General Tel. Co. of Ohio v. Public Utilities Commission, 75-1094
| Decision Date | 26 May 1976 |
| Docket Number | No. 75-1094,75-1094 |
| Citation | 46 Ohio St.2d 281,348 N.E.2d 339 |
| Parties | , 15 P.U.R.4th 398, 75 O.O.2d 328 GENERAL TELEPHONE CO. OF OHIO, Appellant, v. PUBLIC UTILITIES COMMISSION of Ohio, Appellee. |
| Court | Ohio Supreme Court |
Power, Jones & Schneider, John Robert Jones and Andrew T. Jones, Columbus, for appellant.
William J. Brown, Atty. Gen., Charles S. Rawlings, Marvin I. Resnik and Ronald E. Prater, Columbus, for appellee.
The central issue presented is whether the commission erred in determining that a 7.14 percent rate of return was fair and reasonable. Specifically, appellant contends that the methods used to arrive at this rate were improper.
In finding that a 7.14 percent rate of return was allowable, the commission noted the recommendations of the witnesses, but found further analysis of their positions to be unnecessary. Instead, it relied primarily on the fact that appellant had previously been granted a rate increase for its service areas which had resulted in a 7.14 percent rate of return. General Telephone Company of Ohio, case No. 72-1038-Y (January 31, 1975). Although that case did not involve the territory which is the subject of this appeal, 1 the commission submits that R.C. 4909.15 prohibits it from allowing discriminatory or preferential rates and that approval of a rate of return herein in excess of the 7.14 percent granted in case No. 72-1038-Y would violate that proscription.
R.C. 4909.15 states, in pertinent part:
'When the public utilities commission is of the opinion after hearing, that any rate, fare, charge, toll, rental, schedule, classification, or service, or any joint rate, fare, charge, toll, rental, schedule, classification, or service rendered, charged, demanded, exacted, or proposed to be rendered, charged, demanded, or exacted, is, or will be, unjust, unreasonable, unjustly discriminatory, unjustly preferential, or in violation of law * * * the commission shall * * * fix and determine the just and reasonable rate, fare, charge, toll, rental, or service to be rendered, charged, demanded, exacted, or collected for the performance or rendition of the service, and order such just and reasonable rate, fare, charge, toll, rental, or service to be substituted for the existing one. * * *'
Clearly, R.C. 4909.15 requires that the commission not allow rates which are unjustly discriminatory or preferential, R.C. 4905.33 and 4905.35 2 supplement that duty by, in effect, prohibiting differences in rates which are charged to subscribers receiving the same service under similar circumstances and conditions. As can be seen, however, R.C. 4909.15 proscribes discriminatory rates, but does not prohibit a variance in the rate of return for different service areas of one company. 3
Decisions of this court and of the commission illustrate that the rate of return often differs between various areas of a single utility company. In Columbus v. Pub. Util Comm. (1960), 171 Ohio St. 38, 167 N.E.2d 769, the commission approved, and this court affirmed, a differential in rates of return between the city of Columbus and the unincorporated areas of the county, even though both were served by Columbus & Southern Ohio Electric Company. Similarly, in Columbus & Southern Ohio Electric Company, case Nos. 72-903-Y and 73-841-Y (September 4, 1974), the commission approved an 8.55 percent rate of return for the city of Columbus, while authorizing a 7.77 percent rate of return for electric service to 25 counties.
A series of cases involving Columbia Gas of Ohio, Inc., also reflect the fact that the commission often permits differing rates of return for various service areas of the same company. See Columbia Gas of Ohio case No. 36,973 et al. (May 7, 1973); Columbia Gas of Ohio, case No. 71-461-Y et al. (December 28, 1973); and Columbia Gas of Ohio case No. 73-454-Y et al. (July 8, 1975).
Additionally, the commission considered evidence presented by its staff witness, Mr. Rothey, as corroborative of the...
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