Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-03-26
CIVIC LEADER HITS
TAXREDUCT|ONFOR
TRACTION FIRMS
Clayton Argues Companies
Pay No Franchise for Use
of Public Thoroughfares.
HANNA CLAIMS LEVY
ON EARNINGS is FEE
Federation Representative Presents
Three Amendments to Pro-
posed Merger Bill.

The suggestion of Chairman Mason
M. Patrick of the Public Utilities Com
mission that the tax levy against the
street railway companies be reduced
in return for establishment of reduced
fares for school children was assailed
last night by William NICK. Clayton,
representing the Federation Of Cit
liens Associations, at the hearing of
the railway merger bill before the House
District subcommittee.
The civic leader argued that the
traction companies pay no franchise for
using the public thoroughfares, and as
serted they were taxed lightly at pres
ent. To further reduce their taxes, he
said, would be unfair to the other tax
payers.
Hanna Answers Clayton.
John H. Hanna, president of the
Capital Traction Co., answered Mr..
Clayton with the contention that the
companies do pay franchise tax, In
addition to the regular real estate tax.
He declared the 4 per cent tax levied
on the gross earnings of the companies
constitutes franchise fee. While not
opposing the fare reduction plan for
school children, Mr.. Hanna vigorously
opposed making the traction companies
bear the burden, claiming that their
earnings now are low.
Mr.. Clayton presented to the SUBJ
committee three amendments to the
merger bill proposed by the federation.
One would give the Public Utilities
Commission the right to approve
articles of incorporation of the merged
company, second would not only au-
thoriZe but direct the Utilities Com
mission to give reduced fares to stu
dents, and the third would provide free
transfers not alone between street cars
but between cars and buses and be-
tween buses.
Mr.. Hanna, the only other witness
to testify last night, approved the
amendment giving the Utilities Com
mission authority to approve the in
corporation papers, but he opposed the
other two recommendations. To direct
members of the commission to institute
reduced school fares, he said, would be
unfair to the commission, restricting
them in the exercise of their rate
making powers. The commission should
be allowed to use its own good judg-
ment as to the amount of the reduc-
ton and to whom it should be extend
ed, he stated.
Explains Bus Transfer.
Buses were specifically eliminated
from the free transfer plan of the bill,
the company head explained, because
of the varying rates of fare on the bus
lines. 1t would be unfair, he said, to
give a street car passenger, who pays
cents, a free transfer to one of the
de luxe bus lines, on which the fare is IS
cents, or to lines where the fare is 10
cents. Mr.. Clayton interiected that
mr. inf IN iVia ltfro
the de luxe lines.
In response to a question by Acting
Chairman Bowman of West Virginia,
Mr.. Hanna estimated the eventual saw
ings to be realized from the merger at
half a million dollars a year. The
costs of revaluation and rerouting dur
ing the first year or two of operation
would reduce this saving to about
$4,000, he thought
What hope does the merger hold out
for cheaper fares?" the chairman in
quired.
None whatever, in my opinion" Mr..
Hanna replied. ION the contrary, I
think the companies are not getting
enough fare now. and that eventually
the fare will have to be raised. I see
no possibility of any reduction at ALL
Then just what will the car riders
the strap-hangers-get out of this mer-
ger?" Mr.. Bowman asked.
They will get improved service.
more comfortable equipment, free
transfers, better routes" the traction
official said
will there be seat for every pas
senger?"
IT don't think that is possible here
or anywhere else" the witness de-
clared. 1.-The public is not willing to
pev for it,
The hearing will be continued to-
morrow morning at 10 O'Clock.