The Red Cloud chief., 1919-05-08
Renders Decision in Local
Telephone Controversy

A certified copy oil order OF the NC
braska State Railway Commission in
re-Formal Complaint No. $50, Lewis
III. Blackledge, ct al VS. Farmers In
dependent Telephone Company of Red
Cloud and Lincoln Telephone e. Tele-
graph Company, and received here
the first of the week, covers some
seventeen pages of type written
copy. The first part of the same is
devoted to the history of our little
city and county, together with that
of the two exchanges in controversy
reciting at some length their origin,
rates, difficulties, etc, from the be-
ginning up until the present time, all
of which has previously been given
considerable publicity, in days past,
with nothing to be gained by their
reproduction in these columns.
Prior to the order, itself, which
follows the official document states:
"The Commission is of the opinion
that it lacks power to order a physi-
cal consolidation of the properties.
1t would require comparatively little
material and labor to make the two
plants one, as the two exchanges are
less than five hundred feet apart.
The Commissions engineer estimated
the cost of running all the wires into
the Farmers Company's exchange
and providing additional switchboard
facilities at $2270 and the Lincoln
Company's exchange at $2518, with
no allowance for salvage values Of
property displaced. However, consoli-
dation requires a single control and
management of both properties in or
der to successfully operate them as a
single system. 1t requires taking the
control and possession Of one of the
properties from the owner and plac-
ing it with the owner of the other
property, or placing the control and
possession of both properties in u
body of trustees or in new corpora
tion created for the purpose.
''It is obvious that duplication Of
tNltDiloh' ubiilito III a.
such as we find here, is not desirable
from any standpoint, even though an
interchange OF service be provided
between the subscribers to the two
services, and with monthly rates OF
pay. There is the impediment to
messages due to passing through two
switchboards, and if rates are to be
made sufficient in amount to operate
and maintain both plants, and pay q
fair return on their value, many per-
sons desiring the service will be pre-
vented from getting it because of
financial inability. Such situations
usually prove disastrous to the own
ers of the plants involved, as the
rates necessary to financial success arc
greater than the traffic will bear
The additional limitation upon rates
then comes into play, namely, the
value of the service, measured not by
its value to certain individuals users
possibly few in number, but to the
whole body of people who are in
reasonable need of the service, and
rates established on such a basis are
not likely to be compensatory. A
utility's first duty is to give service
to those in the community occupied
by it that are in reasonable need of
the service, and il will not be heard
to say that the maximum rates such
persons are able and willing to pay
is not compensatory.
"The Commission regrets that it is
unable L. order a physical consolida-
tion CT ,he properties involved herein,
but it has power to order an inter
change of service between the two
plants. The interchange will require
the installation of at least two addi-
tional trunk lines between the two
exchanges and the employment, of
at least one and possibly two addition
al operators by each company. The
subscribers rates will be increased
sufficient to cover the cost of the uni
fled service, including a return upon
the additional plant necessary.
"The additional property necessary,
according to the record, consists OF
four metallic circuits, five hundred
feet long, with which to connect the
two exchanges, and the Commission's
engineer estimates the cost of these
'ciiDuits, including connections with
the switchboards, at $50. Nine pei
cent of this cost for maintenance ant
depreciation and seven per cent fol
return, or $3.50, constitutes thu
annual charge on account of property
Assuming that four additional opera
tors are necessary 1.-TWO for each com
pany,) the allowance for this pur
pose is $3.50 per operator per annum
or 1920, making the total annua
cost of the unified service Sl92S. Thi
is for division among 12i busines
subscribers, 404 residence and farr