Opinion ID: 1907714
Heading Depth: 3
Heading Rank: 2

Heading: Was the commission's treatment of the gain on a sale of utility property proper?

Text: In 1973 the company sold certain utility property to Algonquin Gas Transmission Company. The sale resulted in a $528,855 gain to the company. In a 1973 rate proceeding the company treated the gain as a below-the-line item. In the instant proceeding, the commission recognized the inequity of such treatment and ordered the company to amortize the gain above-the-line over a 24-year period. Such treatment would reduce the cost of service to the consumer by $22,000 annually. The company does not seriously contend that such a gain should be treated as below-the-line income. However, it does maintain that the transaction was part and parcel of an earlier rate case, is not part of the present test period, was tacitly approved by the previous case, and, accordingly, should not be considered by the commission in the instant case. In FPC v. Hope Natural Gas Co., 320 U.S. 591, 64 S.Ct. 281, 88 L.Ed. 333 (1944), the Supreme Court noted: The rate-making process under the Act, i. e., the fixing of `just and reasonable' rates, involves a balancing of the investor and the consumer interests   . Nor is it important to this case to determine the various permissible ways in which any rate base on which the return is computed might be arrived at. For we are of the view that the end result in this case cannot be condemned under the Act as unjust and unreasonable from the investor or company viewpoint. Id. at 603, 64 S.Ct. at 288, 88 L.Ed. at 345. With these guidelines in mind, we find the commission's treatment of this item eminently reasonable and conducive to a fair end result. To decide otherwise would elevate procedure over substance at the expense of the consumer interest. Moreover, the company presented no evidence that the propriety of including the gain below the line was even mentioned at the prior proceeding. All in all, we have no hesitancy in upholding the commission's present treatment of the gain.