| Show Army's Rate Attack n On O U. U UP P. P L L. L M. M Moves oves' oves To Ta Livelier Front j Set to to et-to E Evidence Evi- Evi Opens Way to dance dence of Service Fees Fee k P Paid id Bond Share Shar are Sh-are Co T The army's attack on the rates pf of Ac the Utah Power Light Co rates rates at which which the war depa department r p e- e claim are are- based on a val vat in ine excess of true the the true swItched figure switched to tOI a new and live live- tier er front before the state public utilities commission Saturday After a spirited set to with co coun counsel rosin rosin- tin sel set for the utility I the the governments government's attorneys were permitted per to introduce introduce intro intro intro- duce evidence as to service fees paid the le Electric Bond Share corporation corpora- corpora i Lion tion on salaries paid Utah Pow Light Co officials financial relations between the defendant dant company company and the Utah Light 8 Traction company and md other elements of the padded added rate b base c. c P Attorneys Fence Colonel Hugh Colonel Hugh C. C Smith Ninth area rea judge advocate presenting the governments government's request for a a- 10 per ent reduction in power rates rt i iD Douglas Jouglas D and George R. R and A. A C. C Inman attorneys for the Utah Power ower Light Co fenced re repealed repealed- ed ly y over the materiality of the thc dence The government however won every very encounter when E. E E E. E Co Conman Corfman Con Corf- man chairman of the commission overruled objections of ot the utility company's attorneys G. G M M. Gadsby president and general general genral gen gen- eral ral manager of ot the Utah Power Light Co took the stand as ns the bearing hearing hear hear- ing ng opened and the l legal gal skirmishes were the outgrowth of admissions Colonel Smith sought to elicit from Mr Ur Gadsby what Gadsby-what what the Colonel frankly franky frank- frank ly y declared to be unnecessary fees paid by the utility to the parent concern con con- em cern cern the Electric Bond Share cor cor- Acco Accountant Testifies J After Alter pages of the federal feder l trade commissions commission's report had been cited by army representatives to show the be bei i C Ck k krate rate base of the Utah Power Light company t to be inflated b by I IT T T. E. E Thain accountant for the public utilities commission t testified as to the effect this inflation had on on the company's earnings jn pi fl 1932 The company reported earnings of ot per cent on on its fixed fied capital of he said If the the inflation or water water in m the fixed capital account count i is is deducted the earnings for for- 1932 would be 6 72 percent percent per percent cent the witness explained If the company's average average- to fixed capital account count of- of are also deducted he he- c added the thc earnings would i increase to per cent ent His testimony was intended to show that the then rate of return should be based on a fixed capital of of- 5 instead of 82 claimed by the company Read Into Record A section the of federal report dealing deal deal- ing with ing-with with a contract between the Utah Power Light company and Electric Elec Elec- Bond Share company was also read into the record Under this contract contract con con- tract the report showed the Utah Power ower Light company agreed to pay the parent company supervision fees scaling off from rom 1 16 6 per cent on the first of gross revenue to toonE onE one half of 1 I per cent on all gross revenue in excess of Other special and miscellaneous fees for various services rendered bythe by bythe bythe the Electric Bond Sh Share re company were also paid by the Utah utility according ac- ac according according ac- ac cording to the report S Sale of Bonds Stocks The IThe report supplied additional testimony testimony tes tes- tes- tes to the effect that the growth of ot the Utah Power ower Light Licht company since 1915 has been financed by the sale of bonds and preferred stock Bonds and preferred stock the report stated were sold in sufficient a amount to more than reimburse Electric Elec Elee- Bond Bond- Utah Securities Securities ties corporation for the cash cost of ot properties and other assets acquired b by the Utah Power Light company from those companies Notwithstanding this fact Colonel Smith pointed out dividends totaling were paid to these companIes companies com corn panics from 1925 to 1930 on common stock which cost them nothing Subject of of Salaries s Later Later- the thc subject p of salaries also drew heated object objections ns from company tom com pany counsel Fees paid the Electric El Bond Band aid Share for various services under under under-a a contract contract- 1932 for four years Mr Gadsby testified i amounted to o in round numbers These divided as follows he said In 1932 1931 1930 and 1929 |
