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It is the intent of this order that all other rates, rules and regulations filed in Ill. C. C. 3, shall be the same as those filed in Ill. C. C. 2.

Section 3. That the Auburn Telephone Company shall set aside a monthly allowance of $206 to provide a reserve against depreciation, plus 6 per cent. of the cost of all annual additions that may be made to the plant of the Auburn Telephone Company on and after June 30, 1923.

Section 4. That all items of expense having to do with the upkeep of the plant shall be treated strictly in accordance with the Uniform System of Accounts for Telephone ('ompanies, now in effect by this Commission, proper attention being given to the apportionment between maintenance expense and expense due to depreciation of plant and equipment.

By order of the Commission, at Springfield, Illinois, this twenty-fourth day of October, 1923.

In re PROPOSED ADVANCE IN RATES OF THE QUEEN CITY AND SHELBY County MUTUAL TELEPHONE COMPANY.

Case No. 13492.

Decided October 24, 19:23..

Value Determined—Allowance Made for Construction Work in Progress

in Fixing Value—Increase in Rates Authorized.

OPINION AND ORDER. On July 23, 1922, the Queen City and Shelby County Mutual Telephone Company filed with the Commission Rate Schedule Ill. (. C. 3, in which it was proposed that the rates for telephone service in Shelbyville, county of Shelby, and vicinity, be advanced and in which it was further proposed that such advance in rates become effective September 1, 1923. It appearing from an examination of the said schedule that the Commission should enter upon a hearing concerning the reasonableness of the proposed rates, the Commission on August 13, 1923, entered

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an order suspending the effective date of the said schedule of rates until December 29, 1923.

All interested parties having been notified, the matter came on for hearing before the Commission on September 18, 1923, and on September 28, 1923, on which dates the Queen City and Shelby County Mutual Telephone Company and the objectors, the city of Shelbyville, were represented by counsel. Evidence pertinent to the issue herein was made a part of the record in the case. The present and proposed rates for the principal classes of service are as follows:

Annual Rates

Present Proposed Business stations

$19 20 Individual, business stations.

$36 00 Two-party, business stations.

30 00 Residence stations

13 20 Individual, residence stations

27 00 Two-party, residence stations

21 00 Business extension stations

600

9 00 Residence extension stations

6 00

6 00 Rural residence service

21 00

21 00 Switching service stations

6 00

9 00

At the hearing on September 18, 1923, the Queen City and Shelby County Mutual Telephone Company presented as evidence of record a valuation of the property made by using as a basis an inventory and appraisal of the property as of January 1, 1919, which inventory was priced by the use of average pre-war prices. The total valuation of the property as of January 1, 1919, on the basis above described was $43,368. From this valuation were deducted retirements from plant from the period, January 1, 1919, to June 30, 1923, in the amount of $16,580, and to the same was added additions made to the plant from January 1, 1919, to June 30, 1923, in the amount of $47,946, making the cost of the plant as of June 30, 1923, $74,734. The company has at this time considerable construction work in progress and the estimated cost of such construction based, to a large extent, on the actual con

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tract price, is $58,554. It is also shown that the construction work now in progress will enable the company to retire $16,765 worth of additional plant, making the net addition to plant now in course of construction, $41,788. Adding this figure to the plant and equipment in service as of June 30, 1923, makes the total physical property, including construction work in progress, $116,522. Working capital is estimated, at $3,924, making the total investment $120,446.

It appears from the record that only approximately $10,000 worth of the property listed in 1919 inventory will remain in service and is included in the cost of the plant as shown above, so that the figure presented by the company is practically the original cost of the physical property.

It is pertinent to call attention at this time to the fact that the Queen City and Shelby County Mutual Telephone Company is entirely rehabilitating its property and is changing its system from a local battery or magneto system to an up-todate common battery system, and that the cut-over from the magneto system to the common battery system will be made on or about October 1, 1923, and that it is the desire of the company to place the proposed schedule of rates in effect when the new class of service is furnished.

The company submitted as evidence of record a statement of annual operating revenue and expense for the year ending December 31, 1922, and has used the actual operating expenses of the company for the year 1922 as a basis for estimating the operating expenses for the future, although it is contended by the company that the cost of operation of the new plant will probably be somewhat higher than the expense incurred in the operation of the old plant for 1922. The total annual operating revenue, including toll and miscellaneous revenue, was $17,782. The total operating expense, excluding depreciation, was $12,288. Taxes amounted to $380, leaving available for depreciation and return on investment $5,114. Deprecia

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tion of plant and equipment is estimated by the company on a basis of 6 per cent. of the cost of the property shown by the valuation, exclusive of land, and amounts to $6,889 per annum, thereby resulting in a deficit of $1,775. The evidence shows that the application of the proposed increased rates will result in a net annual increase in operating revenue of $7,575, thereby resulting in a net annual income of $5,800 which is 4,82 per cent. on $116,522, the cost of the physical property.

The city of Shelbyville objected to the proposed increase in rates and considerable evidence was presented by citizens of Shelbyville stating their objections to the proposed rates.

The Commission having carefully considered all of the evidence of record in this case, and being fully advised in the premises, is of the opinion, and finds, that the application of the proposed rates filed by the Queen City and Shelby County Mutual Telephone Company on July 23, 1923, and designated as Ill. C. C. 3, will not produce an excessive return upon any fair value that might be placed upon the property of the Queen ('ity and Shelby County Mutual Telephone Company, and that the same should be authorized.

It is, therefore, ordered, That the Queen City and Shelby County Mutual Telephone Company, be, and the same is hereby, permitted and authorized to place in effect the schedule of rates on file with the Commission, designated as Ill. C. C. 3, covering telephone service in the city of Shelbyville, county of Shelby, and vicinity, effective November 1, 1923; and when notice of the effective date of the said schedule has been filed with the Commission, as specified herein, and the said schedule of rates is posted or filed in the office of the public utility, all as required by the Illinois Commerce Commission Act, and General Order No. 28,* adopted by the Commission, the said schedule of rates shall be the legal rates covering tele

* See ('ommission Leaflet No. 54, p. 21.

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phone service in the city of Shelbyville, county of Shelby, and vicinity.

By order of the Commission, at Springfield, Illinois, this twenty-fourth day of October, 1923.

In re APPLICATION OF THE ROSSVILLE TELEPHONE COMPANY

FOR AN ORDER AUTHORIZING THE ISSUANCE OF BONDS.

Case No. 13593.

Decided October 24, 1923.

Issue of Bonds Authorized.

OPINION AND ORDER. On October 9, 1923, The Rossville Telephone Company filed its application with the Illinois Commerce Commission for the consent and approval of the Commission to the issuance and sale by said company of $40,000 aggregate principal amount of its first and refunding mortgage bonds, to be secured by a mortgage or trust deed proposed to be executed and delivered by said company (said bonds and said mortgage being hereinafter more fully described). The matter came on for hearing at the office of the Commission in Springfield, Illinois, on October 17, 1923, and said company then asked and was granted leave to file its amended application herein for the consent and approval of the Commission to the issuance of its first and refunding mortgage bonds in the same amount specified in the original application and attaching certain supporting exhibits, including a copy of said proposed mortgage or trust deed. The petitioner having presented its evidence in support of said amended application and the exhibits attached thereto, and the matter having been duly submitted to the Commission for disposition, it appears:

That The Rossville Telephone Company, the petitioner herein, is a corporation duly organized and existing under and by virtue of the laws of the State of Illinois, with its

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