Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-01-26
$40 Million
u. S. Loan
Is Sought
BY HECTOR MCLEAN

The District commissioners
day sent to Congress their bill
to set up a Washington Metro
Ipolitan Transit Authority to take
over the streetcar and bus sys-
tenn here next August.
There was momentary hesita-
ton as to which member of the
District Committee might intro
duce the bill in the Senate, or
when. This was attributed to
the fact that the bill would
make employees of the authority
subject to the Federal law which
makes it a crime to strike against
Government agencies
The highlight Of the measure
was disclosure that the Treas
ury Department has forced a
change in plans for financing
the authority to get it started
when the Capital Transit Co.
dies by act Of Congress next
August IA.
| Originally. the Commissioners
had proposed to let the authority
borrow $40 million directly from
the Treasury. The new draft.
however, would let the District
Commissioners themselves bor-
row $40 million from the Treas
ury and lend it to the authority.
Stop Gap Borrowing
This would tide the authority
over until it could borrow direct
lily from the public by selling tax
free bonds to be paid out Of
revenues from its fare boxes.
! The new measure also aban-
doned any idea of "appropri-
iating" $250,000 to pay lawyers,
experts and consultants TO neip
plan the setup of the authority.
The Treasury loans would be
made out of the proceeds of the
sale of any securities issued
under the Second Liberty Bond
Act" repeatedly the only United
States debt issue not covered by
the Federal debt ceiling
| OF the new loan provision.
Commissioner Samuel Spencer
told Chairman Nicely of the Sem
ate District Committee. Section
27 of the enclosed bill, which has
ito do with the interim financing
lof the authority by a Federal
loan. has been submitted to the
Bureau of the Budget and the
Commissioners have been in
formed that the bureau has no
objection to that section as
presently drafted"
/ Recall December Note
| Senator Nicely said that "at
the first opportunity I will read
the bill, and will act appropri-
ately just as quickly as possible"
! In the letter of transmittal,
Mr.. Spencer reminded the Dis
Itrict Committee chairmen that
the Commissioners last Deem
Der 80 had advised them of the
Districts inability to find a quail
iified private operator. At that
time they told the lawmakers
they were preparing legislation
for transit authority.
The Commissioners noted that
the Public Utilities Commission
had Joined them in drafting and
recommending the authority
bill. They said they had assist
ance from Portland Merrill and
Walter Cleave of Blyth & Co..
bankers, and John Mitchell. at
torney, of the firm of Caldwell.
Marshall, Trimble g. Mitchell Of
New York City.
Seek Broad Powers
Describing the provisions of
the measure, Commissioner
Spencer said:
THE authority is granted
broad powers to create and man.
age an effective transportation
system in accordance with sound
business practices. 1t is ex-
empted from laws and regula-
tons which are designed for
normal governmental functions.
but are too restrictive for an
Operation of this kind.
In carrying out its duties
the authority would be granted
the power of eminent domain
See TRANSIT, Page "A