Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-08-25
Change of Methods of Trac-
ton Bookkeeping Is
Held Likely.
FARE RAISE SESSIONS
TO START FIFTH WEEK
Retaliation Of Companies Also Is
Seen as Possibility by
W. NICK. Clayton.


will enter their fifth week at 10 am.
Tuesday before the Public Utilities
Commission. The case is drawing to its
close, but 1t is still too early for we'll
founded predictions as to its outcome.
The remainder OF the testimony to be
offered on behalf of the carriers. with
final arguments on the case, are ex-
pected to last another two weeks.
Whatever the outcome of the case
as to the fare the average passenger
will be required to drop into the fare
box OF the street cars, there is one out
come which seems at this time almost
a certainty. The companies will be
required to install completely new
system of accounting, under which
much of the confusion OF the present
case as to what their respective valua-
tions are. what items have been prop
erly added thereto. which items have
been properly charged to operating ex-
penses, which to maintenance or to
capital account, will be eliminated.
Questions Reveal Discrepancies.
The companies systems Of accounting
under the close questioning OF Com
missioner Harleigh H. Hartman, have
been shown to be radically different, so
financial status are extremely difficult
to make. A radical overhauling Of the
accounting methods of the Potomac
Electric Power Co. has already been
ordered by the commission outside OF
the present carfare case. and on this
ground alone, it is most likely that
changes in the street car companies
accounts would be ordered.
One possibility considered more than
hal
Clayton, counsel for the Federation Of
Citizens Associations, Is that in answer
to the companies petition for higher
fares the commission will order a COM
plete valuation of both companies. The
! Capital Traction Co. has not been
valued since 1928. The Washington
Railway & Electric Co. has not been
valued since 1919. Public utility COM
panies under the law, are allowed to
| earn a fair" rate of return upon their
valuation. The basis Of the present
requests for an increase in carfare is
| that each Of the two car companies Is
earning less than this fair" return.
although neither petitioner has stated
what it considers "fair" return.
| The Capital Traction Co. stated that
it was earning a rate OF $50 per cent
upon its valuation. and the Washing
! ton Railway & Electric Co. claimed
to be earning All per cent upon its
/ valuation. Should there be substantial
error in the calculating Of either the
valuation or the amount set up as in
come available for return on fair value"
or In both, 1t might we'll be that the
companies are in better shape f1nan-
cielly than the record thus far dis
| closes.
Hundreds Of Questions.
Literally hundreds Of questions have
been aimed at these two considerations,
directly and indirectly. by Commissioner
Hartman. While it is impossible TO
estimate the difference that the vari-
Gus results of those questions have made
or might make in the companies fig
ures, should this difference prove large
enough the commission might we'll de-
cided to revalue before changing the
| rates.
Any such decision as this, it is nearly
certain, would be taken to the courts.
In the long delay that probably would
follow. many things might happen.
Transportation conditions might adjust
themselves to new levels instead Of be-
coming increasingly difficult, as they
have been doing since 1920, when the
curve of passengers carried began to
fall off, Perhaps more important than
this, the companies might merge, CIV
ing Washington what has been sought
for many years, q single street car sys-
tenn, with its supplementary bus serv-
ices, all operating at a uniform rate OF
fare and with free intercommunicating
| transfers.
Members of the Public Utilities Com
mission steadily have pounded away on
the question of either complete corpo-
rate merger or else joint operation OF
street car facilities without actual
merger. The companies witnesses,
with equal steadiness. have resisted all
efforts to get away from the single sub
ject Of higher fares. The commission
several times has pointed out that there
seems to be an agreement In the testi-
mony offered by the companies in pre-
vious cases that savings could be made
through merger, and has asked why
, savings would not also be the result of
| Joint operation.
Say Group Lacks Power.
The companies have replied that as
| to merger, 1t is useless to talk about 1t
since the commission has no power to
authorize one. This power rests in
| Congress. AS to joint operation, the
companies do not favor 1t, except in q
few small stretches Of track near the
Union Station, the Capitol and on
| Florida avenue, where 1t Is already In
effect.
The companies maintain that the
commission has no power to order joint
operation, except in such cases as the
companies agree to it, as the result Of
such an order would be virtually the
same as that Of a merger, which only
| Congress can authorize.
The hearings Tuesday will start with
consideration of the application Of the
Washington Interurban Railway Co.,
! subsidiary of the Washington Rail-
way g. Electric Co.. for the same rate
| of fare as that sought by the street
car companies-1O cents cash,
! tokens for 80 cents. The company
operates a bus line from Fifteenth and
| II streets northeast to Cheverly, East
Riverdale, and College Park, Md. The
present rates are the same as those in
effect on the street cars within the
District Of Columbia-8 cents cash. 6
tokens for 40 cents. The company
| claims to have lost money steadily
since May, 1923, except for one month,
| when 1t reported earnings Of $40.
Following the interurban case, there
| will be testimony on behalf OF the
| Washington Rapid Transit Co., an in
dependent concern which operates the
Sixteenth street bus lines and others.
That will complete the Affirmative testi-
mony on the part of the carriers, all
though they may have some other
testimony to offer in rebuttal.