The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1917-01-02

operating expenses that unfair or ex'
cessiye returns result, the commits
sion has the power to make a reduc-
ton in rates, and will not hesitate to
do so. ~ T.,
At the hearing committee repre-.
senting tho DIRECTORS appeared and
stated their case I'm fair and un'
prejudiced manner. While the pro.
test went directly to the increase Of
rates for the main reasons stated
above. yet it was conceded that tho
object OF the protest was to bring on
for Investigation the real question at
issue, to.wit: Whether as matter
of right the company Is entitled to
the increase asked for The object.
ors conceded that 1t was the part OF
wisdom for the company Mt this time
to incur the additional expense OF
laying its down town wires under
ground; the removal Of unsightly
poles from the main streets OF "a
prosperous and rapidly growing city
is always a thing to be desired and
all the patrons OF the company are
glad to SEQ this brought about at this
time, Just before tho entire down
town section OF the city is being pay
cd, because ut a later date the addi-
tional cost would be practically pro-
hibitive, no matter who has to pay
for 1t.
III determining a matter Of this
kind, 1t must be remembered that 4
public utility regulated and controlled
by II public utility commission Is IN a
sense a monopoly, and that competi'
ton is not only prevented by the fact
Of such regulation, but Is actually pro-
hibitcd by the clause Of, the statute
enjoining Il duplication of service.
However, it. is not Objectionable that
II public utility is monopoly when
it's methods, practices. and manage.
ment are supervised by public author.
tiles and even its rates. charges and
service, regulated. A puolic utility on
one hand Ia not permitted, to earn .ex.
ccssiye profits with which to ,declare
abnormal dividends. or with which to
make extensions, or improvements. se'
cause such procedure would. be per-
hitting the utility to build up its cap
ital stock from the contributions
made by the public aud then require
tho public to turn around and furnish
more earnings with which to pay div.
idends upon tho stock already donat'
BY the patrons. On the other hand,
It is the duty Of the public author-
ties to permit the utility to earn such
dividends as will not only keep up
tho plant in the condition in which !:
originally existed, but also to furnish
fair return upon the money invest
cd in the property Of the utility. and
hence a nice balance must be pre-
served by tho delegated authorities
on the one side. in preventing excess
sive earnings with which to pay div
idends in excess Of what is reasona.
Die. or with which to build extensive
or permanent improvements. and on
the other side in permitting sufficient
earnings 70 prevent deterioration Of
the plant and lessening Of the service.
hut at the same time to furnish fair
return upon the investment, 1t is
manifest that ifrit cost the North Da-
kota Independent Telephone Com.
panS $la.oW to put the wires Of the
Bismarck exchange under ground. this
sum must be furnished by the stock
holders Of the company. In other
words. that these improvements must
be paid out of new capital furnish
ed for that purpose and not out Of
previous earnings. In fact, the COM
pany is 40, supposed to have any pre-
vious earnings. and not permitted to
have undivided profits Or surplus ac-
cumalated foe. the purpose of extern
sions and improvements as is the case
with banks or other private corpora
tons The company then having fur
nished $ls,e00 Of new capital with
which to make this Improvement. the
question arises, how are they to re-
ceive an adequate return from this
additional Investment And the, first
question is to determine whether the
earnings which they new make from
shesr plant would be sufficient to
amount to = fair return upon the to-
;af valuation of the plant Is improv-
ed, or whether additional earnings
must be granted for this purpose. As
part Of the showing made by the com
paly at the hearing in this matter.
there vas filed with the commission
statement OF the earnings and ex-
penses At the Bismarck exchange for
the year lslS
The telephone companies Of this
eoansrr are all required % keep their
AockS according 10 method prescrso-
ed by the Interstate Commerce Con.
mission and by the State ComnS-
sion<s for Instance under the head
ING. Operating Expenses, are found
Subdivisions As follows, Carreas
Main,enSnce Includes keeping up r-
pairs Of plant. Including such isens
rs clearing l<cai troubles and taking
care az such items as xocM result
in maintaining the service without
making any change Of Plant values,
with the exception cf minor repair
parts. rraHe Expense iaci11es op-
orators salaries. light, heat, etc in
Connection With nailfaiEia& the cen
sral once, Commercial Npeases In.
clnGe salaries an once expeAees for
tie manasQ Who handles that woRk