pany is undertaking to correct are most scrious during the winter months, and as long as the company makes every effort to correct these conditions and to carry out the terms of our order of April 23, we believe that it is entitled to have the rate matter taken up and disposed of. However, it should be clearly understood that no disposition of the rate situation at this time can relieve the company from its responsibility to comply with our order of April 23, and to carry out the program therein. outlined. On the assumption that the company will complete this program with all possible dispatch, the Commission feels that an adjustment of rates should be made, but that any adjustment should be so limited that in the event of a failure of the company to properly improve the service conditions authoriza tion will not have been granted for continuing an advanced rate indefinitely. The Commission will, therefore, limit the time during which the rate fixed by this decision shall be applicable to the period ending September 30, 1920, and the rates to be charged for service rendered after that time shall be as fixed in such supplementary order as it may appear proper to make in view of the service improvements which the company shall have completed.

In decisions issued May 1, 1920, and May 21, 1920, with reference to gas rates at Chippewa Falls and Eau Claire, respectively, the Commission discussed at some length the general bases of valuation which it applied in those cases and which it would serve no particular purpose to reiterate in this case. The situation in this case as to the general nature of the testimony dealing with the matter of valuation is substantially identical with the situation in those cases. There are in all four engineering appraisals before the Commission in this case, two of which were made by William A. Baehr on behalf of the company, one by Byron T. Gifford on behalf of the city of La Crosse, and one by the Engineering Department of the Commission. On behalf of the company, the valuations submitted by Baehr were made on two general price bases. In one, current prices as of approximately May 1, 1919, were used, and in the other, average prices for a five-year period ended about the first of 1919 were used.

The basis for Gifford's prices does not appear very clearly in the record, but it was, apparently, what may be termed a modified estimate of original investment.

The valuation submitted by the Engineering Department of the Commission was, in the main, an estimate of the original investment in existing property, except that property installed prior to about 20 years ago was not priced at the prices prevailing at the time of installation but was priced on an average price basis on conditions prevailing before the war. In so far as these valuations refer to the physical property of the company the following is a statement of the totals:

In none of the above figures has there been any inclusion for materials and supplies although these were inventoried by our Staff and are shown on their summary valuation. The figures shown above cover comparable items in all of the valuations. In addition to the amounts shown above Baehr adds the following to his appraisal:

Gifford shows no additions to the cost of reproduction as determined by him, but adds to the depreciated value $30,000 to cover working capital and materials and supplies, and $45,000 to cover going value.

The Commission's engineers show, in addition to the figures given in the foregoing table, $34,910 for materials and supplies which are shown as in 100 per cent condition. The final values in so far as they are indicated by the appraisals submitted in evidence, are shown in the following table. Under Gifford's val uation nothing is shown for cost new, inasmuch as he did not apparently concede the propriety of basing the rate-making value upon the cost new. From the valuation submitted by our Engineering Department non-operating property with a cost new of $276 and a depreciated value of $262 has been excluded.

The foregoing valuations were made as of May 1, 1919. There is not in the case a record of additions to property made during May and June, 1919, but we have before us a statement of the net additions for the last half of 1919. If we add these net additions amounting to $9,223 to the valuations as shown above we obtain what may be taken as a fair indication of about the average values as they would probably have been shown during the last half of 1919.

At the time of the last hearing the company called attention to the fact that in a previous case involving rates at LaCrosse, 8 W. R. C. 161, the Commission made the following statement:

From a careful examination of the available accounts of the company, the records of the city and the history of paving and construction of underground distribution systems, we conclude that the paving costs, as they appear in the engineers' valuation, were not entirely borne by the company, but that the amount paid out for paving, as nearly as can now be determined, was about $33,054, divided among the several departments as follows:

In the valuation submitted by our Engineering Staff the estimate of paving disturbed was placed at $1,222 new and $978 in present condition. We have had a careful study made of this situation by our Engineering Staff, and our engineer reports that after making a full study of the situation, in so far as available records permitted, he believes that about $6,000 might properly be added to the estimate for paving as included in the valuation as of May 1, 1919, which was submitted as Petitioner's Exhibit 9. We have carefully gone over the engineer's report and believe that this amount should be included and that it represents a reasonable amount to be allowed.

[2] Having in mind all the evidence as to the matter of value, and giving consideration to all factors which have a bearing upon the value of the property, it is our judgment that $535,000 represents a fair valuation upon which to adjust the rates of the LaCrosse gas utility.

REVENUES AND EXPENSES

Due to the rapid and material changes in the cost of supplying gas service during recent years we are particularly interested, in this investigation, in the results obtained during the year ended June 30, 1919, and the last half of the year 1919 as reported to the Commission. Following is the statement of revenues and expenses for those periods as reported:

It is apparent that on the basis of the reported figures the revenue of the company has been far short of the amount required to provide for depreciation and return upon the value found in this case. Roughly speaking, the amount available for depreciation and return has been, approximately, the amount required to provide for depreciation with little if anything available for return.

A check of operating revenues indicates that they have been apparently correctly reported.

Operating expenses for the LaCrosse plant are in some respects higher than the general level of expenses in comparable

plants in the state. The following table shows the expenses per 1,000 cubic feet of coal gas made for the principal items entering into coal-gas production in a number of gas plants for which we have reports:

It will be noted that the production expense amounts to $1.33 per 1,000 cubic feet, which is 16 cents per 1,000 cubic feet above the cost at Eau Claire, and considerably above the cost in all the other cities except Wausau. However, a comparison of the cost of coal carbonized, as shown in the second column of the foregoing table, explains a considerable part of this difference. The cost of coal carbonized is 9 cents per 1,000 cubic feet higher than the cost for Eau Claire, 26 cents higher than the cost for Green Bay, 13 cents higher than the cost for Fond du Lac and Manitowoc, and 25 cents higher than the cost for Sheboygan, The table also makes available the comparison with the other cities.

In the third column of the foregoing table are shown the expenses exclusive of the cost of coal, and the cost at La Crosse is somewhat above the general level, although not higher than the cost at Green Bay and Wausau, and only slightly higher than the cost at Manitowoc. In the other accounts shown in the foregoing table there is considerable variation among the plants. It will be noted, for instance, that in a number of the plants the steam cost is relatively low, while the cost of retort-house labor is relatively high. Retort-house labor at LaCrosse is among the lowest in the group, but the steam cost is the highest. This