Evening star., 1922-01-22
CONTESTS return
OF OLD PHONE RATE
Pre-War Schedule in D. c.
Would Be Unreasonable,
Says A. E. Berry.

WOuIu be UnTedSOfldDle,
Says A. e. Berry.
A return to pre-war telephone rates
at this time would be unreasonable.
unfair and would amount practically
to confiscatiOn, A. E. Berry, presi-
dent of the Chesapeake and Potomac
Company. told the utilities commits
sion yesterday afternoon at the close
of the hearing on the companys
rates.
Mr.. Berry asked the commission to
1922, estimating that they would yield
the company about SIS per cent on
the fair value of the property. The
president testified that while this is
less than the company believes it
should earn, it recognizes the fact
that rates high enough to give
or per cent return would have the
effect of driving away subscribers.
The Chamber of Commerce. repre-
sen.ed by Harry King and Arthur f.
Seymour, supported the company's re-
quest for a continuation of existing
rates.
FavOrs Some Reduction.
William Nick Clayton. speaking
for the citizens associations. told
the commission that while il might
not be proper to go back to pre-
war telephone rates. he believed
some reduction in the schedule should
be made in view "of the excellent
financial condition of this company
and the general downward trend of
prices"
Mr.. Clayton cited the fact that
street cars, gas and electric light
rates have been cut below the war
peak and he asked the commission
why ii should single out the tele-
phone company and allow il TO re-
tain wartime rates.
Osborne /. Yellott, counsel for the
company, devoted practically all of
his closing argument to the citation
of decisions by courts and commits
sions to support the company's con-
tention that its depreciation reserve
should be included in it's fair value
for rate-making purposes.
Briefly. the company's argument is
this: That money placed in the de-.
probation reserve belongs to the
stockholders because they have not
received what is regarded as a rea-
sonable return. If they had received
a reasonable return on the investment
and still been able to place something
in the depreciation reserve. then that
sum could be eliminated from the
fair value in fixing telephone rates.
Mr.. Berry testified yesterday after
noon that the company has postponed.
for the time being. installation of the
first automatic central office in wash
ington. number of large cities. he
said, will soon try out the automatic,
and the local company expects to save
money by awaiting the results of
the test elsewhere.
Rates In nfher (fffea
At the request of Chairman Keller
of the commission. the company
agreed to furnish the commission
later with the rates now in effect in
other large cities of the country.
Chairman Keller asked Br Berry
If the wages of operators were likely
to go down. The witness replied in
the affirmative. explaining that the
company expects to spend much less
on operators this year than during
1921
w. B. Clarkson, commercial superin-
tendent, testified yesterday afternoon
that the company now has about 391
untitled orders for service, whereas a
year ago the number was 574. The
company, he said, usually is able to
fill 95 per cent of the orders within
a week. The other per cent, he said.
represent applications from persons
whose homes are SO situated that faci-
lities are not Immediately available
At the conclusion of the hearing Col.
Keller thanked the company and in
tere$ted citizens for the manner in
which they took part in the discus
sions. He said the company had made
a complete and frank presentation of
all the matters on which the commits
sion asked them for information.
Decision probably will not be render
ed until some time in February, since
existing rates do not expire until
March /.
No progress has been made toward
the question of whether the Az per
cent of gross earnings paid annually
by local telephone companies to the
American Telephone and Telegraph
Company is reasonable.
A. E. Berry. president of the Chesa-
peake and Potomac Telephone. made
this statement yesterday at the rate
hearing before the public hearing be-
fore the public utilities commission.
Along withs other matters, the cons
mission is again inQuiring into the
reasonableness of this annual license
is exchange for the rental of equip
ment owned by the parent concern
and for expert engineering services
received from the American company.
Consideration Once Postponed.
In a previous rate decision the
local commission announced that it
would postpone consideration of the
An per cent license in view of the
suggestion Of the Indiana commission
commissions to settle the question in
q way that could be followed
throughout the country.
Walter c. Allen, executive secretary
of the local commission. asked Mr..
Berry what progress had been made to-
ward such settlement.
Mr. Berry replied that the tele-
phone company stood ready to go in
to conference with 4 committee rep
resenting the state commissions. but
that q number of those commits
sions have announced that they
ment and that to hold such a corr
ference would be a waste of time.
While c. A. Robinson, chief engin-
eer of the A. T. and T., was testifying
as to the benefits which local COM
panies derive from their afiliation
asked by Mr.. Clayton If in his opinion
an independent company could operate
successfully in Washington.
Mr., Robinson replied that he did not
believe an Independent company could
operate successfully here, pointing
ont that one of the big assets of an
sffiliated company is the long distance
! Mr.. Robinson was followed by e. ".
Cor. also an official of the A. T. and
n who was called to explain the adj
vantages Of the contract which the
local company has with the Western
Electric Company for furnishing sup
In one year, he testified. the c. and
p. Company saved Is per cent by buy
ing its telephone material, including
cable. from the Western Electric.
pruunnN Inpv FATS