A regulatory commission has recommended that Washington's former bus company, the D. C. Transit System, be required to repay the public $3.3 million to compensate for excessive fares collected during the last 10 years of its operations.
The figure, much lower than some unofficial estimates, was recommended to U.S. Court of Appeals by the Washington Metropolitan Area Tranist Commission in a ruling released last week. The court must make the final decision.
To be certain the money is repaid, the transmit commission urged the court to earmark some of D.C. Transmit's valuable real estate to be sold for public benefit.
The company, headed by former New York entrepreneur O. Roy Chalk, now a Florida resident, sold its bus operations to Metro in 1973. It still owns a Georgetown office buildings, former bus garages and streetcar barns and some trolley rights-of-way. Its holdings have been estimated to be worth more than $10 million.
The transit commission's report was issued five years after the Court of Appeals ruled, in six complex interrelated cases, that some fare increases were too high because they failed to let bus riders share in the rising value of real estate that D.C. Transit had diverted from transit operations.
When D.C. Transit was formed in 1956, it brought the properties of the former Capital Transit Co., whose franchise had been canceled by Congress, for $13.5 million. At that time, the Capital Transit properties were carried on the company's books at $23.8 million, and probably were worth more than that.
Over the years, as it converted from streetcars to an all-bus operation, D.C. Transit arranged slaes or leases of many of the surplus properties, and kept the profits for itself. This, the Court of Appeals decided, was wrong.
The court told the transit commission, which had granted the disputed far increases, to calculate how much the company owed to its riders, and to recommend ways to pay it.
At the time of the court ruling, there was speculation that the repayment might exceed $20 million. D.C. Transit itself estimated that the highest figure it might owe was $33.4 million, which it said would force the firm into bankruptcy. The $33.4 million figure was the total amount the company was authorized to collect in fare increases from 1963 until it ceased operations.
Actually, during much of the period in which fares were deemend to be excessive, D.C. transit was running at cash loss. It said it needed the higher fares - which reached 40 cents in 1970 - simply to maintain operations.
The transit commission decided to make its recommendation to the Court of Appeals in two stages. First is the amount of the proposed paybacqk, $3.3 million. If the court accepts that, then the commission will propose ways for making the payment.
Figuring out how to do it - possibly by some sort of special subsidy to Metro passengers - might prove to be complicated, since the money logically would be targeted to the geographic areas formerly served by D.C. Transit.
D.C. Transit collected 85 percent of its fares in the District of Columbia and split the remaining 15 percent between Montgomery and part of Prince George's counties.
In reaching its recommendation, the transit commission conducted numerous hearings that produced 15,000 pages of transcribed testimony and exhibits.
The lawsuits that led to the Court Appeals decision and the transit commission recommendation were filed by the D.C. Democratic Central Committee, the Black United Front and attorney Leonard N. Bebchick, who sued in his own name.