Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1914-03-19
NEW ENGLAND
COMPANY TO
FILE AN APPEAL
Unprecedented Step, Says Vice.
President Hall, Is Warrant
ed by Circumstances of
Vermont Case.

Boston, March &c --Nice-Ifesldent r. ~
Hall of the New England Telephone &
Telegraph company. made the following
statement of the position Of that COM
pany relative to the order issued by the
majority of the public service commits
sion of Vermont
Never before in the history OF the
New England Telephone & Telegraph
company has it taken any appeal from
any order or recommendation by any
commission. either State or federal. Cir
cumstances surrounding the present case,
however. are peculiar and the finding Is
one which the company is unable to un-
derstand, In view of the facts and the
evidence presented to the commission.
I'm Justice to the telephone using pub
lie in the State of Vermont and the other
States where the company operates, as
well az in Justice to the company it.
self, the officers Of the company feel
that it is their duty to appeal from the
decision Of the majority of the commits
sion in this case, and wish to state frank
ly why such an action seems to be the
only course fairly open to them.
"The net revenue of the New England
company on its Vermont business at the
present time represents less than two
per cent. return on the value Of the
property located in Vermont The reduc
tons proposed by the majority of the
commission would practically wipe out
all of this net revenue.
although the commission admits in it's
opinion that the company Is entitled to
earn at least six per cent. 1t undertakes
to establish. by the order of the ma
iority, a set Of rates under which it
would be impossible to earn even one
per cent provided the company continued
to maintain it's plant and the quality Of
It's service
1.-The majority opinion seeks to Justify
these apparently contradictory conclu-
sons by arbitrarily reducing the value
of the company's property as shown by
the uncontradicted evidence in the case,
to figure far below its actual cost and
far below what II would cost to replace
1t in its present condition. 1t then pro-
ceeds to arbitrarily reduce, on paper,
various actual costs of maintaining the
plant and furnishing the service, by maxi
ing various assumptions as to values and
costs which are not only not based on
any evidence presented at the hearing,
but which are distinctly contrary to the
uncontradicted evidence in the case.
"The majority of The commission then
present compilation of figures based
on these various assumptions which,
they argue, iustifies the reductions sug-
eested and which, they argue, shows how
the company might get six per cent
return on this theoretical investment. BY
carrying these assumptions stll fur
Their and by arbitrarily, on paper, reduc-
ing the value of the company's property
by so per cent. instead of by % per cent.
1t would obviously be possible to Justify
on paper, a still more liberal reduction
In the rates.
I Unfortunately for the company how
| ever, upon whom rests the actual re-
| sponsiblity of furnishing the service
| these assumptions 10 not help very
much in the actual conduct OF the
| business. If an article costs a dol
| lar, 1t costs dollar, and 1t
value is not changed by an ar
| bitrary assumption. on paper. that it
costs soc, and the fact remains that If
| the rate scheduled as proposed by the
commission had been in effect during
the year ending June so. 1913, the com
pany would have been left without
any margin OF profit whatever over
| and above the expense of furnishing
service in the State of Vermont.
Under these circumstances there
seem to be four possible courses open
to the company.
| ITO acquiesce in the majority de-
cision of the commission and under
| n 10 ha
business carried by the telephone us
ing public of the other States. We do
not believe that this Is fair to tho
other states. nor do we believe that
| the people of Vermont would wish to
have their telephone service upon any
such basis, Furthermore under this
proposition the company would be fur
nishing certain grades of service in
Vermont at lower rates than the com
pany would be charging for the same
grades of service furnished under
similar conditions In other States. The
company knows of no way in which 1t
could justify any such discrimination.
ION the other hand the company
should adopt for similar grades OF service
in similar communities I'm the other
States, the reductions suggested by the
majority or the commission, the agGre-
gate loss in the company's revenue would
more than wipe out the small margin now
resulting from the total business of the
company. This margin is already ga
small as to be source OF serious concern
and has already resulted in a temporary
postponement of certain improvements In
equipment and extensions of the plant
The third course omen to the company
would be to acquiesce in the majority de-
clsion Of the commission and undertake
to reduce the expense of furnishing serv-
ice in the State of Vermont to a point
commensurate with the revenue collected
I'm the State. This would not only near
"A permanent postponement of all improve
ments In equipment, plant and service
but 1t would result In an impairment II
the present service which would AFFECT not
only the telephone using public in Yer
mont but those In other states who have
occasion to use the toll service to and
from that State. This course or proceed
ure the company does not believe Is de-
sired by tho people I'm the state or Yer
lmont, nor can we believe that 1t would