of

age or any other reason the defendant's poles are decayed or insecurely set in the ground, they must be reset or stubbed, or replaced by poles of sufficient height and cross section; and if it is a fact that the defendant's telephone wires are subject to breaking due either to age or interference from trees, said wires must be replaced, or trees trimmed, or both.

[2] It is our opinion that the defendant should be excused of responsibility for one week's time, during which the line in question was out of order and during which defendant's lineman was obliged to be absent for the purpose of fighting forest fires.

[3] The defendant's request that cost of reconnecting service for complainant cannot be allowed. The evidence showed clearly that complainant notified defendant promptly of his demand for an adjustment. The discontinuance of service by defendant was made as the result of a dispute in which complaint was made against defendant's action in demanding pay for service which was not received. The complainant having made a showing that his complaint was justified, the Commission is, therefore, justified, in requiring service restored without any payment by complainant for the cost of reconnecting.

Note.-Service.

1. In general, 340.

II. Extensions of service, 341.

III. Abandonment of service, 341.

IV. Service by particular utilities, 341.

I. In general.

In Re Mt. Carmel Public Utility & Service Co. No. 7356, March 2, 1921, the Illinois Commission held that it was without authority to authorize a heating utility to discontinue free heat to a municipal building when the furnishing of such free heat was a consideration for the utility's franchise.

In Tebbetts v. Kennebec Farm & City Teleph. Co. F. C. 319, Jan. 31, 1921, the Maine Commission held that a telephone company should not be required to make expenditures in repairing and rebuilding its facilities, where the exchange rates were unreasonably low, although there was a possibility that the subscribers might discontinue service in the near future on the account of local trouble.

II. Extensions of service.

In Re East Idaho Gas Co. Case F-418, Order No. 755, Feb. 28, 1921, the Idaho Commission held that a gas utility not yet under way, or the equipment of which has not yet been installed, should properly advance the cost of the construction of a sidetrack to furnish its coal, with the provision that a refund of this cost would be made when the service warranted same.

In Public Utilities Commission ex rel. Paul Kuhn & Co. v. Cleveland, C. C. & St. L. R. Co. (1921) - Ill., 129 N. E. 869, it was held that a shipper is not precluded from seeking an order of the Commission to compel a railroad to furnish a sidetrack because he has refused to sign a contract authorizing the company to discontinue service of its own accord and assuming liability for the company's negligence.

III. Abandonment of service.

In Re San Diego Electric R. Co. Decision No. 8341, Application No. 5009, Nov. 15, 1920, the California Commission allowed a street railway to abandon its service upon certain streets, where it was shown that operation on these streets had been conducted at a loss of approximately $1,000 per month.

In Re Mt. Carmel Public Utility & Service Co. No. 7356, March 2, 1921, the Illinois Commission held that whatever interest the public has in a utility property, is terminated when service cannot be rendered except at a loss.

In Cape Girardeau Press Brick Co. v. Cape Girardeau N. R. Co. Case No. 2625, Sept. 16, 1920, the Missouri Commission held that the receiver of a utility must discharge the utility's obligations to the public until abandonment is approved by the Commission, notwithstanding a court order permitting abandonment of service.

IV. Service by particular utilities.

In Re Verde Valley Stage Co. Docket No. 1267-A-435 et al. Decision No. 1258, March 29, 1921, the Arizona Commission held that the public is best served by schedule service and that a bus line operating on a schedule regulated by passenger demands would result in impaired, inefficient, and undependable service.

In Nickerson v. New York, N. H. & H. R. Co. Docket No. 3544, Feb. 23, 1921, the Connecticut Commission held that the continuance of a station agency and the discontinuance of the services of the agent, but the continued use of the physical property for depot and station service and the employment of a caretaker, does not constitute abandonment of said station, where it appeared that trains continued to stop to discharge passengers, and on flag to take on passengers.

In Chicago-Burlington & Q. R. Co. v. Allen, Case No. 2415, March 21, 1921, the Missouri Commission authorized a railroad to

discontinue the maintenance of a station agent at a point where it appeared that freight receipts had fallen off to such an extent on account of the prohibition of liquor, that the station could not be expected to justify the maintenance of an agent.

In Re American R. Express Co. C-566, March 30, 1921, the Nevada Commission denied an application for permission to close a city station, where it appeared that a material decrease in traffic had resulted from increased freight rates and the Commission stated that it would seem that a carrier largely responsible for the decrease in tonnage of which he complains, could not consistently urge relief from a condition for which he is largely responsible.

In Ferris v. Delaware & H. Co. Case No. 8065, March 22, 1921, the New York Commission, Second District, ordered the restoration of adequate train service where it appeared that although passenger revenue was small, the railroad derived a large freight revenue from the community.

Valuation

CALIFORNIA RAILROAD COMMISSION.

RE HERCULES WATER COMPANY.

[Decision No. 8710, Application No. 5679.]

Utility constructed for special service — Water.

Domestic consumers of a water utility should not be required to pay rates sufficient to provide a full return upon the value of a water system constructed by a powder manufacturing company primarily for its fire protection, and considerably overbuilt for domestic purposes.

[March 5, 1921.]

APPLICATION for increased water rates; increased rates author

ized.

Appearances: Pillsbury, Madison and Sutro, by Milton T. Farmer, M. P. Madison and E. M. Prince for applicant.

By the Commission: Hercules Water Company, applicant herein, is a corporation engaged in the business of supplying water as a public utility to consumers in the towns of Hercules and Pinole and adjacent territory within the county of Contra Costa. In this proceeding, said company makes application for authority to increase its rates, alleging in effect that the present rates do not provide sufficient revenue to yield operating expenses, depreciation, and a reasonable return upon the investment.

A public hearing was held in this matter before examiner Sat

terwhite in Richmond, and an adjourned hearing was held in San Francisco. All interested parties were duly notified and given an opportunity to be present and be heard.

Hercules Water Company pumps a portion of its water supply from its own wells and purchases the remainder from East Bay Water Company. The company's wells are located near the town of San Pablo, from which wells the water is pumped through approximately 5.6 miles of cast-iron pipe into a ten-million-gallon concrete reservoir at Hercules. A large part of the water supply is now purchased from the East Bay Water Company at a connection near the San Pablo wells, for which the contract rate of 10 cents per thousand gallons is paid. During six months of the year, water is also obtained from Pinole Creek, from which it is pumped into a concrete reservoir situated near the town of Pinole. Through faulty design and construction, however, this reservoir cannot be used to its full capacity.

It appears that Hercules Water Company was organized and incorporated by the Hercules Powder Company in 1902 for the purpose of insuring its powder works an ample and adequate supply of water both for industrial use and fire protection, and that incidental thereto the business of furnishing water to other consumers in that vicinity was developed.

Mr. M. R. MacKall, one of the Commission's hydraulic engineers, made a field investigation of the properties of applicant and at the hearing submitted a report and appraisement of the properties of said company devoted to water use. No objections were made to the appraisal as submitted, which showed an estimated original cost of $200,206, with an allowance for an annual replacement fund of $1,349 computed by the sinking fund method.

An estimated annual allowance of $17,572 was made for maintenance and operation expenses of this system. A consideration. of the evidence, however, leads to the conclusion that the amount allowed for the purchase of water was insufficient, and it is believed that the allowance for operating expenses should, therefore, be increased to $18,572, which amount will more nearly approximate the future operating conditions.

The total annual charges, based upon the above figures, are summarized as follows:

The rates now charged by applicant were fixed by the boards of trustees of the towns of Pinole and Hercules, and the revenues for 1919 were $33,474. Applicant is now serving four hundred and twenty-five consumers, four hundred and fourteen being domestic, of which two hundred and fifty are metered. The Hercules Powder Company uses more than 75 per cent of the total water consumed and because of the inflammable nature of the powder company's product, a very complete high pressure fire system has been installed, with an unusual number of fire hydrants for a system of this size, especially in and about the town of Hercules.

Inasmuch as this system was built and is maintained primarily for a highly specialized service, which inures to the benefit of one particular consumer, it would not be fair to burden the remaining consumers with rates which would yield a full return upon the entire investment. Furthermore, the evidence clearly shows that the system has a much larger capacity than is necessary to serve present consumers. The rates established in the following order have therefore been apportioned in such manner as to eliminate any discriminations which may have existed in the past, charge to each class of consumers a rate which is reasonable for the service rendered, produce maintenance and operation expenses, provide an annual replacement fund and yield a return upon the investment which is fair to the company under existing circumstances.

A Commission has no jurisdiction to compel a water utility, dedicated to the use of its owners and persons purchasing lands from them, to extend service to consumers who do not come within this class.

[March 9, 1921.]