Opinion ID: 2332363
Heading Depth: 1
Heading Rank: 7

Heading: charitable contributions and legislative expense

Text: The Commission disallowed for ratemaking purposes $16,000 of charitable contributions and $1,000 of legislative or lobbying expenses. New England challenges the deduction of these sums from its operating expenses as being without support in the record. We find no error in the Commission's actions.
The Commission deducted $16,000 of charitable contributions from New England's operating expenses for ratemaking purposes. In so doing, the Commission adhered to its established policy that ratepayers should not be charged for these expenses and that the Company's contributions and involvements in charitable activities should be borne by stockholders. Re New England Telephone and Telegraph, ___ P.U.R. 4th ___, ___ (Me. Pub.Util.Comm.1977). This finding was based upon Staff witness Mr. Bruce M. Louiselle's testimony that such contributions were not related to and did not improve the quality of telephone service, that they were not necessary to enhance its goodwill because it was a regulated monopoly whose service area is protected by law, and that ratepayers should not be forced to make contributions through their telephone rates. We find that this testimony supplies a sufficient basis for the Commission's decision. The allowance or disallowance of charitable contributions as a ratemaking expense is inherently a policy decision. [38] The Legislature has appropriately vested the Commission with discretion concerning such matters. This Court cannot review the judgment of the Commission as to public policy or the discretion vested in it [by the Legislature]. In re Samoset Co., 125 Me. 141, 143, 131 A. 692, 693 (1926). Whether or not a utility's charitable contributions should be included in its operating expenses for ratemaking purposes becomes a question of fact for the Commission. This Court has no right to substitute its judgment on the facts for that of the Commission. In re O'Donnell's Express, Me., 260 A.2d 539, 546 (1970). The Commission's findings of fact, if supported by substantial evidence, in the record, are final. In re Powell, Me., 358 A.2d 522, 528 (1976). We find that the Commission's decision is supported by substantial evidence. New England argues that the Commission's action is erroneous because it allegedly fails to make a specific finding that the charitable contributions are unreasonable. It quotes language from our decision in Central Maine Power Co. v. Public Utilities Commission, 153 Me. 228, 136 A.2d 726 (1957), concerning promotional expenses: The question is whether it clearly appears that the expenses are excessive or unwarranted, or, stated differently whether expenses in excess of the allowance by the Commission are within the limits of reason. 153 Me. at 244, 136 A.2d at 736. From this statement New England argues that the Commission's alleged failure to make such a finding that the charitable contributions were excessive, unwarranted or unreasonable renders its finding erroneous. We find no such error. The Commission's disallowance of the contributions is equivalent to a finding they are unwarranted. Moreover, such findings as demanded by New England are implicit in the language of the Commission's decree. It is not necessary that the Commission express itself in the same language found in the above quotation. It is sufficient that it find, upon substantial evidence, that the charitable contributions are not proper as an operating expense for ratemaking purposes. Moreover, our language in Central Maine Power Co. is directed to the reasonableness in amount of an expense considered to be a proper charge to operating expenses for ratemaking purposes. The Commission had not disallowed all promotional expenses, but only that portion which it found to be excessive. Thus, we assumed, In general, promotional expense of the nature under discussion may properly be charged to operations. 153 Me. at 244, 136 A.2d at 737. There is no such general assumption in this case. Here the Commission found that the ratepayers should not be charged for charitable contributions made by New England in general. The proper amount of such contributions is not in question. Our language in Central Maine Power Co. must not be so taken out of context. [39] We conclude that the Commission's disallowance for ratemaking purposes of $16,000 of charitable contributions was a reasonable exercise of its discretion and supported by substantial evidence.
The Commission deducted $1,000 of legislative or lobbying expenditures from New England's operating expenses for ratemaking purposes. In so doing, the Commission adhered to its established policy of disallowing lobbying expenses. In rebuttal to New England's argument that the ratepayers may benefit from its efforts to influence legislation, the Commission stated, Clearly ratepayers may also suffer from the Company lobbying efforts. In Re New England Telephone and Telegraph Co., supra at ___. We find no error in the Commission's actions. As in the case of charitable contributions, the allowance or disallowance of lobbying expenses is a matter properly within the discretion of the Commission. We will not interfere with an exercise of discretion, where, as here, it is reasonable and supported by substantial evidence. New England again claims that the Commission failed to make specific findings that the lobbying expenditures were excessive, unwarranted or unreasonable. As we found with respect to New England's charitable contributions, there is no error in the Commission's actions under our decision in Central Maine Power Co. v. Public Utilities Commission, supra (1957). It's decree contains sufficient findings supported by the record. We conclude that the Commission's disallowance for ratemaking purposes of $1,000 for legislative expenditures was a reasonable exercise of its discretion and supported by substantial evidence.