The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-02-22
UTILITY GROUP
FAILS REP0RT
OF COMMISSION
Write-Up Figures Cited Un-
dependable, Edison InSti-
tute Says.
BIZ Times Specinl

NEW YORK, Feb. 22.-StatementS
contained in news releases and re-
ports to Congress of the Federal
Trade Commission, relating to the
commissions eight-year inquiry on
the public utilities, are branded mis-
leading and inaccurate by Bernard
F. Weadock, vice president and
managing director of the Edison
Electric Institute, in an article pub
lished in the February issue of the
Edison Electric Institute Bulletin.
Many of the statements, reflect
ing upon the character and integ-
rity of the various State Public Util-
ity Commissions, are unreservedly
and unqaulifiedly false" Mr.. Wea-
dock asserts.
Deploring the "Subordination Of
facts to political eXpediency' by the
commission, Mr.. Weadock discusses
in particular two recent news re-
leases of the commission dealing
with utility ''writeups" and reaches
the conclusion that the contradic-
tons in the presentation of it's fig
ures renders them indispensable.
yet" he says, "the public and some
public officials freely use these
'writeup' figures as dependable, re-
liable and accurate"
Points to Discrepancy
Pointing out that a large discrep-
ancy exists between the two re-
leases, one dated Feb. purporting
to show write-upS of 226 per cent
in value of fixed assets of 81 Oper-
ating companies and the other dated
Jan. 10 purporting to show write
VI of 342 per cent by 81 operating
companies, that the 81 companies
are only partly operating companies,
and that further discrepancies exist
between the second release and the
printed report sent to Congress, Mr..
Weadock asserts that this juggling
confirms the unreliability of the
commissions own figures.
1.-The Edison Electric Institute, :"
Mr.. Weadock writes, In an ef-
fort to reconcile the figures pub
lished by the commission, has made
detailed study of all the published
reports of the commission relating
to the power inquiry, including teS-
timony, exhibits and statements. No
picked samples of operating COM
panies were chosen to be mixed up
with holding companies, nor were
any companies omitted that had
been examined.
Had the commission made COM
plete, full and fair analysis Of all
the operating companies examined
by them, the net result would have
been a total write-up of but IL per
cent of total assets. Is there any
industry or business in the United
States that can show such small
proportion of 'write-ups' over the
last half century of rising values,
using the same basis for their de-
termination?
In contrast to and in apparent
disregard of the decisions of the
United States supreme Court, the
commission has repeatedly stated
that these so-called 'write-upS' af-
feet rates when regulatory bodies,
which from actual experience are
more familiar with the subject,
know that it does not. In regard to
fair value OF utility properties and
the reasonablenesS of the rates, the
commission from the beginning had
stated that it's examination does
not purport to go into questions of
the fair value of the property OF
these public utilities ii. E., the oper-
ating companies) or of fair value
of return or reasonable rates for
services rendered . which would
have required among other things
an appraisal Of all the property OF
the utilities in question:
cat no point does the commission
contend directly Or indirectly that
the relation of value upon COM
pany'S books is an unlawful act. The
reflection of the value upon the
books was in most cases an exercise
of honest judgment and done in
compliance with the provisions of
law relative to it. The commission,
however, seeks to cast reflection
upon such entries by stating they
were based on nothing more than
optimistic judgment of the values of
the properties being unified
Again, it apparently ignores the
economic advance of the country
toward the period Of its greatest
growth. Many of the 'write-ups'
complained of occurred more than
20 years ago, and few we're within
the last four or five years. During
the depression years in business,
write downs'-n 'write-ups' are
the rule"