ustxtxb_obs_1975_03_14_50_00011-00000_000.pdf

Hello, Central By Bill Mintz Thorndale While Southwestern Bell fights its legal battles against John Hill and James Ashley, the “other” phone company General Telephone Company of the Southwest is taking on much more modest courtroom foes. General has gone to court in Milam rates, even though customers there are already paying significantly more than those in nearby towns. GENERAL of the Southwest is one of 17 telephone operating companies of General Telephone and Electronics. Its territory is Texas, Oklahoma, Arkansas, and New Mexico. The company is headquartered in San Angelo, where it directs the activities of 264 exchanges in Texas. Revenues totaled $170,384,000 in 1973. Thorndale and Thrall are primarily agricultural communities northeast of Austin. Many residents work at the Alcoa plant in Rockdale. Thorndale Mayor Louis Woelfel, Jr., works for the Industrial Generating Co., a subsidiary of Texas Power & Light. Industrial Generating operates a lignite-fueled generating plant owned by Alcoa. Woelfel also farms and, because IGC has been on strike since Jan. 27, he’s been dividing his time among the city’s business, the farm, and the picket line. General first approached Thorndale and Thrall last fall for an increase in rates. The last rate case in the exchange had been concluded in January, 1973, when General won rates considerably higher than those in surrounding towns. Under the 1973 agreement, telephone patrons in the Thorndale-Thrall exchange pay $7.75 per month for one-party residential service; $5.80 for four-party residential service; and $16 for one-party business service. Last fall the company proposed a $9.50 per month charge for one-party residential, but it has since come down to $9.20. General District Manager Carl Kinslow made the revised request to Thrall in December, but Thorndale wasn’t notified until January after the suit was filed. Woelfel and the councilmen in Thorndale looked closely at the rate ordinance and then decided to turn down General’s request. The refusal, the councilmen told General, came for several reasons. First of all, the rates are already higher than neighboring cities. In nearby Taylor, customers of Southwestern Bell pay $6.50 per month for residential Mintz is a reporter for the Taylor Daily Press. one-party service. In Rockdale, also served by Bell, customers pay $6.25 for comparable service. La Grange, General’s district headquarters, enacteda new ordinance in June, 1974, that sets the one-party residential rate at $6.50. Second, General’s computation of the fair value of its property in the exchange area the magic number used for computing rate of return in Texas came up at $556,181. The council’s computation, based on property rendered for taxes in the Thorndale and Thrall school districts, was only $237,200, figured at 100 percent of value. The council also could not find any plants under construction in the exchange area, despite the fact the company added $6,828 to the rate base for that reason. Kinslow told Thorndale City Secretary Isabel Locklin that the construction entry was “just in case we decide to build anything.” The statute granting rate-making authority to general law cities allows a maximum rate of return of 8 percent on fair value of investment. General claims the present rates have a return of 4.26 percent and that the new rates would allow 6.41 percent. The city council’s figures say the new rate of return would be 10.1 percent. General jacked up “special services charges” for disconnects, reconnects, and moves in November, 1973, to much higher levels. Councilmen said those charges “are not justified and certainly increase your revenue from Thorndale while this revenue is not shown on the rate increase request.” Besides, service “has much to be desired,” the councilmen maintained. They complained of going days and weeks without service when the repairman was sick or on vacation. And, they said, the rate increase would be inflationary. KNSLOW told the council that while Thorndale’s rates are higher than other towns’ the company is “in the process of repricing our services in all of the exchanges.” He cited increased costs and said General itself was a victim of inflation. Kinslow came back to the councilmen in December, but Woelfel told him that no action would be taken until the Legislature was given a chance to imprOve the cities’ ability to analyze rate requests. “They’ve been overcharging us for two years,” Woelfel said. “I firmly believe that, viewed in the proper perspective, a judge will have to rule in our favor.” Before the city can have its day in court, though, an attorney will have to be hired. Thorndale’s 1975 budget, which totals $185,500, does not provide for a city attorney. One Austin firm quoted $25,000 as its price for handling the case. Woelfel doesn’t want to spend that much. “We don’t have unlimited revenues,” he said. Woelfel has retained Taylor lawyer James Cutcher to represent the city. His original answer to the suit the only March 14, 1975 11 CLASSIFIED Classified advertising is 20d per word. Discounts for multiple insertions within a 12-month period; 26 times, 50%; 12 times, 25%; 6 times, 10%. BOOKPLATES. Free catalog. Many beautiful designs. Special designing too. Address: BOOKPLATES, P.O. Box 28-1, Yellow Springs, Ohio 45387. PLAYING THE RECORDER IS EASY. Free catalog, best recorders, recorder music. Beginner’s Pearwood Soprano Book, $11.95. Amster Music, 1624 Lavaca, Austin. GUITAR PICKERS. Buy your guitar strings from us and save 20%. Mail orders accepted. Amster Music, 1624 Lavaca, Austin. WRITERS: “UNSALEABLE” MANUSCRIPT? Try AUTHOR AID ASSOCIATES, Dept. TO, 340 East 52nd Street, N.Y.C. 10022. JOIN THE ACLU. Membership $15. Texas Civil Liberties Union, 600 West 7th, Austin, Texas 78701. 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