The Lake County times., 1921-05-05

EDITION FOR
PHONE RATES
Hammond Takes Initiative.
Other Cities Expected Soon
To Follow.

In desire
/ AS possible from the excessive Iase7
now charged by the Illinois Ben 4e'e-
4 nhone Co.. the city OF Hammond mas
I ,a}ren tha initiative and has nled pc
I tt+tou With the Indiana Pubic Service
/ ,-on,r,isafon asking for rehearing OF
/ the rate case.
Otber cities of the Calumet region
are expected 10 take similar action
soon.
/ The petitioa as nIed at indianapolis
l.v Cit,- Attorney w. ". McMahon sets
o,t nfteen specific instances In whlch
tho commission is said To have erred
AS granting the increase in tolls ana
local rates. A strenuous objection is
raised TO the action OF the body IN
accepting its engineers report on
,-a1rat4on Of the compauy's properly
when as matter Of fact the report
was not based on his own investiEa-
lions but upon figures furnished him
by the company, The city had accept
ed his report before II was learned
that it was not really his own
Several paragraphs are devoted TO
the different features OF estimates
which were based on prices Of ma
terial and labor at wartime levels
when fl fact those prices are much
lower new and were lower at the time
Of tho hearing DcGciency IN earnings
during the war. the petition clros,
should not be considered in fixing the
ne wrate because the government
compensated the telephone company
for any losses incurred under govern
ment control.
That the telephone company spent
$1,000 in canvassing and $4,000 IN ad-
vertlsing during the first seven months
Of 1920 at a time when it claimed to
be running at loss is cited as evil
dence OF inefficiency on the part OF
the management because the advertls-
ing was not used to increase business
bug as propaganda in favor OF tncreas-
ed rates Another unwise expenditure
was the $4,000 used IN schooling oper-
ators whereas eighty percent of this
could have been saved. 1t is said. by
proper physical and mental tests OF
applicants.
The action OF the commission In al
lowing the American Telephone &
Telegraph Co. four and one-half per
cent Of the gross revenue Of the tele-
phone company as license fees is held
to be unlawful because such fees can
be purchased IN the open market for
3
phone Telegraph Co. Is actually the
sole owned OF tho local concern.
Determination against the Indiana
district IN favor OF the Chicago dis
trict on the matter OF apportiouinE
toll income among exchanges. A large
1 percentage Of the tolls originating in
Hammond IS absorbed and applied 60
increase the toll income of the Chi
cago district. 1t Is further pointed out
that the commission erred IN cons der
ing the Indiana district as a separate
and detached unit OF the Illinois Ben
4 Telephone Co. and raising the cry OF
running at loss in this small unit
whereas the company's business as
whole shows a fair net income ana
profit.
It Is furrner SHOWN that the Amerl-
can Telephone and Telegraph had a
Target net income in 1919 and 1920 as
shown by It's own reports and that It
Is wrong for the commission to con-
slider the Illinois Bell Telephone Co.
as q concern distinct from the larger
company.
The petition sets out that one large
1 exchange could handle the business OF
| Hammond. Whiting. East Chicago ana
Indiana Harbor but that separate ex-
changes are used in order that the
company may exact a toll charge be-
tween these cities and even parts Of
the city Of Hammond. Thus residents
Of RobertsdaIe must pay the toll
charge IN order to speak with phone
patrons Ia othe rparts OF the city or
Hammond.
The closing paragraph calls atten-
tion to the refusal Of the commission
ers to consider the valuation of the
company's property in Hammond as
liked by the Indiana State Tax Board.
Instead the comDany's figures which
were much higher than the valuation
on which they are paying taxes were
used.
No intimation has been made by the
commission as to when the matter win
be set for hearing