Telephone Company Asks Authority To Revise Rates In Utah Announcement was made today that The Mountain States Tele phone and Telegraph Company has asked the Utah Public Service Com mission for authority to revise certain cer-tain exchange and toll telephone rates In Utah to enable the Company Com-pany to meet Increased operating expenses and improve net earnings sufficiently to attract the addition al capital that is required to continue con-tinue its program of expansion and improvement of its service in the state. The Company states that although al-though it la handling the largest volume of business in its history of operations in Utah, its earnings on its Intrastate investment in telephone tele-phone plant are lower than at any time since World War I at an annual rate of 3.8 percent on a going go-ing basis. The present low earnings situation situa-tion is brought about by expenses increasing faster than revenues. Labor costs which comprise 63 percent per-cent of total expenses have been the largest source of increased costs of doing business. Wake rates have Increased substantially during and since the war due to adjustments comparable to those made in other industries of similar skill Labor costs now consume 69 cents of each revenue reven-ue dollar, compared to SS cents in 1M1. The cost of nearly everything the Company usee in constructing and maintaining its plant and service ser-vice is substantially higher. Some of the items listed by the Company were poles which had increased 64 percent; copper wire 83 percent, and lead covered cable 104 percent. The Company states that during the war the extnslon of its plant wu limited to project that were essential to the war effort and public pub-lic health and safety, and that since V-J Day the demand for service ser-vice has been so great that It has not been able to restore the ore- war margins in Its plant that are necessary for efficient operations and satlsfactosy service. Despite the fact that it has carried out the largest construction program in the last two years ever under-taken In the state, about $7,000,000, and gained nearly 63,000 telephones, a 23 percent increase since V-J Day, there were on October 1, 1947 nearly 11,000 orders which could not he completed because of lack of facilities. facil-ities. The company's engineers estimate es-timate that in order to take care of present orders on hand and to Te tore normal margins in plant and provide for replacements and offered business during a five year period ending 1951, that a gross construction program in the order of 124,000,000 will be required. The Company points out that the new capital required for this program will not come from the increased revenue requested in the revision of rates. All of that will be needed to maintain good service to meet operating expenses and interest in-terest and dividend requirement. In order to attract the additional cap!, tal that will be required, earnings will have to be at a rate that will make investment in the business at-1 tractive. The proposed new rates would increase the Company's total rev-i enues in Utah by pjx oxlmately 176,000 a month. Since Federal and ' other Income taxes would take 40 percent of this amount, monthly! net earnings would be improved by 1 about $45,600. The effect on individual indivi-dual customers will vary considerably consider-ably and will depend on the type and the amount of service they have and the exchange from which, they get locuj service, Tt0 last general adjustment of telephone rates' in Utah was in 1938, most of the adjustment at that time being decreases. la general, gen-eral, present telephone rates in Utah are the same or lower than rates established in 1922. The proposed exchange rates are designed to recognize that there is some varatlon in the value as well as the cost of the service with the number of telephones In an exchange. ex-change. The present Intrastate toll schedule at varying distances, and form more nearly to the interstate schedule at varying dlstancs, and to provide about one-fourth of the necessary revenue. I