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upr000063 120

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upr000063-120
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University of Nevada, Las Vegas. Libraries

H and the Joint Facility Rents payable to the Railroad Company are measured by a 6-1/4% return on the Original Cost basis. This fact is disclosed by the calculations shown on Schedule IV attached hereto. This schedule compares the results de­termined by the Commission's decision with results calculated upon the Original Cost basis using a 6-1/4% return and when the operating expense estimates of the Commission are corrected’ to reflect proper operating expense charges. The attached schedule shows that in order for the Water Company to earn a 6-1/4% return on the Original Cost basis, additional revenues of $86,858.00 will be required over and above revenues to be received under the prescribed rates and that under the pre­scribed rates the Water Company will suffer an actual deficit of $7,954.00. This schedule also shows the results for the year 1951 which result from the prescribed rates when the rate bases of the Railroad Company and of the Water Company are determined by averaging the True Investment Cost rate base and the True Original Cost rate base and assuming that 6-1/4% is a fair rate of return on such average rate base. On such a basis it is shown on the schedule mentioned that the Water Company will continue to suffer a net deficit of $1,335.00 under the pre­scribed rates during the test year 1951 and that additional revenue of $71,912.00 will be required over and above the revenue earned under the prescribed rates in order for the Water Company to receive a 6-1/4% return on the rate base -70-