Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1917-02-15
HIGHSPRE WATER
GETS INTO COURT
Public Service Commission
Sharply Criticises Financ-
ing of Concern

The Public Service Commission. in a
decision handed down to-day by Chair
man Ainey. declares the rates of the
Highspire Water Company. operating in
the borough of Highspire. south of the
city, are excessive. and orders a new
tariff filed by March 1.
The opinion denounces the financing
of the company. declaring that a bond
issue of 100000 made Immediately after
purchasing the company for 1900. was
Outrageous"
The decision sets forth that the COM
pany was incorporated In 1901 and that
bond issue of $4,000 was made. SIS
600 being sold and the remainder used
as collateral. the revenue increasing
until in 1910 it was about $500. In
1910 David Gring acquired the COM
pany for $4,000 cash, the incorporators
getting about $500 tor their interest
in the property. 1t is declared that
almost Immediately" a bond issue of
100000 was authorized and that the
additional investments made since that
time for extension would not exceed
$1,000. 'Afte rthe first interest period
the inevitable default occurred in the
payment of interest on the bonds and
has continued to this day." says the
opinion. TT is also said that the pur-
chase price of $4,000 was considerably
in excess of the fair value of the prop
erty and that $4,000 is not in excess of
the actual investment to date. From
1910 to 1915 the property had a gross
income sufficient to pay reasonable
operating costs, provide for deprecia-
tion and leave a net return of not less
than six per cent. on its value. The
commission declines to accept q valua-
tion of s56.sS6.S9, made by an engineer
for the company, saying some charges
are not based on substantial grounds
1t is also stated that the commission is
convinced from the testimony that
nothing should be allowed for going
value in the sense that it is used by
the company saying The capitalizing
/ OF accrued deficits where such deficits
are figured on estimated investment
partially estimated gross earnings and
| operating expenses estimated so as to
directly contradict all the testimony
in the case will not be sanctioned by
the commission"
The fair value for making pur-
poses as of April l, 1916, is not in en-
| cess of $4,000. it is held, and the legit-
should not exceed $3.50 per year and
| that until the present mana cement Sc
cured control 1t was generally about
500 per year 1t is declared that, by
careful management the revenue can
be increased and no allowance should
be made for the 100000 bond issue
taxes. and that S100 should cover "all
fair charges" of the company.
The commission orders the Jenkins
Township Electric Light, Heat and Pow
er Company to stop exercising any
rights in Jenkins township, Luzerne
county, until it secures certificate
from the commission. The decision re-
verses an order it made on December
Il, 1915, and that the company is a
| proposed public service company
which must secure a certificate"
In an opinion by Commissioner Ryan
the Central District Telephone Com
pany, operating lin Western Pennsylva-
mia, is ordered to continue telephone
service to the estate of w. j. Rainey,
Uniontown. The compIainants alleged
that the telephone company discon-
tinued service to a switchboard and
line owned by them in May. 1915 the
telephone company declaring that it
refused to renew a contract because
| it was not in accord with rules and reg
ulationS.