Evening star., 1955-09-04

tributahle to the strike period
To this I add:
One-hundred thousand dollars
estimated increase In advertising
The company now
rents car-card space to Philbine
81 Coine, under circumstances
which have been questioned and
require explanation. Revenues
from station and vehicle priv
ileges. principally derived from
ar-card advertising revenues
have declined from 9247,267 In
1852 (under contract with q
prior advertising agent) to $751;
721 in 1854.
12-months period. and an addi-
dollars estimated increase In
school fare revenues. This Ii
based. on an increase under the
provisions Of Public Law 32C
from 3 cents to 71a cents.
Seventy thousand dollars es-
timated increase In MARYLAND
Zone . fares, raised from present
7-cent rate to 10 cents. Maryland
operations are conducted at Q
large loss.
My estimate OF operating rev.
enues from the prior fare struc-
ture thus becomes $24,621 .099.
Excludes Strike Losses
Over and above normal de-
cline" there is another adverse
factor which will affect the com.
pany's passenger revenues in the
future period. This is the los:
of traffic attributable to the So.
day service stoppage beginning
July l. 1855, calculated to reduce
passenger revenues by go, Of
$710,002. In computing the rev.
enues from economical and eff
cient operation, / have haC
serious doubts whether or not ts
apply this reduction on the fact.
of the present case, and tC
charge future transit riders witt
Capital Transit's revenue losse!
due to the strike.
In my opinion, such a charge
is proper in case a utility, sin.
cerely interested in continuing
Ito operate with maximum econ.
omy, Is subjected to a strike fol
Increased wages. Labor relations
should be the exclusive preroga'
tive Of utility management
whose actions In respect Of labol
negotiations. however inept
should not be the subject O.
Commission interference. How
ever. these principles do no
apply where the interest Of tn,
utility is not in operation Of tn
business, but in liquidation, ant
when the strike in question ap
pears to have been prolonged, i
not provoked. as part of a gen
ieral plan to cease operations al
together. There is considerabl,
evidence that these principles
therefore, do not apply to Capi
tai Transit Company's recen
service stoppage; and that tn,
stockholders. rather than tn
transit riders, should pay tn,
costs and revenue loss attribut
able to the strike.
Evidence Of the overall liqui
.dation plan exists in the state
ments of management. begin
ming with published speech o
the company's president on Feb
ruary 26, 1852, and continuing
through statements Of the boart
chairman before the Payne Com
mittee and elsewhere in tn
spring of 1854. These statement
hinge continued operations o
Capital Transit tas a privatl
businessl on a guaranteed ~
iper cent return on the origina
cost Of its properties.
Evidence to the same effec
exists in the overt actions o
management in stripping tn
Icompany's cash and availabl
physical assets for dividends
failure to provide for replace
Iment of worn out vehicles; an,
refusing to provide for bus con
version and other moderhiza
tion.
Failure to provide for reason
able settlement of the labor dis
pute which at all times impendet
as of the termination of tn,
Union contract July /, 1865, ma,
we'll have been another aspect O
management's liquidation policy
conclude that there ar
strong indications that the wor
stoppage was actually engineere,
by company management. Tn
union has so charged, and
prepared to so testify. Their
are no contra indications sue
as, for examples, any statemen
of sensible reasons for the refu
sal to arbitrate. However, tn
evidence is not so clear as to con
vict the company Of such a seri
Gus charge as that of deliberatel
provoking a strike in utility op
erations, absent full opportunit
Of the company to be heard o,
the charge. I, therefore, deduc
$710.002 permanent loss of traf
fic from the $24,621,099 esti
mated future revenues which tn
company would have receive
from the prior fare structure
leaving a balance of $23,9l1,09
properly included in this account
Bus Conversion Urged
=. 1t is perfectly clear
that conversion to all-bus oper
ations would have reduced tn
$23, sol ,002 operating expense
and depreciation incurred by tn
company for the II month
ended April 80, 1855. by approx
mately $2.900.000. In the year
that have passed since this com