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OCTORARO WATER COMPANY v. PENNSYLVANIA PUBLIC UTILITY COMMISSION (09/29/78)

decided: September 29, 1978.

OCTORARO WATER COMPANY, PETITIONER
v.
PENNSYLVANIA PUBLIC UTILITY COMMISSION, RESPONDENT



Appeal from the Order of the Pennsylvania Public Utility Commission in case of Pennsylvania Public Utility Commission v. Octoraro Water Company, No. R.I.D. 292.

COUNSEL

W. Russel Hoerner, with him of counsel, Morgan, Lewis & Bockius, for petitioner.

Melville G. M. Walwyn, Assistant Counsel, with him Daniel F. Joella, Assistant Counsel, and Barnett Satinsky, Chief Counsel, for respondent.

President Judge Bowman and Judges Crumlish, Jr., Wilkinson, Jr., Mencer, Rogers, Blatt and DiSalle. Opinion by Judge Crumlish, Jr.

Author: Crumlish

[ 38 Pa. Commw. Page 84]

Octoraro Water Company (Appellant) appeals the order of the Pennsylvania Public Utility Commission (PUC) promulgated on December 19, 1976, R.I.D. No. 292, granting it an increase in its annual operating revenues of $23,838 by way of a second stage tariff supplement.*fn1 Appellant had requested additional revenues of $129,166. We set aside this order and remand these proceedings to the PUC because, as we said in a similar case, viz, West Penn Power Company v. Pennsylvania Public Utility Commission, 33 Pa. Commonwealth Ct. 403, 406, 381 A.2d 1337, 1339 (1978):

[T]he want of adequate discussion and critical findings of fact leading to the conclusion does not enable us to perform our judicial role. To pass upon the merits of these appeals on the

[ 38 Pa. Commw. Page 85]

    present record before us would cast us in the role of making an independent judgment on the merits based upon the whole record before us, a role not given to us by law nor one which we are qualified to assume.

PUC's findings of fair value and fair rate of return were totally conclusionary and unsupported by any factual finding or meaningful reasoning. PUC determined the fair value of Appellant's utilities to be $1,970,000. The original cost thereof was $1,751,377. Thus, the fair value was found to be only 111% of its original cost. The trended original costs*fn2 or reproduction costs of Appellant's property varied, depending upon the precise method used, from approximately $6,100,000 to $5,200,000.*fn3 There was no testimony to the contrary and these figures seem to have been accepted as correct by the PUC. The sum total of PUC's discussion leading to their conclusion of fair value is contained in the following paragraph of their order:

In consideration of the foregoing, and taking into account our comments in previous sections of this Order, all based on thorough investigations, analyses, and testing of data, we find and determine for the purpose of these proceedings,

[ 38 Pa. Commw. Page 86]

    the fair value of respondent's property used and useful in public service at June ...


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