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Show Letter to the Editor r Dear Editor: The utility rate increases being asked by California Pacific Utilities Company should not be approved. After careful study of the Annual Report of the Company Com-pany and other evidence used to support the request, there are at ' least three reasons why the requests for over a 50 percent in-rate in-rate increasees should be denied. First, the company has no competition to force it to use better resource management, and even with a dramatic 30 percent increase in revenues from 1974 to 1975, the net profits were about the same. Even with-dramatic with-dramatic increases in energy L costs, a thirty percent increase ii I revenues, when properlj managed, should be enough to allow for profitable operation WITHOUT FURTHER INCREASES IN-CREASES in revenues. Second, capital improvements should not be paid for by utility customers. Capital investments should come from investors. One of the pleas by California Pacific executives is to have the Commission Com-mission approve rate increases to recover costs of real property which have become assets of the company. Third, California Pacific is in an enviable tax position. They are, in effect, being subsidized by the taxes paid by their customers. In 1975 the company received a refund of $628,108 from Federal income taxes paid in previous years. The total income in-come tax for 1975 was only $51,458 on an income of $49,500,000. In Iron County California Pacific Utilities paid $107,512 in property tax in 1975. It is estimated that the company will pay only $68,000 in property taxes in Iron County in 1976. The difference was created by a re-evaluation re-evaluation of home and farm properties and a reduced mil levy. Again the customers of CPU will be paying the difference dif-ference in taxes. The taxes not collected from the utility company com-pany will be collected from home and farm owners. This probably happend in Washington County two years ago at the time of their re-evaluation. re-evaluation. RECOMMENDATIONS : (1) That NO increase in rates be allowed (2) That Cedar City and-or Iron County governments immediately im-mediately consider the purchase of transmission lines from California Pacific Utilities and get the generating capacity of the local plants back in use. A study of the experience of the town of Hurricane which has already purchased transmission lines would be helpful. Yours truly, Kent E.Myers |