The Barre daily times. (Barre, Vt.) 1897-1959, 1914-03-17
SAYS REDUCTION
is UNREASONABLE
Vice-Pres. Hall of New England Tel. &
TEL Co. Says His Company Couldn't
Earn One Per Cent. on Its In
vestment Under Proposed
Rate

Commenting on the order of the Ver-
mont public service commission to re.
duce rates on several classes of service
in his company, Vice President T.. X.
Hall of the New England Tel. 4 Tel. Go,
issued the following statement:
Never before in the history of the
New England Telephone 4 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 find
ing is one which the company is unable
to understand in view of the facts and
the evidence presented to the commits
sion.
In justice to the telephone using pub
lie in the state of Vermont and the
other states where the company oper-
ates, as well as in justice to the com
pany itself, the officers of the company
feel that it is their duty to appeal from
the decision of the majority of the
commission in this case and wish to
state frankly 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
a 2 per cent. return on the value of the
property located in Vermont. The re-
duction proposed by the majority of the
commission would practically wipe out
all of this net revenue.
although the commission admits in
its opinion that the company is entitled
to earn at least per cent, it under
takes to establish by the order of the
majority set of rates under which it
would be impossible to earn even | per
cent. provided the company continued
to maintain its plant and the quality of
its service.
'The majority opinion seeks to justify
these apparently contradictory conclu-
sions by arbitrarily reducing the value
of the company's property as shown by
the uneontradicted evidence in the case,
to figure far below its actual cost and
far below what it would cost to
replace it in its present condition.
1T then proceeds to arbitrarily re-
duce, on paper, various actual costs of
maintaining the plant and furnishing
the service by making various assump-
tions as to values and costs which are
not only not based on any evidence pre-
sented at the hearing, but which are
distinctly contrary to the uncontra-
dicted evidence in the case.
THE majority of the commission then
present compilation of figures based
on these various assumptions which
they argue justifies the reductions sug-
gested and which. they argue, shows how
the company might get 8 per cent. re-
turn on this theoretical investment.
by carrying these assumptions still
further and by arbitrarily, on paper, re-
ducing the value of the eompany's prop
erty by 80 per cent instead of 25 per
cent. it would obviously be possible to
Justify on paper still more liberal re-
duetion in the rates.
Unfortunately for the company, how
ever, upon whom rests the actual re-
sponsibility of furnishing the service,
these assumptions do not help very
much in the actual conduct of the busi-
ness. If an article costs dollar it
costs a dollar and its value is not
changed by an arbitrary assumption, on
paper, that it costs 80 cents, and the
fact remains that if the rate schedule as
proposed by the majority of the COM
mission had been in effect during the
year ending June 80, 1913, the company
would have been left without any mar
gin 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;
Il. To aequiesee in the majority de-
fCon.;,,,,1 - ..,,a - A