Laurel outlook., 1950-04-26
TELEPHONE COMPANY
ASKS RATE INCREASE

L oShCo IlC PQOliN oCl WV SOiiiilll0
? sion for authority to revise GER
tain exchange and toll telephone
rates in Montana. In a petition tt
the commission, it vas explained
that the revisions necessary
to enable the company to meet in
creased operating expenses and tt
improve earnings to attract capita
into the business. This additions.
capital can be obtained only if
present owners of the business and
prospective investors can be as
sured of reasonably adequate earn
ings.
The company's petition to the
commission stated that the maxi
mum increase on main business
telephones would be about five
cents a day and the maximum res
idence service increase would not
exceed two and one-half cents a
day. Increases in rates and charges
for other services and equipment in
keeping with the increased operat-
ing expenses and the requirements
for additional revenues were also
requested. 1t was pointed out that
except for moderate increases re-
sulting from the reclassification of
some towns due to growth the 194S
changes affected only urban bust
ess rates and interstate long dis
lance rates. There has been no in
crease in the level of residence
telephone rates in Montana since
1925. Residence rates were not in
creased in 1913. Actually, due to
general rate reductions in 1886,
residence rates in 70 Montana ex-
changes are less now than they
were a quarter of a century ago
III 1925.
Meanwhile, the value of the
service to individual subscribers
has increased, the petition pointed
out, since the number of telephones
in the state has almost doubled in
the last 10 years. There were
1920 company telephones in serv-
ice on January l, 1910, and 12O,O53
on March 1, 1850.
Most of the growth has come in
postwar years after materials be-
came available following wartime
shortages. Since September 1,
1915, the postwar construction
program has provided 1896 addi-
tional telephones-an increase of
about 60 per cent and 1924 addi-
tional miles of long distance cir
increase of II per cent.
To accomplish this required gross
expenditures of over $4,000, 900 in
Montana since the war ended. The
program required the addition of
III employes-an increase of 70
per cent. During the same four and
One-half years, the investment in
physical properties of the COM
1anies has been increased 40 per
Demand for service continues
and the 1850 construction pro-
sram calls for an expenditure OF
Y, 100000. Further additions esti-
mated to cost in excess Of $7,000,-
100 will be required to extend ur-
AN and rural facilities, to reduce
ne number of people on urban and
ural lines, to extend service to
not now reached and to add
D long distance facilities in the
The company points out that the
ew capital required for this pro-
ram will not come from the in
reased revenue requested in the
evision Of rates. All OF that will
2 needed to maintain good service,
, meet operating expenses and
day to day requirements of
lie business. In order to attract
lie additional capital that will be
earnings will have to be
a rate that will make invest
ent in the business attractive.
Postwar construction and new
instruction planned represent
SITS substantially over 1910 levels.
)me examples were cited by the
mpany. Poles r up ~ per cent;
121 per cent; cable 60
r cent; copper wire 81 per cent;
80 per cent; and in
alters trucks 100 per cent.
In addition to higher material
SITS, telephone wage rates have
creased substantially in the past
years. A total of nine upward
lge adjustments have been made
Montana since 1910. 1t is esti-
ated that these adjustments
ded $2,2O0,000 per year to the
mpany's intrastate operating ex-
nSeS haSad on tho pracap+ e;1o