Evening star., 1950-05-03
Transit Heariinq
Exp|oresGapin
Fare Estimates
PUG Top Accountant
And Company Official
81 Million Apart

~ MILLION Apart
The Capital Transit Co. fare
increase hearing today was ex-
ploring the reasons why two ex-
perts were nearly 81 million apart
In estimating the return to the
company from the increased fares
recommended by the Public Utili-
ties Commissions top accountant.
]. E. Heberle, company con-
troller. was to be croSs-examined
today by Lloyd B. Harrison, COM
mission counsel, on figures he gave
in attacking estimates by V. A..
McElfresh. executive accountant
for the commission. The hearing
before the commission In the Dis
trict Building may end today.
Mr.. McElfresh has estimated
the fares he recommended-15
cents cash, tokens at 1919 cents
sold in patches of four and $2.25
weekly pass-would give the COM
pany passenger revenue of $685.
150,220. He estimated the net
operating income at $1,849, ,692, or
a return at the rate of 6.72 per
cent on the value of the property
the company uses in its District
operations.
Heberle'S Estimates.
Mr.. Heberle'S estimates of the
results of Mr.. McElfreSh's fare
recommendations were much low
er. He testified in rebuttal that the
passenger revenue would be $25,-
662 COS. He put the net operating
income at $868,907. or a 3.16 per
cent return. The commission has
held that a 71z per cent return
would be reasonable.
The difference between Mr..
McElfresh's and Mr.. Heberle's
figures for the net income is just
$l9,215 short of 81 million.
The two experts, it should be
pointed out, used slightly different
periods for their estimates. Mr..
McElfresh's computations were for
the IL months ending May 81,
1851: Mr. Heberle's, for the IL
months ending February %, 1851.
The two differ. but not so widely,
on the result of the fares for
which the company is petitioning
-15 cents cash. tokens at 1873
cents in patches of six for 80 cents,
and no pass.
Maryland Phase Challenged.
Mr.. McElfresh has estimated
these fares would yield the COM
pany a net of $2,448.758, or an
8.9 per cent return. Mr.. Heberle
has put the return at $1,959,879,
or IL per cent.
Both computations are no the
basis Of District operations alone.
But Mr.. Heberle, in rebuttal teSti-
mony, challenged Mr.. McElfresh's1
figures in allocating certain system
expenses to Maryland operations,
rather than to District operations
and to dismissing cartain other
expenses which Mr.. Heberle said
should have been counted by Mr..
McElfresh in his estimates.
The total of such errors Mr..
Heberle said the commission ac-
countant made amounted to $780,
297. OF this total Mr.. Heberle
took specific items amounting to
$349.423, which he said should be
charged against District opera
tions. but which Mr.. McElfresh
did not do. Mr.. Heberle said that.
II company income were reduced
by this amount under Mr.. McEl-
freSh's fare recommendations, the
net income after taxes would be
reduced by $205,810, or three
fourthS of l per cent.
Mr.. McElfresh estimated that,
on top of a 16 per cent annual
decline in the number of pass
purchasers. raising the price from
SITS, the present figure, to 1925
would mean shift of 20 per cent
OF pass purchasers to cash or
token fares at the rate of IL rides
o week.
MIR. Heberle, assuming a 6 per
cent decline in traffic, estimated
SO per cent of the pass pur-
chasers would switch to other
fares at the rate of IA rides a
week.
Transfer Charge Proposed.
A different solution to the COM
pany's financial troubles came
yesterday from A. L. Pierce, life
insurance salesman, of 507 Third
street Sc. He took the stand to
say that. instead of buying a pass,
"a person. If forced to do so and
dishonest enough to do so, can
travel far cheaper by paying the
cash fare and using a transfer" B"
He contended that operators of
cars and buses do not inspect the
transfers and that a passenger, by
waving his transfer at the opera
tor and saying he wants to use
the transfer again, can ride all
over town on the one transfer. He
said that several years ago, with
q pass in his pocket, as test he
paid the cash fare, obtained a
transfer and rode from 1870 pm
to Gas pm. unchallenged.
Mr.. Pierce recommended a 10
cent fare with charge of 5 cents
for a transfer. He conceded the
company has frightened up on the
use of transfers, "but not much.'
He said he rides from 8 to 10
times a dav on his mass