Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1913-10-23
Admits He Told Stickney That
Some Legislators Wanted
Free Telephones.
DEPRECIATION IS EXPLAINED
President Spaulding of New
England Company Says
Rate in Vermont Ex-
ceeds 6 per Cent.

Montpelier, oct 17.--Charlos A. Plum
ley, speaker Of the House at the last ses-
sion and now commissioner Of State taxes,
was called by the State as witness at
the telephone hearing this morning to
deny that he had requester the free telc-
phone service which it was testified yes
terday had been given to members Of tho
Legislature ana various state officials.
Mr. Plumey denied making such a re-
quest, but admitted that he had a con-
versation with w Il. G. Stickney, in
which he communicated the complain If
some members because the usual free
telephone service had not been rstab-
ished
The only other witness examined to-
day was Philip L. Spaulding, president
of the New England Telephone and Tele-
graph company Mr.. Spaulding's testi-
mony to-day related entirely to the mat
ter of depreciation.
STr. Spauldng was graduated from Har-
ward in 1882 and afterward took special
/ course. receiving the degrees of \. NJ.
and r. s in 1893 and 1894, respectively.
| He at once went to work in the engineer
/ ing department of the Bell Telephone
company in Boston and remained there
I about six months. Then he went to Phil
! adelphia. whore he was successfully chief
| inspector of instruments and repair work,
assistant engineer, engineer. general SUI
perintendtn, general managerand second
vice-president and director
In speaking of the matter Of deprecia-
ton, Mr.. Spaulding said:
THE fixing or determining OF a
proper rate of depreciation is now very
largely an engineering matter Of what
best method of determining what Is
going to happen, of what the service
life of piece Of property is, is to see
what the accumulated experience has
been of the parts. and from that to
make the best determination of what
should be provided for in the present
and in the future Now depreciation
! being the loss in value Of property,
! its serviceable life service life is not
always involved with the question Of
the pure physical life of the property.
DUE TO CHANGES IN THE ART
Depreciation occurs not alone from
the loss in physical value, or what is
commonly called the loss from wear
and tear, but also occurs from OBJ
solescence, that is, changes in the art,
and from inadequacy and from munich
common examples that are seen are
from wear and tear examples of what
/ is occurring in regard to these other
4 items of obsolesccnce, and inadequacy
and municipal regulation. There are
! some very pertinent examples right
here in the state of Vermont.
The change from the magnetic Sys-
tenn to the common battery system IS
primarily caused by what is called change
! in the art, or obsolescenCe. There have
been several examples of depreciation
| loss occurring for that reason here in
the State of Vermont, and one is going
/ on now in Bellows Falls, where the old
| magnetic switchboard is being removed
and new common battery switchboard
is being installed; and in a change of that
/ kind not only is ii necessary to replace
all of the central office apparatus or the
exchange apparatus, but all of the in
struments themselves throughout the
town have TO be changed in type, and a
great deal of work has TO be done in re-
! constructing and rebuilding the lines
| themselves. because with a common bat
| terry system it is essential that the in
Sulation of the circuits be in very much
better condition than with a magnetic
circuit The common battery system, al
though giving a very much better kind
OF service, more accurate and more
reliable and speedier service, is also a
very much more expensive service to
give. particularly in the smaller places.
Examples o. depreciation caused by
municipal regulations occur. have occur
red in several instances l suppose the
best example here in Vermont is in con-
nection with the construction out here
on state street In front OF the capito,
and down to the center of the town,
where as a result of an order Of the
Vermont public service commission, the
electric light companies and the teie-
phone company We're ordered to i.nprove
the conditions on the street here, 10 see
that the wires were re-arranGed and put
in proper condition and as result of
that it became necessary for the YER
mont Telephone company to remove it's
overhead plant. its overhead cable, to
construct underground condutS and t.
place the wires under ground,
VERMONT RATE ABOVE AVERAGE
The depreciation table, which repre-
sents our best accumulated experience,
provides for an item a percentage of de-
! probation to be applied to each kind Of
property, and then after that has been
applied an average figure Is struck
representing the charge for depreciation
which should be made to the property as
| a whole.
In the New England company the
| percentage of depreciation, arrive
at from that method OF application,
that is to say. the average rate of de
+, probation, runs for the New England
| company as whole approximately
six per cent. For the state of Yer
mont my recollection is that it Will
run something higher than that. prob
| ably nearer 6l2 or seven per cent.
The rate of depreciation that is a rate
as applied to the whole property AMI
is the average rate, based on the re.
quirement of the interstate commerce
commission. where it states that, tho
| rate of depreciation should be based
upon the average life of the units
comprised in the respective classes of
property"
The commission will be in Boston
next week, attending the hearing on
railroad rates, and the members have
been invited TO make an inspection Of
the plant and METHODS of the New
| England company
Sessions viii BE- resumed here
week from next Wednesday