The people's counsel's office and the taxicab industry have reached an agreement on a proposal that would increase District taxicab zone fares by about 22 percent across the board.

The Public Service Commission, which regulates rates for the industry, announced yesterday that it has scheduled a January hearing on the proposal that would increase the net revenue per hour for full-time taxicab drivers to $7.81 from $5.22.

The District's taxicab fares are based on zones and under the proposed increases, passengers would pay from 40 cents more for a one-zone ride ($2.10 instead of $1.70) to $1.35 more for an eight-zone ride ($8.05 instead of $6.70).

Fares for extra passengers would increase to $1.25 per passenger from 75 cents per passenger. The charge for radio-dispatched cabs would increase to 75 cents from 65 cents and the rush-hour charge would increase to $1 from 65 cents.

The PSC staff has agreed to the recommended increases and the PSC's main concern is whether the new fares would be in the best interest of the public, said Howard C. Davenport, the commission's general counsel. He noted that all the principals have agreed to the proposal, which would increase the likelihood of approval.

Ruth Hankins-Nesbitt, a PSC member, said that once the commission approves a rate increase it could make the increase effective immediately.

In recent months, the D.C. City Council and the riding public have criticized the taxicab industry for providing poor service, manifested by drivers who are rude, refuse to travel to certain parts of the city and have trouble locating such well-known places as Union Station and the District Building.

The industry, however, has not had a fare increase since 1981 and the PSC initiated proceedings in June to determine whether drivers are getting a sufficient income, Davenport said. The settlement proposed by the industry and the people's counsel's office is a response to the PSC's action.

Even with the increased fare, a District cab ride would be considered the best deal in town, according to taxicab industry spokesmen who maintain that metered cabs produce more income for drivers.

For years, the industry has tried to convince the PSC that the District's zone map creates an economic hardship for drivers.

Based on the complaints, the PSC began reviewing the map in 1979 but has not reached a conclusion.

The PSC staff has estimated that District cabdrivers have a gross revenue of $10.39 an hour and net $5.22 after expenses.

Industry representatives have mixed views about the significance of the proposed fare increase.

Dan Smith, who operates the Eastern-Imperial Cab Co. and was one of the industry representatives who agreed to the proposed fare increase, said the PSC statistics, the only ones available, are "stale data" that do not reflect the fact that an increase in the number of drivers has lowered the overall income for individual drivers.

Smith also warned that passengers should not expect any major improvements in service if the fare proposal is approved.

"There won't be any changes in service until they stabilize the industry, limit the number of cabs and limit the number of cab companies," Smith said.

"We couldn't have gotten any more than this proposed increase . The city has cheap fares and the people get cheap service."

But Joseph Bradley, president of the Professional Cabdrivers Association, said he is convinced that increasing the fares will mean that drivers will be less reluctant to travel to outlying areas of the city.

For example, Bradley pointed out that a ride from 15th and K streets NW to Atlantic and South Capitol streets, a four-zone ride, would increase from $3.90 to $4.75 or $6 for two passengers.

"I sure consider it a major increase," said Bradley. "I think drivers are going to give better service and I think there will be a difference in the attitudes of drivers."

The PSC will hold a public hearing on the proposed fare increases at 6:30 p.m. Jan. 7 at 451 Indiana Ave. NW, Room 200.