Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-29
UTILITIES DEPOSIT
PLAN |SATTACKED
Decision in Case Here May
Affect Custom Through
out United States.
BY GEORGE 4. DOYEN0.

The universal practice Of public utili-
ties In requiring their customers to
make cash deposits OF otherwise estab-
lish credit as a guarantee that bills for
service will be paid may be passe1 upon
by the Supreme Court Of the United
States.
A petition for writ Of certiorari has
just been filed with the court by e. C.
Riegel of this city, who objects to an
order issued by the Public Utilities
Commission of the District Of Column
bia approving the practice, and alleges
that it is discriminatory.
II the Supreme Court should agree
with the petitioner In this case-which,
however, Is not considered at all prob
able-the plight Of public utilities
throughout the United States would be
hazardous In the extreme, barring only
the telephone companies, which have q
fixed monthly rental payable in ad-
vance.
Commissions Order.
The electric, gas and water utilities,
however, are obliged to render service,
the quantity of which Is not known in
advance, then present a bill at the end
of a month and wait 10 or Is days for
the customer to pay. II the customer
should fail to pay, there would be no re-
course, in the absence of q deposit, but
to discontinue service-and even that
would not necessarily result In payment
Of the delinquent account.
Mr.. Riegel asserts that the act of
Congress creating the District Public
Utilities Commission expressly forbids
discrimination by a public utility. In
this respect the act Is substantially the
same as. those of the States which have
similar commissions.
The district commission issued an
order providing that applicants for
service shall be required to make o de-
post unless they establish their credit
to the satisfaction of the company. The
amount Of the deposit required shall not
exceed the estimated bill for two
months, service. except where such
amount Is less than IS the deposit shall
be So
Practically the same rule prevails In
every State, whether by express au-
thoriZation Of the State commission or
otherwise. In many instances the own
ership OF real estate in the city Is ac-
copied as an adequate guarantee, and
in other cases the Endorsement of an
other customer with established credit
is accepted by the utility
Mr.. Reigel, however, declares that
those least able to make deposits are
the ones imposed upon most, and great
hardship results to poor people" He
takes exception to the attitude of the
commission, when it said:
Guarantee Against Losses.
Losses due to uncollectable bills are
treated as deduction in determining
the amount available to pay q return
on the value Of the property of utili-
ties; consequently, those who pay their
bills, in effect, also pay the bills of
those who fail to pay. It Is, therefore
in the public interest that losses on bad
accounts by utilities be held at a mini
mum. Guarantee against any such
losses is only provided by full prepay
ment, but in the case Of metered or
measured service such prepayment is
difficult to carry into effect and would
be more Of an inconvenience than the
payment Of deposit rs q condition to
giving service"
THE commission" says Mr. Riegel's
brief, seemed to jealousy guard the in
terests of a So-called financially respon-
sible group who might be adversely af-
fected by the default of a Hypothetical
and underlined group but did not carry
its logic to the ultimate, which Is that
the so-called responsible group, being
unguaranteed, OF necessity defaults
more than the depositing group, which
cannot default, and the process of ex-
acting deposits is not only discrimina-
tory upon but prejudicial to the de-
positors If, as the commission argues,
the defaulters influence rates."
tCopyrieht. 1917