Evening Star Newspaper, February 15, 1928, Page 4

‘TRACTION MERGER PLANS PRESENTED Agreement Places Valuation { at $25.400.000 for New : Transit Company. | | 1 ! | { | Page.) service first class in all respects and price with o ¢ the high | the atton { transpo: only flow e highest pos- service with | The agreement by which the Capital Traction, the Washington ‘Rall- way & Flectric and the Washington enter into & voluntary operating and Ownership and control by a new company, tal Transit Co. of all the transit properties, ins companics. with a total capitalization of $52.400.- 400,000 would be provided by the present companies, to be available for making track and other changes and for working capital, on which it “shall be entitled to carn & return of 7 per cent.” Liquidation and dissolution of the Capital Traction Co. through an trict, of the three utility 000. of which 2. exchange of stock. Purc] within the District. Transfers bet terms and conditions prescribed by the Public Utilities Commis shington Railvay & Electric Co., al- Continued existence of the W. though not as an operating company’ all of the outstanding stock of the fhdertake to enter into a power arrangement with the new company. and | | take over all existing contracts of the railway company for the sale of power to other TailWAy companics | Creation of a board of directors of 15 members. to manage and i company. 6 of whom are to represent the Capital Trac- | on Railway & Electric Co. and 3 to represent the | | operate the new ase and absorption of the new cempany of the Washington Rapid Transit Co.. the purchase price to be $596.000. Free transfers to anv connecting point of the new company’s lincs THE EVENING STAR. WASHINGTON, D. C., TRANSIT UNIFICATION PLAN PROVIDES 7 PER CENT RETURN Rapid Transit companies propose to financial consolidation, provides: to be known as the Capi- ide and outside of the Dis- | | ween street cars and busses under | | jon | This company. which now owns | Potomac Electric Power Co., would | | consolidated company shall be designat- Constitution of the United States, as expressed in Innumerable decisions by courts of last resort. Obvlmlslf'. there- fore, this feature of my original sugges- tion had to be abandoned. People Are Represented. “As a partial substitute therefor the companics have agreed that three of the board of directors of the new or ed by proper District offictals to rep- resent the public. This means that in addition _to the regulation and supe vision which will continue to be cxe cised by the Public Utilities Commissic: as at present, the interests of the public will be safeguarded on the hoard of di- rectors itself, and that as a resul there- of the board will be responsive to nublic opinion. I naturally assume that. all or practically all of the remaining directors 1o be elected by the stockholders will be residents of Washington, and therefore | 1t appears certain that the management of the unified company will be anxious at all times to work for the best in- terests of the National Capital. This agreement to have three public directors | I consider & very real advance as assul g & policy of ‘the public be please Valuation at $50,000,000. “Applying the ot e & v ot Colum of Jun w b (RETRIT v ad- December L RN0.000 7 5,234,100 we o wame date i R LT “Including property additions during 1927 and the Washinglon Rapid Transit Co. will undoubtedly bring the valua- ton to over $62,500,000. Cut of $12,000, “It is, therefore, with a feeling of no tion Co.. 6 the Washin The public representatives would be appointed by the Public b3 g “tilities Commission Valuation.— his, as Is usual in such cases, hes (hat after weeks of discussion the direct- ilittle pride that I am able to report he ors of the Capital Traction Co. and the WEDNESDAY., FEBRUARY 15, 1928. interstate in character and it tppnnl to the owners and pre-eminently to t clear that Congress has the authority | advantage o 8 It e ’;"‘”nd v}lll:miul‘ildlfih’n ‘gf | age of the public. Commission. Ington is rapldly ex- | ton merger hist:z,. It may be entirely | cause which appeal lpl‘l:al;‘u's‘ :‘m‘bfin b:be. c‘:‘:f::n r;lylw'l‘):: g;fl;l?;:x :hn.s:nmtl ‘crmelsm of the plan | of it. and ecadae xe?e: that .l'c::n 5'.1 S Y ) . me Interests may prefer | public something for the erous - unified company operate both in Mary- | changes in detail, if not in actual prin- | port it has M:ordr,d men::: my ?r::l land and Washington. The District ciple; some poi; y Tine s & totally artificial barrier 5o far | of some one” nas mn orerie o |y game - Comiact with the public As street rallway and bus transportation | others may wish to insert this and that. | is concerned. and should be eliminated | These things are the normal expectancy | karews avaae oy ! w: FRANK G. COLLINS DIES AT AGE OF 76 80 far as possible. | in matters of this sort, because no great | forward movement can be framed by Chief of Division of Paper Custody Served Federal Government Commission Ts Lauded. | human intelligence to meet 100 per | 54 Years. other plans purely personal in chare acter. My work, poor and 'humble as it has been, is freely offered to & hei 1t s also the one and only agreed plan in Washin “For the greater convenience perhaps, | cent of of your commission there is appended | “The bl Toa T e 1mporm-! hereto & brief summary of the other | 1ons it ‘may bear, nonetheless repre- points involved in this proposed trans- | ?gcu an honest effort to pave the way | action. As my study of the problem, | (i Ganslt service in this. our Na- Initiated one vear ago, became more | wine CAPIAl second to nome any- | extensive and more intensive I realized | 1050 and better than in the xrmi the very grave complexities Involved in | [y ors, Of American cities. It merits | any attempt at merger. Having once | 1 had ICSPeCt your hearty support | concluded, however, that full, free and | worqee? A PrOmptly and free frank discussion would tend to clear | ““"4°% away much, if not all, of the obstructive | debris, I appealed to your body for | assistance in bringing about the de- sirsd contacts and the necessary con- ferences with those primarily in inter- | est. ‘Thanks to your prompt. energetic and wholehearted co-operation. I was cnabled to proceed with the business | in an orderly fashion. “It is doubtless true that your own patience and that of the public has N P e Gt Frank G. Collins, 76 years old, chief “In conclusion, may I again point °f the civision of paper custody of the out my individual interest in the mat- Public debt service, Treasury Depa “;]r, r,lhmp,.” as owner of practically | Mnt. died this morning of heart trou- all of the outstanding stock of Wash- | ble at his home. 1413 Hopkins street ington Rapid Transit Co. As promised | Mr. Collins, who was born fn Man- by me at the time of my acquisition .. of this stock (solcly in the intorest of COSter. N. H. had served the Govern- a merger) I have become party to an Ment for 54 years, many of which had agreement which returns me not a | been in his last post. where he was A reasonable guarantee to the new company against competition. [ proved the most difficult problem in t been not a little strained by prolonga- | <ingle dollar of profit in return for the rocponcible for every sheet of paper out resuits, is corre- osts of Public Rights Paramount. undamental ased the more than for merger in Wash- nd is sound in st be admitted nployed to accomplish a_result’ been principl ¢ and upon orderly processes. if bound to Iy their own usefulness. 2 mers and public alike | a mutuality of interest and ¢ co-ordinated effort toward the the greatest good to the bicker: and misun- 0 the useless ¥ tory of mer- here discloses the fact that ance the blame for upon the shoulders | rs of the transit properties 1e public. The owners have stead- stood upon their legal rights. as ¢ governing bodies and the le certain overzealous and | perienced citizens have exhibited a | to disregard established busi- | inciples totally with tes made and provided for just | guch cases. Too often has the wish been father to the thought in the formula- and fantastic schem ir purpose the establist ment of a panacea for all ilis, real and | tmeginary. i TUrges Mutual Understanding. it has been found on care- that differences existing be- | e utility operators and the | Ppublic they serve are largely a state of mind, rather than something of subd- possible of reconciliation. Too a mistaken idea as to the importance of divergent views secking a common end. Human nature is a complex problem and the man long | sccustomed 1o doing a particular thing | ¥ experiences a grad- | ng of vision when other g the same thing are sug- gested o h An element of tradition and preiudice invariabl: matters of this sort. and it is only by the exercise of a maximum of patience and suasion that elimination of that el ment can be accomplished. and it is only by such accomplishment that the decks can be cleared for calm and dispassio: ste consideration of the mare important | feature of bringing into closer harmony | 8ll expressed opinions and narrowing the po3 of di “In view of the past corresponéence and discussions which I have had with the commission on the subject of the 1 think 1 should make clear m tude regarding the present | weird for wars of dod Early Steps Recalled. “The prolonged negotiations between ttees representing the direc two street rallway com- | myself which have resuited | agreement were in- | of the letter which r 8, 1927. 10 Presi- - Capital Traction Co., 1 of the Washington | Co. and o mysel! t ‘this comm'ssion hat a merger the consum- | You 0. 2nd the Washing- Electric Co. 1o armi ! be acceptable 1o & ituatio general ation of out- the 1 promote the pub- [s It is not necessary to have had an Ac- count at this Bank to Borrow, MOEKIS > stioe gusranteed Uy a 3300 $25.00 $360 $50.00 $540 $45.00 $1,200 $100.00 $6,000 $500.00 THE MORRIS PLAN BANK | Unter Supervision U. 8. Treaswry 1408 } STREET, N. W. | readjustment of the service {the law as it at present exist Removal of the present assessments for raliway crossing policemen, the laying of new pavements and repairs to stree To improve serv Purposes of the merger: use the economic loss now resulting esthetic and economic development adequate protection to the owners of and bridees. convert into beneficial g in multiple operation. aid in the of the National Capltal and provide | the properties. - previously. primary purpose of a unification of the transit properties of Washington and of the metropolitan area should be to: 1. Improve the servic 2. Convert into ben al economic loss now resulting multiple operation: 3. Aid in the esth opment of the nd 4. Provide adequate protection to the owners of the properties “1 believe that the unification agree- ment as presented will go far toward meeting these requirements. Important Elements Cited. “Provisions for free and street car transfers and use the through tic and economic Nation'’s Capital, universal promulgate: unified operation of the en- tire system of transportation and pub- lic representation on the board of di- rectors. together with all necessary and useful rearrangement of trackage end in con- formity therewith are elements so clear- |1y in public interest as in themselves to fully justify the proposed unification. | ‘May 1 be permitted to emphasize the following points: “1. Regulation and Control.—In the plan previously suggested the opinion was expressed that not only the transit properties should be unified. Rut that conditions in the National Capital were so unique that a publicly appointed body should have complete control over the present and future arrangement of the tracks and over the operation of the street railw and busses. Under and in- deed under any law adopted without my conviction that the ! interuse of | i street cars and busses. under such rules | and regulations as your commission may the prior consent of the present own- ers, no additions and betterments can | be ordered which do not promise to be | compensatory. and no frack changes can | | bs directed which would interfere with ths earning ability of the companies as 1 understand it. Farly 1dea Dropped. “I. therefore, suggested that the re-, arrangement of the properties and their | operation should be under the control | of a body of three trustees similar to that now operating successfully in Bos- ton. “As a proper and necessary consider lation to the owners for surrendering| such control and permitting the rear: rangement of their properties withoat regard to earnings, my plan provided | for & guaranteed return above operating expenses on an original rate base ‘(' 50.000.000. | “As the discussions with the com- panies progressed it became increasing- Iy evident that this feature would mcet with insurmountable disfavor. The companies expressed themselves as he- lleving that their past stewardship had not been of a character to suggest in- ‘rusting the management to new and antried experimentation. even *hough it | might be found feasible through appro- priate legislative enactment to guar- | antee them such return. They appeared | {to find abhorrence in any suggestion | that the future of thelr nroperties | lacked sufficient promise to justify | continuzsnce of their own responsi li5~| ties. They had very confident expecta- tions of a fair and reasonable re‘urn! through their own efforts. In short. they want nothing more than the rigat to earn a fair return on th> value of thelr properties as assured them by, the | 1 | | | negotiations. ~ While it is true | pointed out by the companics) that my | original valuation of all the transit properties within the metropolitan | area of the District of $50,000.000 car- | ied with it_a guarantced return of 7| per cent. I saw insufficient rea through mere alteration of the plan, to make any change in that figure. I! freely admit that the figure was based upon the cquities of the situation, rather than upon the usual formula | applying in such cases, but being firm- | v convinced that unless usual formu- | las could be abandoned in favor of a fair spirit of give and take, no merger | would ever be agreed upon, I stuck dili- gently to the arguments employed in the former case and insisted upon fifty millions as the depreciated value of the physical properties for rate-making purposes. “In all fairness it must be admitted | that the companies, from a strictly ! legal standpoint. are entitled to a rate | base vaiue far in excess of this sum, | as the following figures will clearly in- | dicate. 1 believe, however. that no higher figure is feasible in the circum- | stances and as a major concession to | the obfect sought. the companies finally | conceded the point | panies did 5o in a spirit of further con- | 0o REREURTT (as | Washington Railway & Electric Co. | ed and the companies, and insisted that have consented to proceed with a uni- fication on this basis, including the properties of the Washington Rapid Transit Co., of $50.000,000 for rate mak- ing purposes. 1 believe they deserve the commendation of the public of the District of Columbia and of the metro- politan area for their concesslons in this regard, inasmuch as such rate base is not less than $12.000.000 below that to which they are clearly entitled. “3, Rate of return.— “Another point of major discussion was the rate of return upon the agreed base value. The companies contended. and not without merit. that the risks involved in urban and interurban trans- portation justify a rate of return model- ed upon broad and generous lines. They pointed out that in many instances throughout the country, the courts have held that 8 per cent is a fair return in the fleld of urban and interurban trans. portation, and that in the case of an- other public_utility right here in the District of Columbia 1 return of 7' per cent upon an agreed valuation has been allowed. Added Concession Made. “Again the writer argued the equities of the case as between the public serv- 7 per cent. no more, no less, would alone meet the exigencies of the occasion. It s again only fair to point out that in finally conceding the point. the com- cession to the object sought. 3. Metropolitan area.— “While not mentioned in the unifica- tion agreement like several other mat ters that appear to be bevond the ince of the existing companies. be- lieve very careful consideration should be given to the question of requesting Congress to extend the jurisdiction of the Public Utilitles Commission of the District of Columbia so as to include electric railways and busses operating between the city proper and the metro- politan area. A very large proportion of the business done by such lines is 0 TIME 'FURNITURE A Famous for the Quality Of Furniture Offered Rugs Are Included The Suite Bufiet—66 inches loag —1 legr — lscquer fimsh. Chine—39 inchem wide —dra Server—38x18—Hand- some crotch o~ any. Table—a1360—extends to 6 feet, Chatrs—4 side chainy in blue haircloth, Armchairi—2armehair in biue haircloth MAYER & CO. SEVENTH STREET N OUTSTANDING FEATURE of the February Sale is the quals ity ot the furniture that is Every suite and piece is from our regue lar carefully sclected stock of sble Lifetime Furniture. As an example, note the finely made mahogany Sheraton Dining Suite illuse trated. It's an elegant interpretation of the Sheraton Spirit, embodying conveniences and beautified with crotch mahogany. Sheraton Dining Shown—Ten Pieces $295 BETWEEN D & B offered. depend. modern Suite [ | | tion of the negotiations, but I beg to | sald stock. Neither does its purchase 7 aemire vou that no umnecessary time | by the consolidated company add a °f Which the Government manufac- has been lost and that all parties to|single dollar to the rate base estab- | tured money, securities and stamps. He the matter have met in a spirit of ut- | lished in case of the traction com- | was ill only two weeks. ; most frankness and sincerity of pur- | panies alone. It is absorbed by that Coming to Washington in 1874 with pose to bring about, if possible. some | company purely and solelv as a further | Assistant Secretary of the T;'mu workable response to a well defined and | concession to the larger effort. Conant. Mr. Collins went with Mr_ Con. insistent public demand. While upon | I seek not. nor would I accept. any ant as secretary to London in 1 - numerous occasions all appearances | executive office in the new company. | connection w he Government's e ten toward utter failire. a ot that I lack confidence in its futurs | gram of refunding. being carried o sense of responsib™ty to your body and | to the contary. I make bold to predict at that time 3 = to the public has prevailed, and with | that if through your sound judgment Commissioner Broughton of the pub- Tenewed determination have the meet- | and that of the Congress which must |lic debt service today paid high tribute ings %mceeded and impasse after im- |iikewise approve, this unification comes | to Mr. Collins’ service. passe has been overcome and disposed of. | into force and efect, five years will | Surviving is the widow, Mrs. Florence Looks for Criticism. | not have run before the people of this|R. Collins. The funeral service prob- ol . community will point with pride to its | ably will be held at the residence to- “In my humble opinion the plan efficient and prosperous system of morrow afternoon. and interment will preserted for your consideration is fair ' transportation), but because I harbor be in Lowell. Mass. Priday. UE of NINTH- o« Jrom_the AVEN | A We predict that this Spring the young man's fancy will turn to— P-B Super-Value wo-Trousers Suits $38 A safe enough prediction, for these Super-Value Suits have everything a voung man wants—smartness of style, nicety of finish, the appearance one associates with higher prices—and the economy and comfort of the two- trousers feature. Single and double breasted models in the correct new shades and patterns. And, incidentally, while we stress their appeal to young men, many men a bit further along in vears will find their vouthful lines appropriate and inviting. A S ——— Sy NATTONALLY fig~ ¢