Evening star., 1951-07-31
Another Question of 'ReosonobIeness'

The financial picture which the Capital
Transit Company has presented to the Public
Utilities Commission in support of increased
fares is far different from that envisioned by its
patrons as result of recent optimistic reports
on the companyS earnings The companyS re-
quest for straight 15-cent fare and 25-cent
increase in the weekly pass rate therefore should
be scrutinzed by the PUG for ''reasonabeness"
with as much as is being given questions OF
services and safety in current hearings
The company's petition contains disturbing
figures on the estimated rise in operating costs
during the ensuing fiscal year The wage in
creases and other benefits granted hourly rated
employees after the short-lived strike earlier this
month"; plus increases previously granted salaried
employees, will add more than SIT million to
operating costs during the year, according to the
company. It's power bill will be increased $2260O0
a year under a PUCapproved electric rate as
SesSment. Other expenses will push the total
extra cost of operation to around 81 million for
the year, it is estimated.
Unless fares are raised the utility states, its
overall earnings during the fiscal year ending
June 80 next will be 81 million short Of the
minimum 712 per cent return which the PUG has
established as necessary to preserve the financial
stability of the company. It's earnings inside
the District will fall $675, 900 short of the mini
mum fair return. The proposed elimination OF
tokens in favor of a 15-cent cash fare and
more expensive weekly pass is designed to fill
the gap.
What effect an increased price for the pass
would have on sales of the unlimited-trip tickets
is hard to guess When the pass was raised from
SITS to 50 in 1948 it was predicted by some
critics of the boost that there would be a drastic
drop IN number of pass users. There was fall
off uyhi1e hl1t rncentlv the sales Of
passes have risen to around $4,000 or 10000
week. This provides a substantial backlog of
regular riders who, 1t is estimated take an aver
age Of Is rides week. This rate of usage means
a fare of about 1914 cents for each trip. The
proposed charge of $225 would raise the figure
to the level of the requested cash fare. To such
average users therefore, the only advantage OF
the pass would be it's convenience. 1t dispenses
with pocket-Searching for dimes and nickels,
a time-conSuming operation that tends to slow
up loading of vehicles However, there are many
pass buyers who take far more than Is trips
a week, according to the PUG. They would still
be saving money under the higher price for
passes
Filing of the petition for a revised fare
schedule was we'll timed from Capital TransitS
standpoint. The depressing financial outlook
was laid before the PUG just as it began hearings
on the adequacy and reasonableness of the COM
panys services The effect was to Offset glowing
reports of booming earnings-reportS that had
given rise to fears that the company was sacri-
f1cng service, maintenance and safety to profits.
The hearings on service thus are being held
against background of impending deficits in
stead of aff1uence. An economy program to
reduce losses is more easily justified than one
to increase profits Certainly there is justif1ca
ton for prudent economy at any time. 1t is
the tough job of the PUG to determine whether
Capital Transits economies have been prudent
and whether in any event, higher fares are
necessary to keep the company on an even keel.
Be itoreduced service or higher fares it is the
riding public, as usual that feels the pinch.