Evening star., 1928-05-09
ACTION ON MERGER
MAY Be DEFERRED
Situation in Senate Causes
Doubt of Final Vote Until
Next Congress.

with the merger hearings finally at
eIose the House District committee will
I'D an executive session Friday morn
ms to take action on The Joint reSolu-
ton authorizing the agreement under
which Washington would exchange its
ccmuctItiye street railway operation for
n unified non-compettiYe system oi raii
and bus transportation facilities,
While indications point to a faVor-
able report by a divided vote, the UNI
certainty which involves the situation
in the Senate gives cause for doubt
whether there VIII be any final action
on the merger at this session of Con-
crcsS. Tho decision Of the Senate Dis
trict committee. it vas said, VIII not
be determined until the action OF the
House is known.
Two alternatives face the House COM
rittee. IT can either pigeon-hoIe the
merger agreement for the remainder OF
the session or it can vote TO approve
or disapprcye il in its entirety. Mem
bers Of the committee are generally IN
accord with the opinion rendered by
Corporation Counsel w w. Bride that
81 is without authority 10 alter or amend
the resolution Any changes made by
the committee, ii was said would
amount 10 a counter proposal when
would have 70 be re-submitted tc vote
Of the stock holders in the three merg-
Ing companies.
sIav BE Held Over.
Favorable action on the merger by
the House would hold over until the
neNt session Of Congress, even the
Senate refuses to act at this time. That
woulo remove the necessity OF the House
committee holding further hearings.
Should both committees refuse 10 ac-
cept the agreement in its present form
members point out that they have un-
til June 1929. before the agreement
expires, in which TO work out COM
promise acceptable 10 the companleS.
Since the Public Utilities Commission
and Ralph B, Fleharty, peoples coun-
sci. have given their Endorsement OF the
merger plan. majority OF the House
committee seem 10 favor acceptance OF
their views so that the House can dis
pose Of the question now.
A further acquisition of local traction
stock by the North American Co. Of
New York. since May !, was revealed
for the first time al the hearing yester-
day and caused some surprise.
Harley p. Wilson. q director OF the
North American Co, who initiated the
merger negotiations. told the commit
tee that this company now owns sos
per cent Of The stock Of the WaShlng-
ton Railway & Electric Co. and
little over" 3 per cent Of the stock OF
the Capital Traction Co.
Holds Actual Control.
Officials Of the Public Utilities Conf
mission had testified at the hearings
only a 0ay or so previously that the
North American Co owned ~ per cent
of the stock Of the Washington Rail-
wsy &, Electric Co. and company ofs
fcers had agreed that this gave the
outside company an effective controL
Wilson explained that the additional
33a per cent Of the stock had been ac-
o9irpd since May !. which would give
the North American Co. an actual con-
trol
This disclosure served to increase the
alarm Of William Nick. Clayton Of the
Fadfratlon OF Citizens Associations that
the North American Co. would use It's
control TO rnonopolize electric power IN
the District. since the traction COM
ranv owns the stock Of the Potomac
Electric Power Co.
Mr.. wilson. however. assured the
committee that the North American Co.
has no intention Of interfering with the
operation o. the merged companies
that is policy as holding company
Is not 10 concern itself with local OPP
erstions.
aIf IL doesn't like the way things
are operated here it can withdraw" he
said.
Balks al Compromise.
Representative Gilbert Of Kentucky,
who Is opposed 10 fixing a $50 600 600
rate base in the merger agreement Tor
period of 10 years made several coun-
ter proposals to Wilson In an attempt
70 effect compromise. Wilson. however
said he cid not think elimination Of the
a5G 900 coo rate base would serve any
good purpose Such value. he said.
would be advantageous 20 the car riders
and vas necessary IN the agreement 70
satisfy the stockholders.
Asr. Gilbert wanted TO know IL he
would accept such a rate base for Two
years. during which the fares would
continue for that period. but MY VII
son could not pledge himself. He also
felt IL would % unwise 70 include q
clause for the arbitration of labor dis
p3teg. believing that should be left as
. managerial function.
As ~ the question o. reduced iaref
for school children, he said he was quite
wiling 70 accept that proposal should
the Public Utilities Commission agree
10 IL. Unlike some others, he believed
st1e commission already was vested with
authority IN order special fares for
Minors. but he cid not think 3 provision
ordering reduced fares for them should
be written Into the merger agreement.
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