Evening star., 1961-01-23
Transit Fares


further Improvements and to institute
an "austerity program" in the D. c.
Transit System. This, in the present
climate Of our transportation dilemma,
is precisely the opposite of what is
needed to stimulate transit patronage,
and we hope that Mr.. Chalk Is only
letting OF a bit Of steam.
Mr.. Chalk insists that he needs more
cash-through fare raise-to continue
the commendable improvements already
begun and to gain fair financial return.
The essence Of the Public Utilities Com
mission decision is that this is not so,
that in fact he has sufficient cash, and
that an extension Of the period Of bus
depreciation from IA to II years will
provide him-for the immediate future
at least-with net operating income
adequate to meet its requirements and to
assure fair profit in terms Of both
dollar-amount and percentage rate-of-
return.
Mr.. Chalk argues, and correctly so,
that spreading the bus depreciation
allowance over longer period will not
really increase the total amount of cash
he has to work with. It will not, for
example, as Mr.. Chalk seems to want,
provide him with the dollars that are
needed to buy new buses. It seems to us
that the P. U. c. is on Arm ground, how
ever, in holding that this is not an
expense, which legitimately should be
met through fare increases. The pur-
chase Of new buses is a capital invest
ment, which D. C.sTranSit should finance
through long-term indebtedness or the
issuance Of stock, and for which 1t should
be reimbursed through depreciation
allowances over the life-span Of the
buses.
In one ironic sense, the lengthening
OF the depreciation period Is a penalty
imposed upon D. C. Transit as the result
Of its excellent maintenance program,
which has kept buses In running order
for longer periods than in most cities.
And at first glance, this seems unfair.
In justice to the P. U. c., however, the
II years is not an arbitrary figure; 1t is
based on the actual use of D. C. Transit
buses, about a third Of which, according
to commission records, are more than
Is years old. Apparently there is no
dispute that the annual depreciation
allowances have been higher than If
they were geared to the actual life of the
buses, and it is only common sense that
this should be corrected.
There is weakness in the P. U. c.
decision, nevertheless, which would seem
to justify another review in the near
future If one IS sought by the transit
company. The weakness Is that the COM
mission finding Of fair net operating
income for the year ending February
% was based on actual company ex-
perience for only the six-month period
which ended last August 81, and this
is short time in which to evaluate the
effects Of the street car-to-bus con-
version and the fare raise which took
place year ago. II the need for addi-
tional revenues is shown by a broader
study, they should be provided.
When and If this is decided, how
ever, we believe the new revenues should
come from some sources other than high
er fares, which only can lead to a con-
tinuing spiral Of fewer passengers and
more financial problems. One plausible
source, as Mr.. Chalk suggests, would be
for Congress to rescind the unrealistic
10-cent maximum fare for school chill
dren-an indirect subsidy which now
Is borne unfairly by all other transit
riders. Perhaps Congress could grant
the P. U. c. standby authority to
increase school fares, and possibly
grant other forms Of relief, when it is
warranted.