WASHINGTON METROPOLITAN AREA TRANSIT COMMISSION, Hon. THOMAS F. EAGLETON, U.S. Senate, DEAR SENATOR EAGLETON: I have your letter of May 16, 1969, asking for our comments on the amounts owed to the Government of the District of Columbia by D.C. Transit Company, Inc., for track removal. I have reviewed the memoranda attached to your letter and, while we have not checked the specific accuracy of the figures cited due to the press of time in meeting your suggested deadline for comments, the facts appear to be accurate on the basis of our general knowledge of the books of the company. In answer to your specific question, the amounts in question have been deducted from the track removal reserve as reflected on the books of the company. The company's accounting for tax purposes, regulatory purposes, and general accounting purposes is done on an accrual basis. This means that a reserve such as track removal reserve is debited when a liability attributable to that reserve is incurred, i.e., when a bill for track removal is received by the company. The debit to the reserve account, under accepted accounting principles, has nothing whatever to do with whether the bill is paid. Thus, the accounting treatment of the amounts presently in arrears was entirely in accord with established accounting principles and sound regulatory practice. I do not wish the foregoing paragraph to be understood as condoning the company's failure to pay this obligation. The company collected the money with which to pay this debt from the riding public and it had a fixed statutory obligation to pay the bills rendered to it by the District Government for track removal. While the Commission was aware of the existence of this obligation due to our continuing audit of the company's books, we have not been consulted by D.C. Transit or by the District Government concerning the matter. The Commission has not made any representations on its own motion with regard to this obligation either to the company or to the District Government. The District Government is a creditor of D.C. Transit, a status occupied by a number of other individuals, corporations, and government entities. It would not, in our judgment, be a proper exercise of the Commission's functions to require the company to give preference to any one creditor over another. In the first place, our power to do so is highly doubtful. Moreover, making such choices for the company would quickly lead to complaints from other creditors and embroil the Commission in the functions of company management to a degree which every utility regulator would recognize as undesirable. I trust this provides you with the information you require. If we can be of any further assistance, please let us know. Sincerely yours, GEORGE A. AVERY, Chairman. WASHINGTON METROPOLITAN AREA WHEREAS, the Commonwealth of Virginia (Ch. 627, 1958 Acts of Assembly), the State of Maryland (Ch. 613, Acts of General Assembly, 1959), and the Commissioners of the District of Columbia (Resolution of the Board of Commissioners December 22, 1960) have heretofore entered into and executed the Washington Metropolitan Area Transit Regulation Compact on December 22, 1960, as amended March 29, 1963; and WHEREAS, the Congress of the United States has enacted legislation (Public Law 774, 80 Stat. 1324), whereby it has (1) given its consent to the State of Maryland and the Commonwealth of Virginia to effectuate an amendment to said Compact by adding thereto a Title III (known as the Washington Metropolitan Area Transit Authority Compact), and (2) adopted and enacted the said amendment for the District of Columbia; and WHEREAS, the State of Maryland (Ch. 869, Acts of General Assembly 1965), and the Commonwealth of Virginia (Ch. 2, 1966 Acts of Assembly) and the Commissioners of the District of Columbia (Resolution of the Board of Commissioners adopted on November 15, 1966) have adopted said amendment to the Compact: NOW, THEREFORE, the District of Columbia and the States of Maryland and Virginia, hereinafter referred to as signatories, do hereby amend the Washington Metropolitan Area Transit Regulation Compact by the following addendum thereto, and do thereby covenant and agree as follows: TITLE III ARTICLE I DEFINITIONS 1. As used in this Title, the following words and terms shall have the following meanings, unless the context clearly requires a different meaning: (a) "Board" means the Board of Directors of the Washington Metropolitan Area Transit Authority; (b) "Director" means a member of the Board of Directors of the Washington Metropolitan Area Transit Authority; (c) "Private transit companies" and "private carriers" mean corporations, persons, firms or associations rendering transit service within the Zone pursuant to a certificate of public convenience and necessity issued by the Washington Metropolitan Area Transit Commission or by a franchise granted by the United States or any signatory party to this Title; (d) "Signatory" means the State of Maryland, the Commonwealth of Virginia and the District of Columbia; (e) "State" includes District of Columbia; (f) "Transit facilities" means all real and personal property located in the Zone, necessary or useful in rendering transit service between points within the Zone, by means of rail, bus, water or air and any other mode of travel, including without limitation, tracks, rights of way, bridges, tunnels, subways, rolling stock for rail, motor vehicle, marine and air transportation, stations, terminals and ports, areas for parking and all equipment, fixtures, buildings and structures and services incidental to or required in connection with the performance of transit service; (g) "Transit services" means the transportation of persons and their packages and baggage by means of transit facilities between points within the Zone and includes the transportation of newspapers, express and mail be tween such points but does not include taxicab, sightseeing or charter service; and (h) "WMATC" means Washington Metropolitan Area Transit Commission. ARTICLE II PURPOSE AND FUNCTIONS Purpose 2. The purpose of this Title is to create a regional instrumentality, as a common agency of each signatory party, empowered, in the manner hereinafter set forth, (1) to plan, develop, finance and cause to be operated improved transit facilities, in coordination with transportation and general development planning for the Zone, as part of a balanced regional system of transportation, utilizing to their best advantage the various modes of transportation, (2) to coordinate the operation of the public and privately owned or controlled transit facilities, to the fullest extent practicable, into a unified regional transit system without unnecessary duplicating service, and (3) to serve such other regional purposes and to perform such other regional functions as the signatories may authorize by appropriate legislation. ARTICLE III ORGANIZATION AND AREA Washington Metropolitan Area Transit Zone 3. There is hereby created the Washington Metropolitan Area Transit Zone which shall embrace the District of Columbia, the cities of Alexandria, Falls Church and Fairfax and the counties of Arlington and Fairfax and political subdivisions of the Commonwealth of Virginia located within those counties, and the counties of Mont gomery and Prince George's in the State of Maryland and political subdivisions of the State of Maryland located in said counties. Washington Metropolitan Area Transit Authority 4. There is hereby created, as an instrumentality and agency of each of the signatory parties hereto, the Washington Metropolitan Area Transit Authority which shall be a body corporate and politic, and which shall have the powers and duties granted herein and such additional powers as may hereafter be conferred upon it pursuant to law. Board Membership 5. (a) The Authority shall be governed by a Board of six Directors consisting of two Directors for each signatory. For Virginia, the Directors shall be appointed by the Northern Virginia Transportation Commission; for the District of Columbia, by the Commissioners of the District of Columbia; and for Maryland, by the Washington Suburban Transit Commission. In each instance the Director shall be appointed from among the members of the appointing body and shall serve for a term coincident with his term on the body by which he was appointed. A Director may be removed or suspended from office only as provided by the law of the signatory from which he was appointed. The appointing authorities shall also appoint an alternate for each Director, who may act only in the absence of the Director for whom he has been appointed an alternate, and each alternate shall serve at the pleasure of the appointing authority. In the event of a vacancy in the Office of Director or alternate, it shall be filled in the same manner as an original appointment. (b) Before entering upon the duties of his office each Director and alternate director shall take and subscribe to the following oath (or affirmation) of office or any such other oath or affirmation, if any, as the Constitution or laws of the signatory he represents shall provide: |