Mr. Dowdy. Do you have a question? Mr. MCKINNEY. No. Mr. CHALK. That completes our statement. We endorse the bill, as presented by the chairman of the Com mission. Mr. Dowdy. Thank you, Mr. Chalk. Mr. CHALK. Thank you. (The editorials referred to and submitted by Mr. Chalk are as follows:) [Reprint from the Evening Star, Mar. 27, 1971] SCHOOL BUS FARES Before Senator Inouye's subcommittee the other day, George Avery, the head of Washington's transit regulatory agency, charged that the City Council used "unconscionable" judgment in moving to kill a subsidy payment to D.C. Transit for carrying school children at reduced fares. We agree. The subsidy, in the amount of $2.5 million, appeared in Mayor Washington's budget for the next fiscal year. Last week, in attempting to whittle down the mayor's fiscal proposals, the council voted to kill the item entirely-on grounds that no school transit subsidy should be paid until D.C. Transit retires an $18million obligation to the city for streetcar-track removal. According to Avery, the council was wrong on at least three counts. First, he said, D.C. Transit's current track-removal debt is not $18 million but something under $600,000. Presumably this lesser amount could, and we think should, be withheld, assuming legislative authority is obtained to do it. But that is quite different than removing the entire subsidy from the budget. Secondly, Avery charged that payment of an annual transit subsidy is a statutory liability, not subject to administrative whim. And most importantly, he said, the assumpton that it would be paid was "cranked into the financial equation" which Avery's agency had used in allowing the current 40-cent adult bus fare. Should no subsidy be paid, Avery said D.C. Transit might well seek a further immediate fare increase, which his agency would have no alternative but to consider. After hearing Avery's testimony, Senator Inouye, whose subcommittee handles the city budget, said he was inclined to support restoration of the subsidy. But this is a matter which should not have to be resolved in Congress. It is widely assumed that as part of his response to the council's actions, expected any day now, Mayor Washington will veto the transit deletion. He certainly should do so, and the council should do nothing more to confuse the situation any further. [Reprint from the Washington Post, Nov. 9, 1970] CHALK-STALKING It's only been a matter of months since the great uproar over the 40-cent bus fare, but anyone who still hops aboard O. Roy Chalk's droopy-eyed green coaches will discover that except for the louder clinking up front at the farebox, you don't hear much noise about the price anymore. That's to be expected, we suppose, since habit and human resignation have a way of overtaking full-fledged indignation. But around the time of the fare increase-and no doubt this will apply as well to the next fare increase-people are furious and revive, for the umpteenth time, their drive for a public takeover of D.C. Transit and for a public subsidy to make the takeover really work. We have supported these steps and only wish Congress would pay some attention to them without waiting for a crisis of major proportions. Thus it is not hard to understand the impatience of city council chairman Gilbert Hahn Jr. with the bus system and with the failure of officials to change it. It is made even more understandable when one reads that D.C. Transit shows a profit on reports filed with the Washington Metropolitan Area Transit Commission. Finally, it is puzzling to see that a school fare subsidy to the company is in a sense making the difference between a profit and a loss. Mr. Hahn feels that the most effective way to hasten the departure of the private bus firm is to bring about its financial collapse. He has indicated that he may try to cut off the school fare subsidy, for a start. It is entirely conceivable that this step might have the desired result. But it seems a drastic and not necessarily sure-fire way to run out a bus company that, like it or not, is entitled by law to a rate of return. Besides, the subsidy is designed not so much to help the bus company, but to help the parents of children who have to ride the buses. And cutting off one subsidy now might make it harder to propose a larger subsidy later. The arrangement as it exists is a poor one, that leads us from one fare increase to another all to help provide some sort of profit for a private firm with intricate accounting procedures. It is the franchise, not the subsidy that ought to be cut off. Mr. Dowdy. Mr. Graham Watt, Assistant to the D.C. Commissioner. STATEMENT OF GRAHAM W. WATT, ASSISTANT TO THE D.C. COMMISSIONER; ACCOMPANIED BY JAMES DUVALL, LEGISLATION OFFICER FOR THE DISTRICT OF COLUMBIA Mr. WATT. Good morning, Mr. Chairman, members of the committee. I have with me Mr. James Duvall, who is the Legislation Officer for the District of Columbia. I have quite a brief statement I would like to make, and then I would add a couple of informal comments, if I may. I am pleased to appear before you today to testify on H.R. 6638, a bill which would amend existing law to extend for three years beyond its present deadline, to August 31, 1974, the subsidy to common carriers providing reduced fares for school children traveling to and from schools in the District of Columbia. Extension of the subsidy for transportation of school children is a recognition of the fact that such trasportation is a public responsibility and the cost should be shared by all taxpayers, not just those who ride the buses. If the subsidy is not extended beyond the August 1971 expiration date, it is very likely that there will be an increase in bus fares in the District of Columbia. Such an increase, based on experience in piration date, it is very likely that there will be an increase in bus fares ship. I believe that every effort should be made to prevent such a selfdefeating cycle if adequate bus transportation is to be made available at reasonable cost to the citizens of the District of Columbia. PROPOSED AMENDMENT In his report on H.R. 6638-which I ask at this time to have inserted. in the record of this hearing-the Commissioner recommends an amendment to existing law, in addition to that contained in H.R. 6638. This amendment would allow the Commissioner to reduce the amount owed a carrier by the District Government, as a result of transportation of school children, by whatever amount the carrier may owe the District Government. An example of this situation would be the amount owed the District Government by the D.C. Transit Company for track removal work performed by the District Government. At the present time, as you have heard, the D.C. Transit Company owes the District Government $585,827 for such work. The proposed amendment would also authorize the Commissioner to transfer the amount which is owed the District Government by the carrier to the appropriate District of Columbia fund. In the case of track removal, the Commissioner could transfer the amount owed the District to the Highway Fund, thereby replenishing that Fund for expenditures made from that Fund in connection with the track removal. Parenthetically, Mr. Avery has advised me that he has reviewed the language of the amendment and that he does endorse the amendment proposed by the Commissioner. I believe that this setoff provision would result in an equitable solution to those situations in which a carrier is in arrears in its obligations owed to the District Government. I urge favorable consideration by this committee of H.R. 6638, amended as I have suggested. Thank you. (The report of the Commissioner referred to follows:) Hon. JOHN L. MCMILLAN, THE DISTRICT OF COLUMBIA, Chairman, Committee on the District of Columbia, U.S. House of Representatives, Washington, D.C. DEAR MR. CHAIRMAN: The Commissioner of the District of Columbia has for report H.R. 6638, a bill "To amend the Act of August 9, 1955, relating to school fare subsidy for transportation of school children within the District of Columbia." The Act of August 9, 1955, as amended by the Act approved October 18, 1968 (D.C. Code, sec. 44-214a), requires the Government of the District of Columbia to make up the difference between the total of all reduced bus fares paid to a carrier for the transportation of school children and the amount which would have been paid to the carrier at the lowest adult fare established by the Washington Metropolitan Area Transit Commission for regular route transportation during the time period involved. The reduced fare for school children is presently established at ten cents for one-way transportation. H.R. 6638 would extend for three years beyond its present deadline, to August 31, 1974, the subsity to common carriers providing reduced fares for school children traveling to and from schools, and thus allow such common carriers to continue to offer these reduced fares to school children. While concurring in the need to extend the period for such fare subsities, the Commissioner wishes to recommend an amendment to existing law in addition to that contained in H.R. 6638. Accordingly, the Commissioner recommends that H.R. 6638 be amended in the following manner: 1. By inserting in line 7 immediately after the word "amended", the designation "(a)". 2. By striking the period at the end of line 8 and inserting in lieu thereof a comma and the following: "and (b) by adding a colon and the following proviso at the end thereof: 'Provided, That the Commissioner is authorized to reduce such payment by an amount equal to such sums as may be due and payable to the District of Columbia by such carrier and transfer the amount remaining after such reduction to the appropriate District of Columbia fund." ". This proposed amendment would add a proviso to existing law so that the Commissioner could reduce a payment to a carrier, with respect to which a certification is filed, in such an amount as would be equal to sums which are due and payable to the District of Columbia Government by the carrier. This "setoff" provision would allow, but not require, the Commissioner to reduce the amount owed a carrier, as a result of transportation of school children, by whatever amount the carrier may owe the District Government. An example of the latter would be the amount owed the District Government by the D.C. Transit Company for track removal work performed by the District Government. At the present time, D.C. Transit Company owes the District Government $585,827 for such work. The proposed amendment would also authorize the Commissioner to transfer the amount which is owed the District Government by the carrier to the appropriate District of Columbia fund. In the case of track removal, the Commissioner could transfer the amount owed the District to the Highway Fund, thereby replenishing that fund for expenditures in connection with the track removal. The Commissioner believes that this setoff provision would result in an equitable solution to those situations in which a carrier is in arrears in its obligation owed to the District Government. The cost to the District Government of payment for school children transportation is estimated to be $2,594,300 in fiscal year 1972. Assuming a constant fare structure, the cost is estimated to be $3,020,000 for fiscal years 1973 and 1974. Subject to the foregoing comments, the Commissioner of the District of Columbia recommends enactment of H.R. 6638. Sincerely yours, GRAHAM W. WATT, Mr. WATT. If I may add, Mr. Chairman and gentlemen, a further comment, prompted by Mr. McKinney's question: OTHER SUBSIDIES IN EFFECT We are, at the present time, in addition to the school transit subsidy, which is projected to cost the District somewhere between $2.6 million and $3 million over the next two to three years, in addition to that subsidy, we are further the subsidizing the operation of D.C. Transit through the forgiveness of gasoline tax, District gasoline tax, and of District real estate taxes. The latest figures I have here with me at this hearing are: For the period ending in August, 1968, which indicates in that 12 months period, including August, 1968, the value to the carrier of this subsidy was about $836,000. So, you can see that at the present time the District of Columbia— the taxpayers of the District are assisting D.C. Transit to maintain fares as low as they are to the extent of $3.5 million a year. Finally, the $493,000 which Mr. Chalk has indicated is owed by the city to the D.C. Transit under the old subsidy legislation is a sum for which we have been seeking appropriation from the Congress. It is currently being proposed to the Congress in our Second Supplemental Appropriation for the Fiscal Year 1971. Once those funds are appropriated, they will, of course, be paid promptly by the District to the carrier. Mr. Chairman, if you have questions, I will be happy to try to answer them for you. HOW SCHOOL TICKETS ARE ISSUED Mr. Dowdy. Of course, it has beensome years since I bought any student-fare tickets, but does the District buy the tickets or the school buy the tickets now and distribute them to the children, or do they still go up to get a certificate from a teacher and go down to the bus company and buy them? Mr. WATT. It is my understanding that it is the latter procedure. The students receive a certificate which qualifies them to buy the tick ets, and then they are bought at either the bus company offices or, I think, several other outlets which have, I think, been authorized or franchised, including, I believe, some banks. Mr. Dowdy. Does the District Board of Education buy a lot of these tickets? Mr. WATT. I think, under some circumstances, it may be that the Board of Education does provide transportation on public carrier for students. I, frankly, do not know what those circumstances might be. I would be happy to inquire into that and submit for your record the results of that inquiry. Mr. DOWDY. Is it in substantial numbers that they buy those, or just a few? Mr. WATT. It is not my recollection that there is any substantial amount shown in the Board of Education's appropriation for this purpose. The Board of Education, of course, does operate its own fleet of school buses to provide some transportation for school students. To that extent that operation is supplemented by the Board's actually providing student bus tickets or bus fares, I would have to find out for you, sir. Mr. DOWDY. Could you provide us some information about how many of those tickets are bought, how they are distributed and how liberally they are distributed? I think it would be useful information for us, if we find out all of them are used for the purposes of school children or if they are just promiscuously used. Mr. WATT. I will get that information from the Board of Education and provide it for the record, yes, sir. (The information follows:) Mr. DOWDY. Now, do you exercise any control over the distribution and use of these tickets? Mr. WATT. No. The function of the Commissioner here, really, is to pay the charge when it has been certified to us by the Transit Commission. Mr. DowDY. I am talking about the ones that are bought by the schools. Mr. WATT. No, that would be handled entirely within the province of the Board of Education. Mr. Dowdy. Could you find out about that for us, about what control they exercise over their distribution? Mr. WATT. I will, yes, sir. (The information subsequently submitted by Mr. Watt follows:) THE DISTRICT OF COLUMBIA, Washington, D.C., April 26, 1971. Hon. JOHN DOWDY, DEAR MR. DOWDY: At the April 7th hearing before your subcommittee on H.R. 6638, a bill relating to school fare subsidy for transportation of school children within the District of Columbia, you requested certain information concerning the purchase of reduced fare bus tickets by the District of Columbia public school |