Evening star., 1934-07-01
CONSUMERS WIN
S|X-YEAR FIGHT
ON UTILITY RATES
Pennsylvania Commission
Orders Refund of About
100000.
Special Dispatch to The Star.
BY WALTER ID. ROOS.


HARRISBURG, Pa, June 30
Pennsylvania most famous utility
rate case has been won by consumers
in spectacular fashion.
Climaxing a S-year fight to reduce
sharply after locally Companies
were bought by outside capital, the
Public Service Commission has order
ed the Scranton-Sp -Springbrook Water
Service Co. to refund about $4,000. 600
to consumers. The decision affects
375 900 persons in Al municipalities
packed into 80 congested square miles
Of Northeastern Pennsylvania anthra-
cite belt, surrounding wilkes Barre
Unless the case is appealed with re-
sultant delays. the company also IS
required within so days to file new
rates which will reduce its allowable
annual revenue by more than $500 900
for an average year from the annual
revenue under previous rates. Placing
into effect for the first time its edict
of last Spring that utility earnings
will be limited to 6 instead Of 7 per
cent the commission also ordered the
6 per cent return to apply after July
/. 1888. The / per cent cut shaves
$170. 900 a year from the company's
allowable return, the balance being
accounted for by what the commission
considered excess earnings under the
per cent rule.
Important to Pinch0t.
1t was this rate case. more than any
other one factor. which enabled Gov.
Clifford Pinchot to return to the Gov
ernorship in the 1880 campaign on a
platform of more drastic control of
rates and utility operation.
Early in 1928, the Scranton Water
Co., serving the dense population in
and near the States third largest city,
and the Springbrook company, serv-
ing the territory surrounding nearby
Wilkes Barre. were bought by Federal
Water Service and merged. Sharp
rate increases followed within a few
weeks. Almost fourscore municipal
tiles and many individuals filed COM
plants against the rates at once.
Consumers organized. staged DEM
onstrations, and vowed they would not
pay the higher rates. The water sup
ply was turned of at homes of some
protestants. Father Curran, crusad-
ing priest of Wilkes Barre. marshaled
company, and led them by the hun
dreds to Harrisburg to lay their case
before the Legislature and the Public
Service Commission. which had begun
hearings in June. 1928.
Two years Of vigorous fighting had
acquainted the entire State with the
major facts of the water-rate fight
before the 1880 campaign opened.
Against this background former Gov.
Pinchot announced his candidacy.
Citing the Scranton n-Springbrook case
as the horrible example," he cam
psigned for lower rates and more
drastic regulation of utilities. He
blamed high rates upon the. Pubac
Service Commission, charging that as
then composed 1t was the cat'S.paw
Of the corporations.
Ma1OriticS in Luzerne.
In the neck-and-neck race in which
Pinchot won in 1880 the ma ajorities
which clinched his victory were fur
nished in Luzerne County, which
benefits from the new decision. After
his election the same case featured
legislative investigations of utility
companies and the commission in
1881 and 1882. New utility laws re-
suited, notably one which forbids
utilities from making rate increases
effective until the commission has
approved, formerly they became ef-
fective in 80 days, regardless of
litigation.
Since then, also, by expirations Of
terms and forced designations the
majority of the commission Pinchot
denounced as 1.-The cat's-paw of the
corporations" left office and Pinchot
obtained control of the rate-making
board. 1t was the revamped COM
mission which ordered the company
to cut rates and refund $4,000, 900.
The refunds ordered are for por-
tions Of rate payments since July |,
1928, in excess of rates in new sched-
ules the commission directed be filed.
The overpayments will bear 6 per
cent interest per year from time of
payment to repayment. The COM
pany is granted four years to COM
plete the refunds in quarterly
amounts, either in cash or by credit
upon bills.
In the six years Of litigation the
case has shuttled between the COM
mission and appellate courts several
times. A year ago consumers in the
Scranton district, who formerly were
served by the old Scranton Water
Co. settled their fight with the COM
pany by compromise. The decision
and the $3,000,0 900 refund applies only
to the consumers of the former
Springbrook company. which centers
in Luzerne County around Wilkes
Barre.