Evening star. [volume] (Washington, D.C.) 1854-1972, 1943-03-03
PUG Accountant
Faces Quiz on
Rate Data Today
Power Hearing Finds
5 Federal Agencies
Concerned in Case
BY DON S. WARREN.


company for seeking to reduce rates
too much under a frontal attack
by a whole battery of counsel for
Federal agencies for trying to keep
rates too high, and with civic spokes-
men divided on issues, but fearing
the worst either way.
The principal business scheduled
for this mornings session was cross
examination by Government at
torneys of v. A. McElfresh, chief
accountant Of the PUG, of four
calculations, offered late yesterday,
under which he showed how PEPCO
rates for this year might be reduced,
without what he called any funda-
mental change in the sliding scale
plan, by as much as either $242,O00
or $315,50O.
Here, Company Counsel William
K. Laws took exception, paving the
way for possible court appeal, say
ing that this would constitute
move beyond the scope of the hear
ing or otherwise a revaluation be-
yond the sliding scale plan, claim
ing there were elements of 'intan-
gible value" written into the 1924
consent decree which the PUG now
should not attempt to eliminate.
U. S. Units Represented.
Arrayed against the company
and the commission so far as its
majority had ruled the present case
must be limited to issues under
operation of the sliding scale agree
ment-were counsel for five Federal
agencies: The OPA, the Treasury
Procurement Division, the Public
Buildings Administration, Stabiliza-
ton Director James F. Byrnes and
the Justice Department.
In this regard it was noted bv
District Building observers that no
explanation yet had been offered as
to why the Justice Department had
entered the case at the last minute,
in view of the fact that Treasury
Department and the PBA already
had applied for intervention as
agencies dealing with power rates
paid by the United States.
The list of Federal agencies en-
tered as intervenors already had
grown SO long, however, that when
William R. Kueffner, special assist
ant to the Attorney General, told
the commission that the Justice De-
partment might wish to intervene,
the wish was granted without the
PUG waiting to know whether the
department would make active use
of the privilege.
Wender Backs Plan.
The PUG, on the other hand, was
not without a friend. Harry S.
Wender, president Of the Federation
of Citizens Associations, raised his
voice yesterday to proclaim the pub
lie value of the sliding scale arrange
ment and to voice fears of what
might happen if the threats of pub
lie neutrality-suspicious. by Thurman
Hill, counsel for the Treasury Pro-
curement Division-were carried into
force.
Mr.. Wender recalled that the Fed
Grafton was an original party to the
sliding scale plan. He expressed
fears that the private consumer
would suffer if drastic reductions
were ordered in Federal rates with
out regard to the position of the
householder. Also, he suggested
that if Treasury Procurement car
ried through with it's threats of
public ownership the result might
be that the Government would claim
the right to free power as it has
done, successfully, in the case of
free water on the grounds that the
United States had an investment in
the Districts water supply system,
years ago.
Mr.. Wender also remarked that
there were so many Federal attor-
neys interesting themselves in the
PEPCO case that attorneys for the
public could not find seat at the
counsel table, and that even the
corporation counsel of the District,
Richmond B. Keech, could not get
to the counsel table because all the
seats were taken. He used this as
one more argument for peoples
counsel before the PUG.
Company Counsel Laws, by means
OF many objections and noting Of
exceptions, indicated that the Nc
Elfresh move to adjust 1924 consent
decree valuations granted the COM
pany would be illegal. On some of
these issues Chairman Flanagan de-
ferred. decision.
Reduction Possibilities Shown.
Mr.. McElfresh started out with
a calculation that under a strict in
depreciation of the sliding scale plan
there could be no rate decrease.
However, he entered a second ex-
hibit under which only a normal"
Federal tax rate of 81 pei cent on
taxable income be charged to oper-
atlng expenses, showing POSSIBLE
ties of a $4,000 rate decrease.
He added to this over increasing
ly insistent objections from the COM
pany, that with a write down of
1924 property values on the basis
OF retirements of WORKOUT proper
ties, with prices trended, rates might
be reduced by $3l5, 800, if tax charges
were limited to normal levels, leav-
ing the company to pay the extra
layers of wartime levies.
In this connection it was brought
out that an eventual write down"
of $9,300,000 from the 1924 consent
decree value of $32, 100000 was in
volved in the rate base now pro-
posed by Mr.. McElfresh. Under pro-
posals advanced by the company
S2,158,000 of such write downs" on
property retirements already has
been achieved. Mr.. McElfresh pro-
poses that this sum be increased
as Of the end of the last calendar
year, to nearly $3,50O,0O0. This would
leave to be retired under the pro-
posed new schedule nearly $4,000, 900
Prince Georges Citizens
To Discuss Annexutions
Efforts nv variouS incornora ed