Image
Copyright & Fair-use Agreement
UNLV Special Collections provides copies of materials to facilitate private study, scholarship, or research. Material not in the public domain may be used according to fair use of copyrighted materials as defined by copyright law. Please cite us.
Please note that UNLV may not own the copyright to these materials and cannot provide permission to publish or distribute materials when UNLV is not the copyright holder. The user is solely responsible for determining the copyright status of materials and obtaining permission to use material from the copyright holder and for determining whether any permissions relating to any other rights are necessary for the intended use, and for obtaining all required permissions beyond that allowed by fair use.
Read more about our reproduction and use policy.
I agree.Information
Digital ID
Permalink
Details
More Info
Rights
Digital Provenance
Publisher
Transcription
TV u.. y Memo to E. E. B.: JJ / V ( \ r v S r ' u S\ k i) August 26, 1952 BO-11 Re: <h& <f%r Differences between rate base fixed by Nevada Public Service Commission in Decision of August 13, 1952, and reproduction cost valuations made by L. R* Maag and James M. Montgomery* _____ ~ ~ i n its decision of August 13, 1952, the Commission fixed a rate base, for the combined production and distribution system of $1,197, 220» In doing so the Commission ignored entirely any figure submitted of the original cost of such facilities, which was somewhat higher, and the figures submitted showing the present value of the same facilities, which were very substantially higher than the book cost. There are some errors in the Commission's figures which I will refer to hereafter, but disregarding them for the time being, it can be said that the Commission's figures represent the average of the book cost as of December 31, 1950, and December 3 1 , 1951, of 679.42 acres of land and those portions of the production and distribution systems which were capitalized when constructed, less accrued depreciation deductions made by the Commission plus $30,000 for water rights and $20,000 allowance for working cash and materials and supplies. The Commission's figures have nothing to do with the sale price of land and plant any more than the cost to some householder in Las Vegas of building a house ten years ago upon a piece of land acquired by him in 1902 would have to do with the present market value. As you know, most of the land included in the rate base estimates of the Commission was purchased in 1903 or 1904, and a substantial part of the production and distribution systems has been constructed at prices lower than the present costs of construction. Furthermore since the Commission averages the year-end book costs of 1950 and 1951, ib is apparent bhab lbs figures do not represent even the book cost as of December 31, 1951. Furthermore the Commission's figures disregard entirely any capital expenditures made to date in