The daily banner. (Cambridge, Md.) 1897-2008, 1920-06-09

per month for each residence Dub-
scriber. Service station companies
who rent their telephone sets from
the Telephone Company are increas-
ed from 81 cents to $1.25 per month
for each business station and from
81 cents TO 92 cents per month for
each residence subscriber.
The valuation placed upon the
company's property throughout The
state is the pre-war value, and car
ries with it no inflated value, and as
stated in the aforegoing, with these
Increased rates the company will only
be earning 1888 per cent in the
Maryland Elsewhere territory which
does not include Baltimore City.
In the previous telephone-rate
hearing the commission announced
that it would allow the company to
fix rates that would yield per cent.
as a fair return Since then the
valuation has grown, according 10 the
company's figures to SIT, POS, 535.
1t does not ask rates that will yield
per cent on this amount, not be-
cause the company is composed or
philanthropiStS, but because the Of
ficials figure that the amount asked
for is about all the public will be
willing to pay, and to stand on its
rights and charge 8 per cent, would
be to cause the removal of 80 many
telephones that a loss of revenue, in
stead of an increase would result.
The company bases its present ap-
plication upon the obvious necessity
of meeting its operating expenses
and interest charges. However,
considering the proposed rates from
the viewpoint of the return upon the
fair value of the property, the COM
pany submits that its proposals are
exceedingly modest.
The fair value of the company's
property in Maryland is $17,2OO,OOO
The value is arrived at by bringing
up to date the valuation made by the
Commission in 1914. Upon such
amount the company might claim,
with considerable justification in the
light of the precedents. the right to
earn a return of per cent. over Its
operating expenses. In other words
the company may fairly be said to
be entitled to earn in Maryland ap-
proximately $1,376,OO0 year over
it's operating expenses. The rates
now proposed by the company will
produce a net return of S90S,O0O a
year, equal to 5.21 per cent upon the
fair value of the property
Public regulation fixes the price
that may be charged for service, but
it does not keep the prlce of mater
ials down. The Company must pay
current market prices for the ma
ials required to maintain its plant
and equipment. Since 1914 the
average price of raw materials re-
quired to furnish telephone service
have increased 80 per cent.
But in spite of the burden of rls-
ing wages and increased cost of ma
terials, resulting in insufficient re-
venues, the company's whole effort
has been to maintain its equipment
at Bell System standards and i 70
furnish good service. NJ. sIEf-I
No public utility can feasonably
be expected to continue supplying
service at Inadequate rates; and
therefore, the company is now asking
for rates sufficient to pay expenses
and earn moderate return.
Failure by the company to meet
the situation by prompt and ade-
quate measures of relief would re-
suit in incalculable Inconvenience
and hindrance to the users Of the
service in the conduct of their bust
ness. The company proposes TO
meet its obligations to the fullest eX-
tent and has confidence that its
patrons will meet it half way.