Mr. ROPER. That is for approximately 20 months. The unexpended balance as of November 1 can be approximated, as we keep a monthly budget, which we keep well within. I ought to first give the unexpended balance on October 1, 1921, which was $10,571.81, making a total of expenditures and unexpended balance of $65,000, representing an original appropriation of $50,000 plus a deficiency appropriation this spring of $15,000, totaling $65,000 in all. The unexpended balance on November 1, this month, would be approximately $6,809.21. That is all we have left. The CHAIRMAN. How many commissioners are there, what salary do they get, and how many assistants have they, and what do they get, and then go on and tell us just what you do? Mr. ROPER. We have three commissioners at an annual salary of $5,000 a year. We have an attorney for the rent commission, appointed October 6-last month-at a salary of $5,000 a year, and authorized by the extension act approved August 24, 1921. The CHAIRMAN. Is that the first time you have had an attorney? Mr. ROPER. Yes, sir. The CHAIRMAN. How did you get along without an attorney before? Mr. ROPER. We did not necessarily need one because of the fact that from June, 1920, until April, 1921, the law had been held unconstitutional by the Court of Appeals of the District of Columbia, and there was apparently no need for one during that time. There was a desire for one previously and since then until October. The CHAIRMAN. During the period of the law's unconstitutionality what did the board do? Mr. ROPER. The board continued to hand down decisions and fix rentals upon the firm conviction that the law was constitutional, even though the Court of Appeals of the District had held it unconstitutional. An appeal would naturally be taken and would justify the commission continuing in operation. DUTIES OF ATTORNEYS. Mr. GALLIVAN. Right there, Mr. Chairman, if this is the proper time and place to ask the question, What does your $5,000 lawyer do? Mr. ROPER. He is at present engaged in defending a case in which the Rent Commission is made party defendant, a suit brought by one Mr. Mertz, the owner of the Prince Karl Apartment House, who claims that the amounts fixed on the Prince Karl in January, 1921, were confiscatory, and attacks section 112 of the rents act which calls for certain rebates to be paid back to the tenants who were continued to be overcharged in spite of the decision of the Rent Commission, because of that interim of unconstitutionality-he claims that he was the owner only after those rates were fixed, and that when he became owner he was not informed of the rents which had been set on the buildings, and sets up certain other reasons which he alleges in his suit Mr. GALLIVAN (interposing). You need not go any further along that line; but what else does he do? Mr. ROPER. He has to prosecute these suits for rebates in which there have been such a tremendous number of overcollections. Mr. WOOD. In a case where an apartment house owner or property owner is cited to come before you to answer as to whether or not he is charging too much rent, does this attorney appear in such cases? Mr. ROPER. No, sir; not ordinarily. Mr. WOOD. Who represents the commissioners, in a legal way at those hearings? Mr. ROPER. At those hearings, you understand, we have the power of subpoena which can be enforced in the Court of Appeals of the District of Columbia, to summon such people. Mr. WOOD. But who examines the witnesses when they come in there? Mr. ROPER. The three commissioners themselves." Mr. Wood. The attorney does not have anything to do with the trials there? Mr. ROPER. No, sir.. Mr. SISSON. He sometimes attends those trials, does he not?, Mr. ROPER. He attends them at all times when he is free, in order to inform himself about the procedure. Mr. BYRNS. And he would attend them, I take it, if the commission felt they needed his services? Mr. ROPER. At any time; yes, sir. Mr. KELLEY. But his real duty is in connection with defending the commission when attacked in reference to their decisions? Mr. ROPER. Yes, sir; preparing briefs and appearing in court. Mr. ANTHONY. What is going to happen when the Rent Commission goes out of business in May next? Mr. ROPER. Well, it is a question as to whether they are going -out of business. Mr. OYSTER. The situation is going to be worse than it ever was. Mr. ANTHONY. Are you going to ask for its continuation? Mr. ROPER. I am not prepared to say that we are, but I should say that the Armament Conference, because of the demand being made for property, is evidently going to last and keep extra people in town, and in addition to that, there is an apparent shortage according to the statement of one of the most prominent realtors of 6,000 houses renting at between $40 and $50 a month, and until that apparent shortage is done away with by building, there is no relief. Mr. ANTHONY. So you propose to attract capital here to build those necessary houses by keeping the rents down? Mr. ROPER. Capital is waiting on labor-in fact all building is waiting on labor and capital, it seems to me, rather than on these other things. ACTIVITIES. Mr. ANTHONY. What has the Rent Commission actually accomplished so far? Mr. ROPER. They have fixed rentals on over 2,000 properties. They have started this week to fix rentals wholesale on their own iniative, and have called a hearing for the first large property, being a large place on Sixteenth Street. Mr. ANTHONY. Are the decisions of the commission accepted by the owners of property? Mr. ROPER. Yes, sir; they are enforced now. Mr. ANTHONY. All of them? Mr. ROPER. Yes, sir. Mr. ANTHONY. In the case of these large apartment houses where you have decided what shall be a fair rental, do the owners accept your verdict? Mr. ROPER. Yes, sir; and the verdict takes the place of all evidence in the Municipal Court where the judgment is rendered on it and is enforcible. Mr. ANTHONY. What is the contention in the case of this large apartment house on Sixteenth Street that you spoke about? As I remember, the commission previously recommended or issued a decision as to what the rents should be in that apartment house? Mr. ROPER. No, sir; they have not. They have had several complaints from there which have not been heard as yet, but which will be combined with their own initiative schedule this week. The main complaint is that in spite of fairly good service, the rentals are out of all proportion to the conceivable value of six or eight rooms with ordinary service, telephone, etc. The rental for eight rooms is over $300. Mr. WOOD. And they have recently raised the rents in that apartment house? Mr. ROPER. I understand, they have demanded increases. The CHAIRMAN. How do you reach a conclusion as to the value of space? Mr. ROPER. That is reached by considering many kinds of evidence. The rentals are not fixed on a per-room basis or by space. All of the facts and figures are taken into consideration. Perhaps Commissioner Oyster could tell this better, as I do not sit in the deliberations on these cases, and the system of determining this is very largely the same as obtained when Commissioner Oyster was a member and chairman of the Rent Commission. Mr. KELLEY. I think what the chairman wanted to know was whether you used the reproduction value as the basis in fixing rents? Mr. ROPER. We consider several values. You understand, of course, I do not consider any of them because I am not in the deliberations, but the commission considers first of all, the assessed value, dividing that value by 2 and multiplying by 3 will give the appraised value, which I understand is the value in normal times when the seller does not have to sell and the buyer does not have to buy. That is the appraised value for purposes of taxation. That is one value. Second, the market value of to-day is stated by the owner as evidence at the hearing. Then there is the cost value plus the value of all improvements put on the property since the time of construction. There you have three different values and any other value that may be presented; for instance, the reproduction value, as just mentioned, is considered also. All these values are considered together. The CHAIRMAN. Do you consider the question of vacancies? Mr. ROPER. There are no vacancies to speak of. The CHAIRMAN. Well, there may not be any vacancies, but would that be taken into consideration? Mr. ROPER. It would, if it were brought out in evidence that there had been apartments idle. Mr. Woop. Is deterioration figured in? Mr. ROPER. Yes, sir; 2 per cent, as I understand, or very close to that, is allowed for depreciation. Mr. ANTHONY. What is the basis of gross return that you allow the owner of rented property? Mr. ROPER. Between 6 and 8 per cent net, allowing him certain credit for his loans and the amount of interest which he pays. Mr. ANTHONY. Wear and tear, and everything? Mr. ROPER. Yes, sir. It would vary between 6 and 8 per cent, giving the owner the benefit of the higher percentage whenever he keeps up his property in good shape. Mr. KELLEY. What would that be gross, about 1 per cent a month? Mr. ROPER. Just about, sir. In the ordinary case, slightly over 11 per cent a year. The CHAIRMAN. What do you expect to do with this additional money? Mr. ROPER. We expect to run the commission from the 22d of December until May 22. The CHAIRMAN. Does that contemplate running the commission until Mr. ROPER (interposing). Until May 22, the expiry date of the act. The CHAIRMAN. Does this cover an increased force? Mr. ROPER. No, sir; we have capable people and we do not want employees getting in one another's way. We have a very efficient force, which we increased in May of this year; in fact, practically doubled it. Mr. KELLEY. This is simply to pay the expenses of the commission from the time the old law stopped until the present law expires? Mr. ROPER. It is a little better than that, because of our economy. We have an unexpended balance from our appropriation, and instead of running us only to October 22, it will run us to December 22. Mr. KELLEY. This $6,000 is the present balance? Mr. ROPER. Yes, sir; that is the present balance, and it will be entirely expended by December 22. That makes it necessary to secure as early an appropriation as possible. The CHAIRMAN. How many people are on your pay roll; what is the average compensation paid; and what is the aggregate pay roll monthly? Mr. ROPER. There are 3 commissioners, 1 secretary, 1 attorney, 1 advisory assistant, and then there are 10 employees, including the secretary-reporter. The CHAIRMAN. What is the aggregate monthly pay roll? Mr. ROPER. The aggregate monthly pay roll is $2,815.94, plus $416.66 for the attorney. The CHAIRMAN. How many cases are pending for adjudication before the commission? Mr. ROPER. There are some 800 rent cases and approximately 100 possession cases. We are up to date, and have been for some time on possession cases. The CHAIRMAN. How many cases do you dispose of in a month? Mr. ROPER. We dispose of approximately 15 cases per day, and there are only four hearing days in a week. That would be 60 cases a week. Mr. GALLIVAN. Does the commission take up any cases on its own initiative, or only those that are presented to it? Mr. ROPER. Under the law they were authorized and directed to take them up on their own initiative, and they have started now to taking them up on their own initiative. Mr. Wood. Where there is a flagrant ease of overcharge on the part of a property owner, has the commission any power to inflict a penalty by an assessment of costs for the hearing, or anything of that character? Mr. ROPER. There is power to fix certain damages, but it is a very general power. In the case of a flagrant overcharge they are enabled to fix a rent which will be a kind of penalty also. In the case of the Monmouth Hotel, the commission reduced the rents 46 per cent. That was because of the wretched condition of the building, the condition of the service, and construction, generally. That was an apartment house at 1819 G Street. Mr. Woop. They did not tax them anything on account of the cost of the hearing? Mr. ROPER. No, sir. Mr. KELLEY. Where one tenant in an apartment house has a complaint, and your board reviews the situation and finds that the charge is exorbitant, do they then put the new charge into effect for other tenants? Mr. ROPER. They have not done so previously. Mr. KELLEY. Are they to do that? Mr. ROPER. That is a matter of question. That has been a problem for them for sometime, and it is my opinion that they will do that in the future. We have had so much to do in the past in passing upon the complaints that were made, that we have simply passed on to another large apartment house, hoping that the owners would scale their charges down for the sake of fairness. They have done so in a few cases. Mr. WOOD. Those have been very exceptional cases, have they not? Mr. ROPER. Yes, sir. Mr. ANTHONY. You mentioned the case of the Monmouth Hotel: How did you fix the value of that building? Did you base it on what it actually cost? That building was erected during the peak of war time construction costs. Did you fix it upon the basis of its actual cost or upon the present day cost? Mr. ROPER. I will have to ask Capt. Oyster to answer that question. Mr. OYSTER. It has been so long ago that I do not believe I will be competent to answer with reference to it. Mr. KELLEY. Suppose you answer it in a general way, by stating whether you allowed the actual cost of construction to be the basis of the valuation, if that construction was made at the peak of war prices? Mr. OYSTER. Well, each case governs itself. In the Monmouth Hotel case, that building was constructed in such a way that there was general complaint. As I recall it, there were 30 or 40 tenants who applied for a readjustment of rent there. We took the value of the property, and other contractors to give us estimates on what the building would cost. We had architects who gave us their views, and we had the assessor of the District to testify as to the ground values. We endeavored to be as liberal as possible in allowing these men a fair return on the investment. The conditions there in the Monmouth Hotel particularly were such that they were not entitled |