gesting the medium OF Federal valua-
ton experts.
Representative Reid Of Illinois sug-
gested that he would hesitate To get
valuation because everybody says Vt
would bring a higher fare" During
discussion that ensued Hayden said II
Federal board or other proper author
tiles did place higher valuation after
q thorough study he believed his or
ganization would be willing 10 stand
by 1t.
Authority Question Raised.
Chairman Zihlman was asked by
Reid II he had submitted 10 the Attorney
General the question OF the committees
authority 20 amend the joint provision
authorizing the merger. Zihlman said
he had not, due TO the length OF time
u would require for the department 10
hand down decision.
Bride Gives Opinion.
The outstanding development at yes-
terday's hearing was the opinion REM
dered by Corporation Counsel w. w
Bride that the District committee has
no authority TO amend or alter the
loint resolution authorizing the merger
II must either approve or disapproVe," :"
Bride held
Should Congress. however, decide
that 1t desires To alter or modify the
terms Of the merger. II may do So"
kTide's letter read, but In legal effect
W would amount only 10 a counter pro-
poRai and be subject 10 acceptance or
rejection by the utilities involved.
Should the utilities take the position
that such legislation IL confiscatory OF
their properties or rights, that they
we're denied due process of law, or that
any OF their constitutional rights had
been Invaded, they would unauestiona
ably be entitled to seek relief IN the
courts that such rights may be de-
tefmIned"
The corporation counsel'a opinion was
transmitted To the committee at the
request OF Chairman ZIhlman 10 settle.
10 the committees satisfaction. ques~
llon raised by Representative Reid of
IlllIaAlE .lla.l. L.. -. =.