basis of, in general continued:

-

rate purposes, for- continued:

estimating requirements for depreciation and
return (Wis.)

....

PAGE

1169

made........982-983, 985-986, 1042–1043, 1076–1092, 1110

reproduction cost not sole measure for rate base,
cases noted

basis of, various items:

1081-1083

consolidation work, amount for, formerly disallowed
because of lack of proof, upon rehearing where
contract for such consolidation proven and items
entering into work shown in detail, allowed (N. Y.) 1050-1051
construction work in progress, not included in esti-

mate of reproduction cost (Ore.)..

...

1089-1090

1089

982-983

983, 986

going value, capitalization of past deficits as:
disapproved (cases noted) (Ore.)......
30% of tangible property included in estimate of
reproduction cost, in absence of evidence that
expenditure incurred, eliminated (Ore.)...... 1088-1089
land not used by exchange, excluded (Kan.).....
materials and supplies, allowance made for (Kan.)..
new plant not yet fully in use because of advance
construction, allowance made in part for (Ore.)..
organization expense, allowed in part by former order,
upon rehearing where additional testimony given,
company's figure permitted to be capitalized on con-
dition that amount be amortized over reasonable
period (N. Y.)..

overhead costs, not included (Kan.)....
pavements, cutting and relaying, underground con-
duits including allowance for, in absence of show-
ing that paving was actually cut for laying of
mains and thereafter replaced, not properly in-
cluded in estimate of reproduction cost (cases
noted) (Ore.)

unit costs:

1086

1051
982-983

1088

downward price trend for one year not indicative
of changes that would materially affect value
at end of that year (Ore.)..
fluctuation over period of years, discussed (Ore.) 1084-1085

......

...

108t

(C. L. 149)

VALUATION OF PROPERTY - Continued:

basis of, various items-continued:

PAGE

working capital, allowance made for (Kan., N. Y.) .983, 986, 1043
depreciation:

5%, deduction of, former estimate fully considered,

for period from date of appraisal to actual trans-
fer of property during which time properties were

operated, affirmed upon rehearing (N. Y.).................. 1049–1050
determination of, court decisions as to, noted....

WESTERN ELECTRIC COMPANY. See License Contract:
payment under: inventive.

WORKING CAPITAL. See Valuation of Property: basis of,
various items.

ZONES. See Exchanges. Public Convenience and Necessity:
invasion. Rates: basis of.

1080-1081

INTERSTATE COMMERCE COMMISSION.

In re PURCHASE OF PROPERTIES OF THE UPPER SANDUSKY TELEPHONE COMPANY BY THE OHIO BELL TELEPHONE COMPANY.

Finance Docket No. 3492.

Decided March 29, 1924.

Sale and Purchase of Property Approved.

REPORT.

The Ohio Bell Telephone Company and The Upper Sandusky Telephone Company, hereinafter referred to as the Ohio company and the Upper Sandusky company, respectively, on February 29, 1924, filed a joint application under Section 407 of the Transportation Act, as amended, for a certificate that the acquisition by the Ohio company of the telephone properties of the Upper Sandusky company will be of advantage to the persons to whom service is to be rendered and in the public interest. The Public Utilities Commission of Ohio has entered an order* approving the proposed acquisition and prescribing a schedule of rates effective upon the unification of the properties. A hearing has been had and no objection to the granting of the application has been presented to us.

The Upper Sandusky company owns and operates a telephone exchange at Upper Sandusky, Ohio, serving 998 subscriber stations. It also owns certain toll lines having an aggregate pole mileage of 39.3 miles. The Ohio company owns and operates exchanges and toll lines in the State of Ohio, including an exchange at Upper Sandusky serving 630 subscriber stations, of which 145 are duplicated by the Upper Sandusky company.

The Ohio company proposes to purchase all the telephone property of the Upper Sandusky company for $50,

See Commision Leaflet No. 146, p. 418.

[I. C. 000 cash, plus certain adjustments for additions to property account as provided in the contract between the parties made October 31, 1923. No securities will be issued to effect the proposed acquisition. An appraisal made by the appraisal engineer of the Ohio company, as of September 30, 1923, fixes the cost of reproduction new of the physical plant of the Upper Sandusky company at $206,634, and less depreciation, $149,261. For purchase and sale purposes, the Ohio Commission found the value of the property and other assets to be not less than $50,000. The estimated value of property to be retired is $21,207, and property additions necessary to effect the unification are expected to cost $18,404. It is estimated that the number of subscribers to be initially served by the Ohio company, after unification, will be 1,483.

The exchanges of the two companies are not connected, and non-duplicate subscribers of either company can not communicate with subscribers of the other company. Patrons of the Upper Sandusky company have no long distance toll connections. The proposed transaction will eliminate the existing duplication and will enable subscribers of the Upper Sandusky company to secure universal service.

At the hearing letters from the president and secretary of the Upper Sandusky Chamber of Commerce and other representative telephone users were introduced in evidence, all recommending that the application be granted. The mayor of Upper Sandusky states that he has no objection to such action.

The Ohio company is one of the so-called Bell companies. It is now, and after the consummation of the proposed transaction will be, subject to the Interstate Commerce Act.

Upon the facts presented, we find that the acquisition by The Ohio Bell Telephone Company of the telephone properties of The Upper Sandusky Telephone Company, as described in the application, will be of advantage to the persons to whom service is to be rendered and in the public interest. A certificate to that effect will be issued.

. L.. 149]

CERTIFICATE.

A hearing and investigation of the matters and things involved in this proceeding having been had, and said Division having, on the date hereof, made and filed a report containing its findings of fact and conclusions thereon, which said report is hereby referred to and made a part hereof,

It is hereby certified, That the acquisition by The Ohio Bell Telephone Company of the telephone properties of The Upper Sandusky Telephone Company, as described in the application and report aforesaid, will be of advantage to the persons to whom service is to be rendered and in the public interest.

March 29, 1924.

In re PURCHASE OF PROPERTIES OF FLORIDA TELEPHONE COMPANY AND EAST FLORIDA TELEPHONE COMPANY BY SOUTHERN BELL TELEPHONE AND TELEGRAPH COMPANY.

Finance Docket No. 3494.

Decided March 31, 1924.

Sale and Purchase of Properties Authorized.

REPORT.

The Southern Bell Telephone and Telegraph Company, the Florida Telephone Company, and the East Florida Telephone Company, hereinafter referred to as the Southern company, the Florida company, and the East Florida company, respectively, on March 3, 1924, filed a joint application under Section 407 of the Transportation Act, as amended, for a certificate that the acquisition by the Southern company of the properties of the Florida company and the East Florida company will be of advantage to the persons to whom service is to be rendered and in the public interest. The Railroad Commission of Florida has advised us that it approves the proposed acquisition. A hearing has been had and no objection to the granting of the application has been presented to us.