Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-06-26
Conferees Set
To Hear Offers
Tomorrow
BY HECTOR MCLEAN

S@NeA SONuJ VA NAAO SNC Va -
meeting at 2:30 pm. tomorrow
of House and Senate confefees.
Representatives of National
City Lines, Inc, Nationwide
transit holding company, which
has a contract to buy out Cap
ital Transit Co., were visiting
lawmakers on Capitol Hill and
outlining bargaining compro-
misses in their demands for fran
chise terms.
o. Roy Chalk, wealthy New
York real estate owner and pres
ident of Trans-Caribbean Air
ways. Inc. was in New York to
consult with officials of the
Chase Manhattan Bank on a
financial decision" which he
said might solve the transit
crisis.
Compromise on Earnings
B. w. Franklin, vice president
of National City Lines, said his
firm is willing to reduce from
10 per cent to 8 per cent the
earnings National City wants
written into a congressional
franchise.
Also, he said, National City
us discussing local application Of
the formula by which the Chi
Icago Transit Authority pays the
city when it abandons streetcar
lines and turns them over to the
city.
In National City's contract
with Capital Transit, NCL asked
for relief from the cost of tear
ing up streetcar tracks and re-
paving the streets. Mr.. Frank
lin said that, in Chicago, when
the transit authority apandons
streetcar lines, it gives them to
the city. Later, when the city
Irepaves the street it paves over
the OLD tracks. At that time.
he said. the authority pays the
city $4,000 per single track mile.
Estimates Payment Here
Mr.. Franklin said that, under
/ this formula, the proposed OPP
lerating company National City
would set up would pay to the
District between 100000 and
$75O,000.
Mr.. Franklin said that, in con-
ferring with the District Com
miSSionerS last Tuesday the
company's request for 10 per cent
earnings on gross operating rev.
lenues never got to the bargain
ing stage. He said the Commits
Sioners opposed any restriction
on the Public Utilities Commits
sion's right to set the earnings
| figure as a matter of principle.
Later, the Commissioners
agreed to see a figure of 612 per
cent written into law as a state
ment of current fair earnings.
Mr.. Franklin also said Ma
tional City Lines is willing to
exclude from the operating ex-
lpenses in calculating earnings
some of the interest 1t must pay
on its loans.
Chalk To See Banker
Mr.. Chalk returned to New
York last night after a day OF
conference with lawmakers and
an evening session with the Dis
trict Commissioners. He said he
would confer with bank officials
and make a financial decision
which might win control of Cap
ital Transit for him and Morris
Fox, president of a local truck
ing company.
The National City Lines con-
tract with CTC calls for a total
price of $13.440,O00, with half
paid down and the other half
spread over Is years.
Mr.. Chalk has offered the
company the same total price
with So million dow2 and the
balance spread over Is years.
The Capital Transit board Of
directors will meet on Thurs
day for its regular monthly
session and will have before it
the contract signed by National
City Lines, with an accompany
ing check for S250,000, and the
offer of Mr.. Chalk, with sight
draft of 100000.
Conditional Offer
The National City Lines deal
lis conditioned on approval by
Congress Of a franchise satisfac-
tory to mel and on approval by
holders of two thirds of etc
stock.
Observers have pointed out
that, If House and Senate con-
lferees. meeting tomorrow for the
second time since they first con-
vened on May %, indicate I'M
Willingness to accept the National
City Lines franchise terms. it
could wreck the mel deal and
leave the board Of directors free
to look for another buyer.
The District Commissioners
last week said all proposals were
unacceptable and called for
public ownership. Shortly there
after. however, they notified
Congress they we're satisfied
with franchise terms requested
by a group headed by Harry A.
Mcdonald, former head of the
Securities and Exchange Com
mission and Of the Reconstruct
ton Finance Corp. under
President Truman.
Mr.. Mcdonald proposes that
Capital Transit Co. buy out and
retire the stock Of its controlling
shareholder. Louis Z. Wolfson.
His group proposes it be given
an option to buy UP to 10000
shares Of etc stock at the Sl4
price offered by all would-be
buyers and would guarantee to
buy up TO 10000 shares II stock
holders other than Mr.. Wolfson
wanted TO unload at the Sla
lprice.