TRAMWAYS AND RATING AREAS. THE CRACK MACHINE FOR 1914.

Sun (Christchurch), Volume I, Issue 53, 8 April 1914, Page 3

TRAMWAYS AND RATING AREAS.

THE CRACK MACHINE FOR 1914.

To the Editor of THE SUN. g; r —The article which appeared in THE'SUN of April 2 on Tramways and Rating Areas has left* many aspects of the subject untouched, and some of the points raised are of a very debatable nature. . .. , , The writer's mind was considerably taken up with the Hackthorne district, and some of the comparisons made are open to objection. The question of special rating areas, it is quite evident, did not appeal to the founders of our electrical tramway svstem, or such areas would have been created for many of the districts that •were served in the original plans, besides the Eiccarton-Sockburn line as, for instance, Opawa, lemlalton, Burwood, and Cashel Street lines. One of these is not paying operating expenses, and another is barely doing so. There is as much justification for placing-Bur-wood in a special area as there is tqr Hackthorne Eoad. Each line is for the convenience of local residents, and in addition for the pleasure, of the residents of the whole city and surrounding suburbs. The .setting up of special areas was an admission on. the part ot the Tramway Board that it - wanted to avoid trouble and responsibility. It is the function of the board and its stall to seek out the best areas and routes for the extension of its tramways, and not for interested individuals to beg the board, by way of special areas, for tram servicess for, while the board may be relieved of financial responsibility in this way, it might expend its energies with more gain to itself and to the greater benefit of the community by Tunning the service in other, better selected areas. The Hackthorne distiict is rated for a large portion of -the line (from the store to the terminus) used only »v pleasure-seekers from the city, who get all the benefit of the whole of the line,-s\'hile the unfortunate lesidents have to bear the whole burden of any deficiency in running the line. However if. the rate levied does weigh unduly on anvone it is certainly on the resident who has to pay tram fares as well as rates, and not on the land-holder whose property is increased in value. The figures quoted in the article only show how low the general rate in Hackthorne is at present. When Hackthorne :has to pav the rates for recent improvements in the district the general rates, will be larger, and the tram rate will show as about half the amount of the general There are always a few "squealers" about when rates have to be paid, but the owners of property have it automatically increased in value by a tram service sufficiently to pay the rate for a number of years, and in addition they have the convenience of a service required by the majority of them. "Boosting land values" is;the par-rot-cry of the objectors to tramway extensions, and in most instances it is quite unwarranted. When an extension is made to the train system the rateable area is also extended, and m many cases includes land whicli cannot be served bv the tram for years to come. The" Hackthorne and St. Martins districts take in land extending to the Summit Eoad, and this is rated, though it is miles bijyond the tram terminus. However, the way to get rid of the speculator is.to have the tram rate struck on the unimproved value, instead of on the capital value. This T;ould stop agitations for tram extensions from any but bona fide residential suburbs. The board's policy is certainly against taking financial risks, and because it. does not care to shoulder the responsibility of extending the system, it shelters itself behind the ratepayers \)V demanding special rating districts. 'Hie article in THE SUN was incorrect in so much as the board does not now {>vcn pay working costs, but demands that tiie ratepayers shall take all the responsibility and bear any loss, while, later on, after they have paid thousands of pounds in rates and faros to build up profitable lines, the hoard will seize the profits and dump them into the ■"goner;!l scheme." This is where the board's I roubles will come in. The ratepayers in special districts will demand, and justifiably too, that the profits shall hot go into the general fund, but that the fares shall be reduced in those sjiecial areas that are profitable. Here creeps in the injustice of the "rating area system." The people who have paid rates and maximum fares will not share the profits, but a new lot of residents wlio have contributed nothing. Your article says:—"The idea of the tramway management is that, a profitable section should receive the benefit of the profit it makes." Then why not divide the whole system into areas and have differential fares and concessions, giving those

lines which pay well lower fares and greater concessions, and on the lines which do not pay levy a rate? There would be much objection raised to that, but if the system is good enough for the outer areas, it should apply all round. While special rating areas may be a safeguard for the board against demands for suburban lines, it is not complimentary to the board that it should require such a safeguard, and it is a fallacy to state that it is certain that the board make no. gain from the special rates. In addition to securing a profit to the board from the very start, the board gets increased revenue from the Hackthorne, Fendalton, Papanui, and Dallington extensions over the rest of the line, and this is unjust to these districts. They should receive something for this increased revenue or should have the revenue for the whole trip, together with its share of the inner area burdens, in the same way as the St. Martins and Ricearton lines. With regard to new lines constructed in special rating areas, there seems to be some injustice in charging these lines the same amounts for renewals, depreciation,' and maintenance, as are charged to lines On the older system, which have been running six or seven years. It would be more equitable to charge much less on these new lines during the first year or two, and increase the charge with the increase of traffic and revenue. Similarly, the interest, as well as depreciation and renewals, might be paid out of capital during the first year, so as to enable the line to get properly going. This would spread the burden of new lines over a much greater period, and would give some share of x it to future beneficiaries of the line. While it is a wise policy of the board to err on the side of financial safety, the board's predictions of a large increase in cost of renewals and increase of rolling stock have been long delayed in fulfilment, and all the time the board is piling up the reserve funds, until it now has about £150,000. This is, in addition to paying interest and sinking fund and maintaining the service, plant, etc., in a very satisfactory condition. If the concern were realised in the open market it would bring in a profit of over £IOO,OOO. How, then, can the board continually cry that it cannot make concessions or open up new lines to the outer areas? While the board takes no risk and all advantages from extended rating areas, these areas get no commensurate representation on the board. The Hackthorne and St. Martins areas should now have, a representative on the board. The interests of these portions of the district are quite distinct from the rest of the Woolston-Sumner district.— I am, etc., * J.L.

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