Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-10-21
The Lawful Rights
OF Street Car Riders
To the Editor Of The Star: =

A better time than the present may
never come again to aequaint the car.
! riding public with the law under which
the Public Utilities Commission Of the
District of Columbia is authorized TO
make valuations. Paragraphs and 7
thereof read as follows:
Par. 9. That the commission
shall ascertain as soon and as nearly
as practicable the amount Of money ex-
| pended in the construction and equip
merlt of every public utility, including
1.-the amount of money expended to
procure any right of way: also the
amount of money IL would require to
| any road bed, track, depots, cars, con-
| duits, subways. poles, wires. switch
boards. exchanges, offices, works, stor-
age plants, power plants, machinery
| and any other property or instrument
! not included in the foregoing enumera-
| ton, used In or useful to the business
Of such public utility, and 10 replace
all the physical properties belonging
| to the public utility. 1t shall ascertain
| lures and Indebtedness, and the amount,
respectively thereof, the date when is
sued, to whom issued, to whom Sold
| the price paid in cash, property or
/ labor therefor, what disposition was
made Of the proceeds, by whom the
indebtedness Is held. so far as ascer-
| tainable, the amount purporting to be
due thereon, the floating indebtedness
Of the public utility, the credits due the
public utility, other property on hand
| belonging to 1t, the judicial or other
sales of said public utility, its property
| or franchises, and the amounts rur-
| porting to have been paid. and in what
manner paid therefor, and the taxes
| paid thereon. The commission shall
| also ascertain In detail the gross and
net income Of the public utility from
all sources, the amounts paid for SAL
aries to officers, and the wages paid
to its employees, and the maximum
| hours OF continuous service required OF
each class. Whenever the information
required by this paragraph is obtained
| 1t shall be printed in the annual re-
port of the commission. In making
such investigation the commission nay
avail itself of any information in the
possession of sny department of the
Government Of the United States nr Of
the Commissioners of the District Of
Columbia.
Par. z. That the commission
shall value the property of every pub
| lie utility within the District of CO.
lumbia actually used and useful for the
| convenience of the public at. the fair
value thereof at the time of said VAL
| uation."
In this searching language the law
sets forth the facts necessary and the
elements essential to disclose a COM
public utility for public service. 1t en-
ables the commission TO understand
| what the condition of the utility is,
what 1t is doing, and whether 1t is
exercising its privileges properly to
| serve the public and to consider that
public interest on which it relies for
existence and continued support.
The most significant question that
arises in connection with consideration
| Would the law have placed upon the
! Public Utilities Commissioners the
nerye-racking and onerous burden Of
ascertaining the actual amounts ex-
pended in the construction and equip
ment of a public utility If it had been
| the intention of the law that the re-
production cost Of the utility should be
made the measure of the value of its
physical property? Obviously, this
tremendous burden of examining rec
| ordS and data would be herculean labor
lost II all the commission Is required
to do is to ascertain the cost of re-
| producing so many miles Of rail and
| road bed, so many cars, so much of
this and that and the other from an
inventory furnished to or made by the
commission.
1t should likewise be observed that the
law very clearly says that only the prop
erty actually used and useful for the
convenience OF the public"'sfiall be in
cluded at its fair value" In this vaiua-
ton which the law requires the Public
Utilities Commission to make.
Valuation Of a street railway under
this law was made in 1914 and was
based on actual facts, so far as 1t was
| humanity possible to secure them. To
| this the commission added the cost of
additions and betterments, based on
, actual facts as 1t ascertained them, and
found a fair valuation approximating
i $15.000,000. When the matter had
| finally taken its course through the
| courts the railway company came forth
with reproduction cost valuation on
its properly of more than $25,000.0o0.
There is nothing to be found in the
paragraphs of the law quoted which
says that the valuation to be found by
| the commission is for rate-making pur-
poses, or that any public utility is to be
entitled to earn any percentage of re-
turn upon the value Of its physical
| property.
But Mr.. Corporation Lawyer says that
you cannot take private property for
Tor words to that etfect, which is a
very good argument, indeed-until Mr.
! John Public comes along and replies,
why. you couldn't carry on your rail-
way business at all if you were not run
ming 1t on my property; and have you
ever considered how many times more
: valuable these peoples highways are to-
Gay than they used TO be?'-indicating
| quite clearly that there are two views of
| a Interesting
/ John Public Is giving for use great
/ deal more than he gets in service re-
turn.
But 1t is the fact (of which all men
may take notice. that volume of bust
ness has been the sole safe basis upon
which TO rely for dividends to street
car lines. The fact is that they made
more money and realized higher divi-
dends when traffic patronage was at a
high point, and that their returns
dwindle as passenger paying revenue de-
, clines. This is condition beyond the
! power of courts, commissions or rail
lines to control, and the public Is unable
to see the equity of placing upon the car
| rider individually the responsibility for
a condition which he has not brought
| about and is powerless to change.
! The one significant fact. above all
others confronting the public, is this:
With company valuation of $25,000.-
900 it requires $25O,o net income to
produce per cent return. With $l5,-
100000 valuation it requires but $780,
600 net income to yield per cent. One
! hundred thousand dollars more is taken
from the pockets CT the car riders to
produce that ! per cent return under
| $25, OO0, 900 valuation than is taken with
Sis, 000, 900 valuation A net income
of ST ,0O0, 900 on a $4,000, 900 valuation
| will produce but per cent return and
the market value of the securities Of the
company will be inclined to decline,