*is 'j i s a 3\ 'o00c> ^$av)JZV 'OH0^2/ ygtoRTf1 s^Waoa^; n I ^ ^ 3o a ^ a T \ v2) 7sTf3, [gVvIvT V^AV5j>^V Sooti/ TslL ZqP*5v & $ *** > s**>oo>5^ ^Tno) uTsT^h G i^ 0 X0 ^2/ wtSALiT /qS22m ^ v ^ CAV^ > ^*n o o ^ Tn yV > [qV>-Av^* '^ o o ttij' S >o^V ^ o o ti/ >^borg7 T m * J WiAjV < A ^ T c *v > sJjJaoo'^- frn ^ N ti V [gjXlJ 'ooocft' Srt*/ ' 0 * 012/ V ^ O R g7 T r& 2, ' O 00 v ' t=jjfs<^ J^oTotg/ v ^ f A Y O j * < v ' ' 0 '>Cf^' > A Y 35% > .A)c-d Ul of the regulatory activities of the Commission for the year ending December 51 1967* Z l Respectfully submitted, >et - CQ Z D O CQ COM M ISSIONERS CRAWFORD L. PILCHER, c h a ir m a n BEN T. WIGGINS, v i c e c h a ir m a n L p h a A.FOWLER, JR. WILLIAM H. KIMBROUGH WALTER R,MCDONALD (icorgta "publit jiwirirf (^mmisesttm 2 4 4 W ASHINGTON STREET, S.W . At l a n t a , G e o r g ia 3 0 3 3 4 October 15 1968 A. O. RANDALL, s e c r e t a r y To His Excellency Lester Maddox Governor of Georgia Dear Governor Maddox: As provided by law, the Georgia Public Service Commission submits herewith its 95th Annual Report of the regulatory activities of the Commission for the year ending December 51 1967* Respectfully submitted, / "P 3 ,0 Tip y Crawford L. Pilcher, Chairman m r., ommissioi i^Llisj^ \H. Kimbrough, Commissioner mW i\ Walter R. McDonal ommissioner 95th AOTTJAX REPORT Introduction The Annual Report of the Georgia Public Service Commission covering the activities for the year ending December 51 1967 is submitted herewith in compliance with law. Chairman Crawford L* Pilcher, and Vice Chair man Ben T, Wiggins were re-elected Chairman and Vice Chairman, respectively, for a term of two years, com mencing April 3 1967* The members, officers and personnel of the Commission as of December 31* 1967 were as follows: Crawford L. Pilcher, Chairman Ben T. Wiggins, Vice Chairman Alpha A. Fowler, Jr., Commissioner William H. Kimbrough, Commissioner Walter R. McDonald, Commissioner A* 0, Randall, Executive Secretary and Legal Aide Mrs. Mae A. Montgomery, Reporter Robert B. Alford, Chief Utilities Engineer IV Douglas N. Smith, Utilities Engineer III Charles W. Worthy, Utilities Engineer II Frank G. Heald, Public Utilities Auditor Ben-j.F.McLaughlin, Accountant II J. Winford Poitevint, Accountant II David 0. Benson, Transportation Rates Expert J* Fred Parker, Transportation Rates Specialist II L* Thomas Doyal, Transportation Rates Specialist II and Chief Law Enforcement Officer Albert R. Bush, Transportation Rates Specialist I, Larry L. Carpenter, Registration Supervisor Anna Loraine Wolff, Accounting Clerk II (Fiscal) George E. Thurmond, Civil Defense Officer. All other Commission employees are listed in alphabetical order as of December 31 1967? sis follows: Mrs. Charlene Andrews, Stenographer II Mrs. Geraldine Barrom, Stenographer II Mrs* Carolyn Baxley, Stenographer III Mrs. Mozelle Colquitt, Stenographer III Herbert R. Daugherty, Law Enforcement Officer W. E. Doolittle, Law Enforcement Officer Mrs. Ann R* Donehoo, Stenographer IV Miss Marlyn Harnage, Typist I Mrs. Verlon Hastings, Stenographer II Mrs* Mary Heaton, Receptionist James H. Hooks, Law Enforcement Officer Mrs. Linda H* Ingle, Stenographer II Miss Carolyn B* Jenkins, Typist II Mrs. Virginia R* Mann, Stenographer III Mrs. Emily Martin, Stenographer III David R* Meeks, Law Enforcement Officer Mrs* Patricia A* Moon, Stenographer III Judson L. McGinnis, Law Enforcement Officer Mrs. Ruby D* Otwell, Clerk II Mrs. Patsy B. Porter, Stenographer III Miss Lucia A.. Ramey, Stenographer III Mrs* Lucile A. Tuggle, Stenographer IV Floyd L* White, Law Enforcement Officer S. A. Wheeler, Sr*, Law Enforcement Officer Mrs* Joan H* Wilson, Stenographer II Bobby Edmondson, Utility Clerk Of the foregoing list of employees, Mrs. Geraldine Barrowm, Albert Bush, Miss Marlyn Harnage, Mrs, Mary Heaton, Mrs* Verlon Hastings, Beng. F, McLaughlin, David R. Meeks, J. Winford Poitevint, Mrs. Patsy B, Porter, Mrs. Charlene Andrews, Mrs* Lucile A. Tuggle, S* A. Wheeler, Sr., Floyd L.White, and Charles W* Worthy were employed during the year 196?. Of these Mrs. Barrom and Mrs. Porter were former em ployees of the Commission. The following employees (not listed above) re signed during the year: James D, Barnett, Frances'R* Buckman, Robt. W* Hayes, Donald J, Lawrence, Lois H*^ Long, Iona A* McCullough, Doris C* Mills, Isaac 0* Pier son and Claudia L* Samples* On September 26, 1967, the Commission lost a very valuable employee in the death of Mr. Robert N. Fellows, Fiscal Officer and Registration and Insurance Supervisor of the Commission for twenty-three years. Mr, Fellows died of a sudden heart attack at his home. He had apparently been in good health and had not exper ienced any illness of a serious nature during the period of his employment. He was married and leaves^besides his widow, two sons and a daughter, His oldest son is - 2- married and in.Military service, but was at the home of his parents on the night of his fatherfs death* Mr* Fellows was deeply devoted to his family and loved his work with the Commission* He was in the prime of life, having died at the age of 4-9* He possessed a friendly nature and his death was a tragedy to his family and the Commission* PUBLIC HEARINGS During the year the Commission conducted three hundred twenty public hearings* Public hearings com mence on the second and fourth Tuesdays in each month and continue on successive days thereafter until all current applications and petitions have been disposed of* All matters docketed for public hearing are heard by the entire Commission in open session, a majority of the Commission constituting a quorum. MOTOR CARRIER CERTIFICATE & LICENSE FEES The Commission is charged with the responsi bility of collecting and accounting for motor carrier certificate and license fees* The total certificate and license fees collected and remitted to the State Treasurer during the year 1967 are as follows: Certificate fees at $35*00 each, and certi- ficate transfer fees at $7*50 each - - - - - $ 3?332*50 Regular license fees at $25*00 each - - - - - $365,825*00 Reciprocal fees at $1.00 each - - - - - - - $ 30,079*00 T O T A L -------------$399,236*50 In addition to the foregoing certificate and license fees of $399,236*50 collected by the Commis sion, the Railroads and Utilities under the jurisdic tion of the Commission were subject to a tax assess ment which produced a sum of $280,000*00, which was collected by the Property and License Tax Unit of the Department of Revenue, making a total of $679,236*50 available for appropriation to the Commission, although it should be noted that the appropriation for the Commission was limited in the Appropriation Act of 1966 to $523,000*00* -3- MOTOR CARRIER CERTIFICATE DECISIONS ________ During the year 1967 the following motor carrier decisions were made by the Commission: Certificate applications: Approved - - - - - - - - 90 Denied - - - - - - - - - 12 Withdrawn - - - - - - - 12 Dismissed - - - - - - - 9 Total T2J Certificate transfer applications: Approved - - - - - - - - - - - - - 83 Denied - - - - - - - - - - - - - - 2 T o t a l --------------- 85 Certificate amendment applications: Approved - - - - - - - - - - - - - - 155 Withdrawn - - - - - - - - - - - - - 1 Leased ---- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 5 Merged - - - - - - - - - - - - - - - 19 Certificates control through transfer of capital stock - - - - - - - - - - 25 Certificates cancelled - - - - - - - - 18 Certificates suspended - - - - - - - - 164- Certificates reinstated - - - - - - - 14-7 Total - - - - - 534- Rules nisi issued and dismissed - - - 32 Miscellaneous:(Extensions, reconsid erations, refunds, schedules, etc.) - - 94* Total Decisions - - - - 868 Among the foregoing decisions on applications for certificates were three applications for Class nP" Certificates, all of which were approved. The order establishing the classification Class "P", Certificate, issued October 24-, 1966, was reproduced in the last Annual Report. At the time of the issuance of that order there were pending before the Commission the ap plications of United Parcel Service, Inc., Theatres Service Company and Benton Bros. Film Express, Inc., for Class nP M Certificates. Hearings on the application of United Parcel Service, Inc. were concluded on Decem ber 7, 1966. Hearings on the applications of Theatres Service and Benton Bros# were concluded on^January 17 1967. On January 26, 1967 the Commission issued orders approving all three applications, and certificates were issued accordingly* It is significant to note that during the year no other application for Class r cer tificate was filed with the Commission* AMENDMENT OF THE GENERAL MOTOR CAR RIER RULES AND REGULATIONS______ On March 31 1967 the Commission amended Rules 61 and 62, and Rule 27(b). The General Assembly having amended Code Section 68--310 at its General ession on April 9, 1963, with reference to fixing of rates for contract carriers, Rules 61 and 62 were amended and made applicable to all classes of carriers; also Rule 27(b), requiring all Class A , B and C Car riers of C. 0. D. shipments to have a C. 0. v . Bona on file with the Commission, was amended to apply to all classes of carriers* On August 24, 1967, Rule 12, which prescribes the "Commercial zones and terminal areas of Class A Certificate holders, and Rule 89(9)9 which defines the "residential, commercial and industrial areas ol Class "C" Certificate holders, may provide service within the area defined as follows; NOTE "A": Where the combined Population(see Note UB" below) of the municipality and contigu ous municipality or municipali- The highway mxleage ties is: shall be: ---- Less than 2,500 Two miles plus 11 of any other municipali ty, any part of which is within said two miles) 2,500 - 24,999 Three miles (plus all of any other munici pality, any part of which is within said three miles) (continued on paSe 6) -5 - 25,000 - 99,999 Four miles (plus all of any other munici pality, any part of which is within said four miles) 100,000 or more Five miles (plus all of any other munici pality, any part of which is within said five miles) NOTE " B " : Population shall be as shown in latest United States e: On September 7, 1967, the Commission amended paragraph (c) of Rule 8 to read as follows: (c) A holder of a Class "B" Certificate which establishes a place of business in a city or town other than the principal place of business shown in the certificate shall file with the Com mission a terminal report on form prescribed by the Commission within ten days of the establishment of such place of business. When a place of business, other than the principal place of business shown in the certificate, has been established it may not be discontinued except upon ten days notice to the Com mission, Failure to file this report or failure to give ten days notice to the Commission of the dis continuance of service at a place of business shall be cause for suspension or cancellation of the cer tificate authorizing service. Motor carriers oper ating under Class "B" Certificates of Public Conven ience and Necessity which have been authorized to transport household, kitchen and office furniture as defined in Item 1 of the appendix to this rule shall be subject to the additional rules for appoint ment of agents set forth herein as Exception 5 to said appendix. On September 13, 1967, the Commission amended sub-paragraph (i) of Rule 25 by striking from lines 15 and 16 thereof the following words: "which shall be good for the life of the vehicle or until the vehicle is removed from service," the effect of which was to require that motor vehicles operated from --6!? other states solely in interstate commerce under reciprocal agreements must be registered annually. On October 20, 196?, the Commission amended Rule 67 to read as follows: Explosives and other dangerous articles, when tendered for transportation, must con form to the requirements of law and to the rules and regulations adopted or prescribed by the TJ. S. Department of Transportation, Federal Highway Administration, or they will be refused. MOTOR CARRIER ENFORCEMENT During the year 1967 a total of ninety-five cases, either handled by the courts or presently pend ing, reflects the activities of the Motor^Carrier Enforcement Department of the Transportation Division in the apprehension and conviction of persons, firms or corporations operating as motor carriers "for hire" either without appropriate intrastate authority from the Public Service Commission or operating without a registration of interstate operating authority from the Interstate Commerce Commission contrary to the rules and regulations of the Public Service Commission and in violation of the laws of the State of Georgia. Georgia law requires the registration of all "for hire" interstate motor carriers using the highways of Georgia even though they may be transporting com modities exempt from the economic jurisdiction of the Interstate Commerce Commission or operating as a carrier specifically exempt from the jurisdiction of the Interstate Commerce Commission. These court actions have resulted in fines and bonds posted totaling $8,779.00, averaging approximately $93.00 per violation. Cases were -7- filed in twenty-one counties which counties retain all fines and/or "bond forfeitures accruing from such cases. SUMMARY OF LAW ENFORCEMENT OFFICERS* REPORTS Officer Miles Inspection Operated Reports Daugherty 17,096 176 Doolittle 20,576 281 Hooks 30,300 155 McGinnis 18,299 162 Meeks Wheeler 210,,099504 25152 Personal License Rate Contacts Fees Checks 450 $ 425.00 130 310 3 ,775.00 63 5011 $1 ,250.00 162 490 650.00 240 62 $ 450.00 56 575 3 ,625.00 261 * White (White and Meeks work together in the Atlanta area). * Employed by the Commission in October 1967 TRANSPORTATION General During 1967, the Commission and its Transportation staff officially disposed of, in addition to the formal proceedings listed below (most of which were made the subject of written opinions), 655 transportation rate and service matters, a considerable number of which required lengthy studies and investigations in the field. FORMAL CASES FOR YEAR 1967 Docket N o . Date 62U-R 1-5-67 626-R 1-13-67 627-B 2-7-67 323I-M 2-16-67 329I-M 3-9-67 Subject Disposition Application of Central of Georgia Railway Company for authority to discontinue agency service at Bowdon Junction. Denied Application of Georgia Railroad for authority to discontinue switch engine service at Milledgeville. Withdrawn Application of Central of Georgia Railway Company for authority to discontinue agency service at Machen. Approved Application of J. H. Boyd, dba Boyd Brothers, for au thority to increase rates on cotton between points in Georgia. Approved Application of Baggett Bulk Transport, Inc., for authority to increase rates on cement, in bulk and in packages, between points in Georgia. Lesser increase approved 623-R 3-30-67 Application of Central of Georgia Railway Company for authority to discontinue agency service at Oglethorpe. Approved 1st Supp. i|-- 2i+--67 584-R Application of Louisville & Original order Nashville Railroad Company vacated and and Atlantic Coast Line Rail- proceeding road Company for authority to discontinued institute condemnation proceed ings for the purpose of acquiring certain property in Warren County# Docket Wo. Date 631-R 632-R U-24-67 33I+5-M if-2^-67 628-R 5-31-67 629-R 5-31-67 630-R 5-31-67 633-R 5-31-67 637-R 6-22-67 FORMAL CASES FOR YEAR 1967 (Continued) Subject Disposition Application of Railway Express Agency, Inc., for authority to increase Georgia intrastate class rates and package rates. Approved Application of Georgia Motor Trucking Association, Inc., on behalf of the Class "A" Motor Carriers of Property for authority to increase class rates and minimum charge. Approved Application of Seaboard Air Line Railroad Company for authority to discontinue agency service at Montrose. Denied Application of Railway Express Agency, Inc., for authority to close the express office at Montrose, contingent upon the closing of the railroad agency at that point. Denied Application of Southern Railway Company for authority to dis continue agency service at Juliette. Approved Application of Seaboard Air Line Railroad Company for authority to discontinue agency service at Richmond Hill and to discontinue Richmond Hill as a flag stop for Seaboard Air Line Railroad Passenger Trains 9 and 1 0 . Approved Application of Southern Rail way Company and Georgia Southern and Florida Railway Company for authority to discontinue oper ation of their passenger trains numbers 3 and U between Atlanta and Valdosta. Approved - 10- Locket No. Date 3385-M 6-22-67 3^03-M 6 -22-67 634-R 7-6-67 635-E 7-6-67 3395-M 7-6-67 636-R 7-13-67 FORMAL CASES FOR YEAH 1967 (Continued) Subject Disposition Application of Georgia Motor Trucking Association for au thority to make applicable for account of the members of the Class nC" Rate Division of that Association a joint tariff containing re vised rates, rules and regu lations covering the operations of those carriers within the scope of their Class "C" certificates. Approved with certain ex ceptions Application of Georgia House hold Goods Movers Association, Inc., on behalf of its members and other carriers party to the Georgia Household Goods Tariff Bureau Georgia Intrastate Tariff GPSC-MF No. 5 for authority to increase rates and to charge travel time. Lesser measure of increase and travel time authorized Application of Georgia Southern & Florida Railway Company for authority to discontinue agency service at Vienna. Approved Application of Central of Georgia Railway Company for authority to revise the services of its agency stations of Oconee and Toomsboro by establishment of dual agency operation under a single agent. Approved Application of J. & M. Trans Approved portation Co., Inc., to increase rates on cement. Application of Savannah & Atlanta Railway Company for authority to discontinue agency service at Stapleton. Approved 11 ' - - Docket No. Date 8-2^-67 NonDocket 9-7-67 638-R 9-22-67 639-R 9-22-67 6U0-R 9-22-67 641-R 9-22-67 642-R 9-22-67 FORMAL CASES FOR YEAR 1967 (Continued) Subject Disposition Amendment of General Motor Carrier Rules 12 and 89(a) to extend service areas of Class "Cn Motor Carriers and pick-up and delivery areas of Class "An Motor Carriers to 5 miles of city limits. Graduated ex tension ap proved (2 to 5 miles de pending on population of city) Amendment of General Motor Carrier Rule 8 of the General Motor Carrier Rules and Regu lations issued January 1 , 1933 to provide rules for appoint ments of agents by household goods carriers. Rules prescribed Application of Southern Railway Company for authority to discontinue agency service at Concord. Approved Application of Southern Railway Company for authority to discontinue agency service at Locust Grove. Denied Application of the Savannah Union Station Company, pur- suant to Code Section 9^-32^, for an order of the Commission approving and authorizing the surrender to the State of Georgia of the franchise of that company to operate as a railroad. Approved subject to conditions Application of rail carriers for authority to increase freight rates and charges on Georgia intrastate traffic to the same extent authorized on interstate traffic under Ex Parte 256. Approved with exceptions Application of Railway Express Agency, Inc., for authority to close the express office at Concord, contingent upon the closing of the railroad agency at that point. Approved 12- FORMAL CASES FOR YEAR 1967 (Continued) Docket No. Date 3383- M 3384- M 9-22-67 3^63-M 3U6U-M 9-22-67 Subject Disposition Application of National Bus Traffic Association, Inc., Agent, on behalf of 12 motor carriers of passengers for authority to increase bus passenger fares (except commuter fares) and express rates by ten per cent. 10 per cent express rate increase and 7.3 per cent passenger fare inceease approved Application of Obis Dixon Transfer, P. R. Dunn Trucking Company, Creel Trucking Company, Anderson Spreader and Hauling, Textile Trucking Company, Inc., and Noah Davis for increase in rates on cotton and for re striction of rule permitting stopping-in-transit to partially load or unload. Modified uni form scale of rates and rule approved 361-R 10-20-67 Application of Southern Rail- Approved way Company for authority to dis mantle the station building at Lula and to discontinue handling L.C.L. freight to and from that point. 1st Supp. 6k)-R 621-R II-27-67 Surrender of Charter by Savannah Union Station Company. Previously prescribed conditions modified H-27-67 Application of Seaboard Coast Line Railroad Company for au thority to discontinue agency service at Byromville. Dismissed with out prejudice 622-R 11-27-67 Application of Seaboard Coast Line Railroad Company for au thority to discontinue agency service at Rebecca. Dismissed with out prejudice -13- BUS FARES AM) SERVICES At the end o f 1967 there were 35 bus lin e s operating under the ju ris d ic t io n o f t h is Commission p ro vid in g in te rc it y se rvice between p o in ts in Georgia - a decline o f 6 from the number so operating at the end o f 1966. Many o f the S t a t e 's sm all bus lin e s which were so prevalent during and sh o rtly a fte r World War I I have discontinued operations and the p rin c ip a l bus operations rem aining are o f sub s t a n t ia l c a rrie rs which can be expected to continue in se rvice in d efin ite ly. The continually spiraling increase in cost of operations caused by the general economic trend toward inflation in wages and prices forced the bus carriers to seek during this year an increase in passenger fares and express rates only two years after an increase was granted in 1965. By application dated January 19* the 12 principal bus lines in the State sought authority to increase both passenger fares and express rates by ten per cent and to increase the minimum charge on express shipments to one dollar. The Commission declined to approve the proposed increase without justification therefor at public hearing, and following several postponements the hearing was finally held on July 27. At the hearing the applicants tendered a number of exhibits showing specific increases in cost - primarily in the area of wages and wage related expenses - and used such showing as explanation for the increase in operating ratios of these carriers. The composite operating ratio of the applicant carriers in Georgia for 1966 was found to be 92.5, a return considered inadequate by bus carriers in general. The bus lines emphasized the fact that the intrastate fares in Georgia based on a scale diminishing with distance - beginning at 3 cents per mile and declining to 2.5 cents per mile at distances of 250 miles - was substantially below the interstate fares between points in the South and that, with the exception of Florida, the Georgia fares were the lowest in any of the southeastern States. Similar showing was made in comparison of the bus express rates - with both the rates and minimum charge in Georgia indicated to be lower than corresponding such rates and charges in most of the other Southern States. The Commission recognized that in the two years since it last authorized an increase in bus fares there had been a substantial increase in the cost of all the materials, supplies and labor used in the transportation of passengers just as there had been in almost every area of trans portation operations and concluded that there was justification for increased revenues to this class of carriers. The Commission held that it was still not in agreement, however, with the contention of the applicants that the operating ratio for bus lines must be in the low 8o's, pointing out that no other motor carrier operation in the State was conducted at such a favorable ratio and that the Commission was not convinced that the transportation of passengers had sufficiently different characteristics from motor carrier transportation in general to demand such a return. The Commission specifically found that the composite operating ratio of 92.5 on Georgia intrastate traffic, with an indication of a less favorable ratio in the future due to the known increases in cost of operation, was admittedly too high to expect the carriers to continue to provide the type of service required by the bus-using public in the State and granted a measure of increase which it felt would reflect a more reasonable Georgia contribution to the overall operation of those carriers. In view of the fact that there was no objection from the shipping public to the proposed increase in express rates, and in view of the fact that the revenue from the substantial Georgia express traffic had long helped to reduce the carriers* revenue requirements from the transportation of passengers - their first responsibility to the public - the Commission granted the full measure of increase sought in express rates. However, the Com mission reduced the measure of increase on passenger fares to 7-3 per cent, finding that such an overall authorization should return to the carriers approximately four-fifths of the increased revenue sought and would provide sufficient additional income to reduce the intrastate operating ratio to between 88 and 89, even when there was included in the carriers' costs the increase in operational expenses currently being incurred. The authorization for increase in passenger fares resulted in the new fare basis in Georgia beginning at 3*2 cents per mile and declining in 50 mile blocks to 2.7 cents per mile for distances over 250 miles. While there were many bus schedule changes made during the year few had any significant adverse effect on the traveling public intra state in Georgia and, without exception, all such proposed adjust ments were modified after informal handling to substantially satisfy complainants. TRUCK RATES The trend of the general economy in Georgia and throughout the nation during the year towards higher wages and higher materials cost forced a wide range of increases in rates of the motor carriers of property. For six years the fixed route motor carriers of property were able to absorb increases in costs of operation through greater ef ficiency, heavier load limits and selective increases in rates but the rapid increase in cost of operations reflecting the inflation in the entire national economy forced this year an application for a general increase in such rates. By application dated February 27 the Class "A" Motor Carriers of Property sought authority to increase the minimum charge per less-truckload shipment to $3.68; to increase rates on shipments over 2,000 pounds by 6 per cent; to increase rates on shipments less than 2,000 pounds to the same level as applicable on interstate traffic and to revise all accessorial charges to be the same as corresponding charges on interstate traffic. At the hearing on the application there was submitted a summary of a traffic study conducted by seven repre sentative intrastate carriers showing that during the test period of one week those carriers handled 81,328 shipments, weighing 7^,327j^ 3 pounds and returning revenue of $765,898.5^ with the intrastate portion of that traffic accounting for 27,760 shipments -15- fwuttm weighing 22,867,337 pounds and earning revenue of $2k5 ,6l6 .2 2 . Ke-rating of the intrastate shipments affected by the proposed increased rates indicated an increase in revenue of $7 ,572.85 from class rated traffic and $6,863.37 from the increased minimum charge, with the total increase in revenue for this study period of $ 1 ^ 3 6 . 2 2 , resulting in an indicated annual- increase in revenue of $750,6 8 3 It was shown that the 1966 operating ratios of the carriers participating in the traffic study varied from a low of 86.1 to a high of 105*07 with the average being 97.6 . Similar showing for all of the Georgia fixed route motor carriers of property indicated a range in operating ratios from 86,1 to 105*07 - the average of all such Georgia intrastate carriers after elimination of seven carriers whose operations are predominantely interstate was shown to be 96.8. All of the carrier witnesses advanced as justification for the proposed rate increase the increases in operating costs incurred by their companies since the last in crease in rates was authorized and their current poor earning records as indicated by their collectively (and in most cases individually) high operating ratios. Opposition at the hearing was limited to cross examination of applicant witnesses by several protestants, with there being indication by some of these protestants - concurred in by a written statement by one protestant - that the principal purpose of their protest was not to oppose the increase in rates at issue, but rather to make known to the Commission that such lack of opposition should not be construed as approval of any attempt by the applicants at a later date to increase, or have the Commission's decision if it should be favorable to the applicants set either a precedent or pattern to increase in the future, rates on any type of traffic now subject to commodity column or point-to-point commodity rates. The Commission found that the applicant carriers as a group should be permitted to earn additional revenues if they were to be expected to continue to provide adequate motor carrier trans portation service to the shippers and receivers of freight in the State and accordingly approved the increase as sought with a finding that such increase would improve the operating ratios of the affected carriers from an average of 97.6 to an average of 95.4 - still above optimum level but, for a majority of the carriers involved, an adequate return. By application dated March 13 the Georgia Household Goods Movers Association, Inc., on behalf of its members and other carriers party to the Georgia Household Goods Tariff Bureau Georgia Intrastate Tariff GPSC-MF No. 5 , sought authority to increase fates for the transportation of household goods in Georgia to the same general level as effective on interstate traffic as published in Household Goods Carriers' Bureau Tariff No. 118-B, and to increase charges applicable on hourly rated movements by from 20 to 28.6 per cent. Authority was also sought to increase certain accessorial charges and to modify a number of rules governing the transportation of such commodities. As was ' j- I -- s 0 n s a x w o g uT. a J l ' i o n i fX v ;~ o .t s : ? .ri J ' . 'is.i i l 0 l :' : gl -Vi : n i ) f l ` ; 5 io ' ;(r rv' j :^8 'v e T O I 0 O r t v; 1X ' i v \r # j * : : J- X C1X C: ... Q .. ; P '4;i ;$ es '13* j Il ,J,. Z, . a o i/ii/q u J j : ' , S U ? / J L o B i'j fix ; ; io n i q o i o ;h - : . 1 0 0 3 l a r i ; .* n o i a s \ q rn o J j v'i is j O l a v o r i B i;'j y..: rt . 0 E f 9 'J o / f i O - j O Z jZ l O ^ S X Q # o io ; ; ;Ua :3 & f lJ a'ACr Jodi/O-X fQsKlSXiXSts) 9 f f l ; H'iBB c,;r '.'/."Tai", .v; ,5X. lcr'{jn the case during the year with all other applications for increase in rates, these applicants based their request on increases in cost of operation. Exhibits were submitted showing the average cost of new materials and supplies had increased by 1 4 .9 per cent in the past three years and that wages during the same period had increased an average of 24.8 per cent, with that wage increase effect being compounded by an increase in the number of paid holidays in the year from 4 to 10 days; increase in number of paid vacation days per year from 5 to 15 days and increase in the meal and lodging expense ranging from $6.00 to $14.00 per day. A study of 187 intrastate weight and distance shipments transported by 26 Georgia household goods carriers during a test period showed a loss in such transportation of $6,636.65 and an operating ratio of 114.7 . Application of the proposed rates to the same shipments would have returned a net profit of $5 5933*89 and produced an operating ratio of 8 9 *7 The study of 189 shipments reported by 26 carriers and rated under the existing hourly rates showed a net loss of $4 ,187.87 and an operating ratio of 134.6 . Re-rating these shipments under the proposed hourly charges and applying the proposed traveling time would result in an overall profit of $665.97 for the 189 shipments and an operating ratio of 98 per cent. The Commission extensively reviewed the expense exhibits of the carriers and other cost statistics available from financial reports of the carriers and concluded that while ad ditional revenue was needed to offset increased costs of operations, there had not been justified an increase to the interstate level of rates. Accordingly, there was authorized an increase in the weight and distance rates of approximately 15 per cent and an increase in the hourly charges of 50 cents per hour per vehicle and 50 cents per hour per man less than was sought.. The Commission also broadened the travel time charges previously authorized to provide for one-half hour charge on all hourly rated movements outside the 5-county Atlanta metropolitan area where there had been shown con ditions similar in type but less in degree than had justified the one hour time in the Atlanta metropolitan area. By application dated December 5 last year one of the principal intrastate haulers of cement in bulk and in packages sought authority to increase rates by amounts varying from 9*67$ to 39*23$? with an overall average of approximately 21$. At the hearing the carriers submitted income and expense statements showing overall company loss for the first 11 months of 1966 of $31,640.97 - broken down to a loss of $4 2 ,478.29 on its Georgia operation and a profit of $10,837.32 on its Alabama operation. Upon developing that these statistics included the interstate operations of the carrier the Commission required the adjustment of the exhibit to reflect only Georgia intrastate operations which, when filed, showed a reduced loss of $17,971.07. This revised statistic reflected not only the separation of the intrastate expenses but also a different method of proration of such expenses than originally submitted. The testimony and exhibits submitted by the applicant indicated that much of its loss was incurred on short haul shipments within the Atlanta metropolitan area - the traffic study showing that 86$ of the Georgia intrastate movement for the 11 month study period -17 moved within a radius of 25 miles of Atlanta. It was shown that the costs incurred on these movements were high because of a labor contract guaranteeing four hours minimum pay to the driver, plus one hour loading time, at the rate of $2.0 1 per hour for each load made to points within Fulton and DeKalb Counties. The Commission found that the carrier had demonstrated a need for additional revenues, particularly on the short hauls where the traffic con gestion in the Atlanta area had such an adverse effect on the operation of motor vehicles. The Commission found, however, that the increased revenue of $4 7 >893-70 from the proposed increased rates and the resultant operating ratio of 89$ was not required to maintain the Georgia intrastate operations of this carrier in a sound financial condition and would, to that extent, unduly burden Georgia shippers and authorized a lesser measure of increase in the rates which would produce an operating ratio of between 91 and 9 3 * By application dated March 27 another motor carrier of cement in bulk and in packages sought an increase in rates on that com modity, although to a lower level than that previously approved for account of the first carrier. Upon showing that the carrier's operating ratio under the existing rates was 101.3 > the Commission approved the increase sought, which was projected to result in reduction of that operating ratio to 9 7 *8 . During the year eight of the principal motor carrier trans porters of cotton sought authority to increase rates on that com modity and to adjust accessorial provisions to increase rates for such services in many instances and to specifically reduce the number of stops permitted in the stop-off to load and unload rules. Following conferences with the involved carriers and public hearing the Commission authorized a lesser measure of increase while approving the rule changes and the reduction of the number of stops in the stopping-in-transit rules. By application dated March 8 the Georgia Motor Trucking Association sought authority to make applicable for the Class nC" carrier members of the Class MC W Rate Division of that Association (some l6 such carriers) a joint tariff containing revised rates, rules and regulations covering the operations of those carriers within the scope of their Class "C" certificates. In consideration of a number of protests against the proposed publication, the Commission assigned the matter for public hearing which was held on May 11. At the hearing the Association presented for the record the rules of procedure of the Georgia Class "C" Carrier Rate Committee and reviewed the principal provisions there of, particularly those providing for individual action on the part of the carrier members. It was pointed out that these rules of procedure were substantially similar to and patterened after those in effect for the Class "A" Carriers* corresponding committee a committee which had been in existence for many years and had functioned effectively during that period with there having been demonstrated full freedom for individual carrier exception to decisions of the committee. The tariff as filed was similar in -18. format to the in d iv id u a l t a r if f s o f many o f the c a rrie rs which i t was contemplated to replace, and in ad d ition many o f the ra te s were those which had been published in such in d iv id u a l t a r if f s and applied fo r long p eriods o f tim e. The proposed p u b lic a tio n con tained not only uniform rate s fo r account o f these c a rrie rs but a lso incre ase s in many o f such ra te s fo r some o f the c a r r ie r s , J u s t ific a t io n fo r t h is increase was advanced by the c a rrie rs as being th e ir increased costs of operations, w ith those increases in c o sts being d e taile d both at the hearing and in la te f ile d e x h ib its. There were se ve ra l p rote stants at the hearing, in c lu d in g a shipper o f chocolate candy and re la te d a r t ic le s , a major foodstore chain, a major manufacturer o f fo o d stu ffs and a bleach m anufacturer. A ll of these protestants indicated opposition to the increases sought w ith some in d ic a tin g that they were w illin g to accept some increase in ra te s but not to the extent proposed. The C la ss "C " c a rrie rs have been regulated by the Commission fo r almost a decade and the t a r if f s o f that group o f c a rrie rs have varie d w idely fo r th e ir e n tire p eriod o f operation and the Commission found the b e n e fits o f a uniform t a r i f f to be su b sta n tia l and d id not concur in the a lle g a tio n o f the p rote stants that the Join t t a r i f f was proposed only as a mere device to increase ra te s. The Commission a lso found that the increase in ra te s could undoubtedly have been effectuated much e a sie r by most o f the involved c a rrie rs through in d iv id u a l a p p lic a tio n s w ithout the s ig n ific a n t delay and expense o f Jo in in g the A sso c ia tio n and d ra ftin g and p rin tin g the uniform t a r if f . I t was fu rth e r found that the c a rrie rs were in need o f the a d d itio n a l revenue which t h is t a r i f f would b rin g in and fo r those reasons the Commission approved the p rin c ip le o f a uniform t a r i f f and the general rate le v e l sought. The Commission d id except, however, from the increase the ra te s o f the bleach manufacturer and the candy shipper, re q u irin g the c a rrie rs to make a d d itio n a l stu d ie s o f those movements. Those stu d ie s were made and submitted to the Commission, but before such could be processed both protestants indicated that th e ir protest had been s a t is fie d by subsequent changes made by the applicant c a rrie rs or by change to c a rrie rs not involved in the proceeding. For many years the Commission had been experiencing d if f ic u lt y w ith the re g u la tio n of agency operations o f the no fixe d route motor c a rrie rs - p a rtic u la rly those c a rrie rs tra n sp o rtin g household goods. Many such agency re la tio n sh ip s have been o f such an inform al nature as to make i t im possible to determine the scope o f authorized operation, d u tie s, r ig h t s and r e s p o n s ib ilit ie s o f the agent and the extent of co n tro l o f the c a rrie rs. In some instances the Commission even found former agents s t i l l operating without knowledge o f the c a rrie r and in other cases agents operating before the f u ll concurrence o f the c a rrie r had been obtained. The Commission had endeavored to m aintain some degree o f co n tro l over such agency operations by re q u irin g the f i l i n g w ith the Com m issio n o f a "te rm inal re p o rt" showing some d e ta ils o f the agency sta tu s. T his procedure proved u n sa tisfa c to ry both in the content and handling o f that procedure and in the fa ilu re o f the c a rrie rs^ to uniform ly observe e x istin g term inal report ru le s. The Commission 19- had previously considered requiring the discontinuance of all motor carrier agencies but the impact on the operation of a number of carriers, particularly in the household goods field, had been indicated to be too substantial to permit the elimination of such agency relationships. Following numerous conferences between the Commission's staff and the household goods carriers a more compre hensive set of rules and regulations was developed to better control the agency operations among that category of carriers and on September 7 the Commission prescribed such comprehensive rules and regulations as an amendment to its General Motor Carrier Rule 8 with the requirement that those new rules and regulations become effective on January 1, 1968, By notice dated June 7 the Commission advised the holders of Class "A" and Class "C" Certificates of Public Convenience and Necessity that it proposed an amendment to Rule 12 and Rule 89(a) of its General Motor Carrier Rules and Regulations to extend the Class WA" pick-up and delivery limits and the Class "CM operational limits from the existing two highway miles of the city limits to five highway miles of such city limits. The notice had attached thereto a map of the Atlanta area showing the effect of the proposed change in the State's largest metropolitan area. At the hearing the Class MC ,, carriers supported the proposed rule change as being required by the rapid expansion of industry within the State particularly in the larger metropolitan area such as in Atlanta with the attendant demand for extension of the limits within which local cartage service could be performed. A shipper witness supported this proposal with the specific request that the revised limits include service to the Lockheed-Georgia Company at Marietta. Representatives of the Class "A" Carriers testified in general opposition to the rule as proposed, with much of that opposition being directed to the inclusion of Smyrna and the Lockheed-Georgia Company in the proposed new cartage limits. One such Class "A" carrier now maintaining a terminal at Marietta indicated that it might be forced to discontinue that terminal if the rule changes proposed were adopted and its traffic to the Lockheed-Georgia traffic affected. Further Class "A" Carrier objection was expressed concerning the cost of extension of pick-up and delivery service to the new area - there being indication that such new service would require additional revenues through higher rates or a new charge. There arose during the course of the hearing suggestion that the proposed rule be modified to provide limits for pick-up and delivery and cartage type operations corresponding to those prescribed by the Interstate Commerce Commission as its commercial zones - those limits varying with the population of the involved cities and towns. As modification of this proposal some of the Class "A" Carriers suggested that in addition to serving a specified area of the city limits of towns on their routes such carriers be further authorized to serve any point within one mile of their certificated routes outside of municipal terminal areas. The Commission found a definite need for the extension of these services and found merit in the proposal to base the area of operation on the size of the towns involved and, following finding that the new extension would not include the Lockheed-Georgia Company within the service limits - 20- of Atlanta, prescribed on August 2k an amendment to Rules 12 and 89(a) to provide service areas of from two miles to five miles from city limits, dependent upon the population of the involved towns * RAILWAY EXPRESS The financial status of the Railway Express Agency reached a crisis during this year*. The constantly increasing cost of operation, coupled with the severe weather conditions throughout the country during January and February, forced the Express Agency to again seek a general increase in its rates in order to continue to provide its services to the public. On May 2^ it sought an added 20 cent per less-than-carload shipment emergency surcharge for the announced purpose of trying to n...at least meet a break even financial condition by June and for the remainder of the calendar year". In recognition of the extremely critical financial situation of the company and after discussing the matter informally with the principal shippers in the State, the Commission on May 25 approved the emergency increase, subject to complaint and further order, to become effective not earlier than June 1 . Throughout the year there were other increases in rates in individual tariffs made effective on Railway express traffic, all for the basic purpose of relieving the financial distress of the company, including increase in the rates in the Railway Express Package Tariff - which move the bulk of the express traffic in Georgia - by 50 cents per shipment. The status and future of the Railway Express Agency is of great concern to all in the transportation field - particularly to those shippers who have come to depend upon the highly specialized services of the agency. The rapid diminution of passenger train services forcing the Agency to other modes of operation and the ever increasing cost of doing business have played havoc with its independent operation and the prospects are for severe re duction in services at ever increasing rates unless drastic action is taken with considerable overhauling of its services and facilities. During the year the Express Agency sought authority to close 16 express offices - only 2 of such applications being contingent on the approval by the Commission of concurrent application of the railroads involved to discontinue agency service at the involved stations. In the 2 contingent applications, the Commission approved the discontinuance of both the railroad agency and the express office at Concord as not being required by the public convenience and necessity, but found that the public need did require continuance of both railroad agency service and the express offices at Montrose and accordinaly denied the Agency* s petition to close its office at that point. Of the lk other applications, the Commission granted authority to close the express offices at Ashburn, Clinchfield, Harlem, Jasper, Odum, Pavo, Temple, Tucker and Woodstock but denied applications to close the offices at Hamilton, Ludowici, Lyons, Sycamore and Vienna. - 21- RAIL PASSENGER SERVICE As has been the practice for the past several years, the Atlantic Coast Line Railroad sought authority to consolidate its East and West Coast Champion passenger trains for the off-peak season of April 29 through June 22. Later, following merger of the Atlantic Coast Line Railroad and the Seaboard Air Line Railroad, the resultant Seaboard Coast Line Railroad sought authority to consolidate these trains during the period September ^-December 13* Later in October the Seaboard Coast Line Railroad sought authority to revise its passenger train service along the Georgia coast during the winter season so that the former "Florida Special" trains would not be operated during that season but the "East Coast Champion" trains would be re-routed and rescheduled to operate during such season via the route and on the schedule and at the fares of the "Florida Special" trains with the "East Coast Chamption" trains to be actually designated as the "Florida Special" during that period. The application contemplated that at the end of the winter season the "East Coast Champion" trains would be restored as such and returned to their previously existing routes, schedules and fares. The Commission, in accordance with its policy of permitting adjust ments in service where demanded by economics of operation and where such adjustments would promote long-term retention of the service, again approved these seasonal consolidations and adjustments, subject to the same provision that arrangements be made to provide substitute service between Nahunta and Waycross for passengers traveling between those points. There was only one application to the Commission during 19&7 for authority to discontinue operation of passenger train service most such applications involving trains operating in Georgia now being filed with the Interstate Commerce Commission as result of the jurisdiction granted that Commission by the Transportation Act of 1958. In May, however, the Southern Railway Company and the Georgia Southern and Florida Railway Company did seek authority to dis continue operation of their Passenger Trains Numbers 3 and k (the "Royal Palm") between Atlanta and Valdosta. These two trains operated between the terminal points of Cincinnati, Ohio and Valdosta, Georgia on a daily schedule - a total of 729*6 miles in each direction, 239.9 miles of which were in Georgia between Atlanta and Valdosta. The applicants submitted the usual exhibits showing the routes of the trains, the other service available along those routes, the revenue from operation of the trains and the costs of operation thereof - those statistics showing that for the year ended March 31, 1967 the "Royal Palm" trains operated in Georgia a total of 173,760 miles and earned gross revenues of $87,107, of which $31,3^6 consisted of passenger revenue, $55>76l mail revenue (earned during the months of April, May and June, 1966) with there being no express revenue earned by the trains. The out-of-pocket expenses during the same period amounted to $355?1^7 resulting in a claimed net out-of-pocket loss of $268,0^0 for this - 22- J J'r,-'.': instici r ' n i w i -exW' s a ^ a o m r a g r mo* '.'- %s '. ii?0i% S . i a os : ' ::f.30O Ux7llBcl 3^t% * y-. aaf;i : : q ^ - r :< : >: a .. ... ;. $. "a. /.j .' i b*a it: ., '$$ ttocne ; . 12 month period. A supplemental exhibit showed that the two trains during the months of July, 1966-April, 1967 (during which there were no Pullman cars on the trains and no mail handled by the trains) earned revenues of $25,715 solely from the transportation of passengers with out-of-pocket expenses of $270,063 resulting in a claimed net out-of-pocket loss for this period of $2Mf,3^-8* The statistics submitted by the applicants indicated that the intra state use of the "Royal Palm" trains was principally between Atlanta, Macon and Valdosta with a total of b ,1^-9 passengers riding south bound train 3 during the year ended March, 1967 and *+,2l6 passengers riding northbound train ^ during that period. Other than at these three points, passenger use of the trains averaged less than one per day with the single exception that 1 .3 passengers per day detrained from train 3 at Warner Robins. The Commission received a number of letters of protest from the affected area and there was opposition at the hearing by representatives of the labor unions whose members operate these trains. These protestants charged that there had been inadequate advertising of the train services and that the change in the southern terminus of the trains from Jacksonville to Valdosta had resulted in severe loss of passengers. It was readily apparent that the discontinuance of the "Royal Palm" trains as Florida trains had drastically reduced their attract iveness to through passengers and resulted in a substantial drop in passenger revenue. The subsequent discontinuance of the handling of express by the Southern Railway in September, 1965, coupled with the diversion of the mail from these trains by the Post Office Department (in accordance with its expanding policy of diversion of mail from railroad service) had reduced the earning capability of the trains to a level where the revenues from passenger traffic paid less than 20$ of the crew wages alone and made the continuing operation of the trains a financial impossibility. While it realized that this was the last passenger train service between Maoon and Valdosta, the Commission also recognized that the extremely limited passenger use of the trains, coupled with the high availability of alternate passenger services (20 bus schedules daily in each direction serving all or a portion of the towns involved) and the parallel high speed highways, demonstrated the lack of need for the trains and the negligible contribution they were making to the public convenience and necessity of the area and accordingly reluctantly approved the discontinuance of the trains, to become effective not earlier than July 5 * RA IL FREIGHT On July 31 the Interstate Commerce Commission issued its order in Ex Parte No. 256 authorizing the rail carriers to increase their rates and charges on interstate traffic. Those increased interstate rates were made effective on August 19 and on August 21 the railroads operating intrastate in Georgia sought authority -23- to increase their freight rates and charges on Georgia intra state traffic to the same extent as had been increased on inter state traffic. This was the first general freight rate increase sought by the railroads since i960 and the railroads emphasized that, in spite of the fact that their railroad costs had progress ively risen since that time, the railroads, through "bold new pricing and operating techniques" had actually reduced their rate level by 8 per cent, but that their increases in costs had reached the point that made it imperative to obtain increased revenues through increased rates. It was pointed out that the rate increases sought were on a selective basis, giving consideration to particular circumstances affecting the movement of various categories of commodities and appertaining to the various accessorial services this approach resulting in some rates and charges not being increased and others being increased by varying amounts. Similar filings were stated to have been made in all States within the South with the increases in Alabama, North Carolina and South Carolina to become effective in late September and early October and early hearings scheduled within the other Southern States. A large volume of statistics were submitted by representatives of the railroads showing results of operations of the carriers both individually and as a group for prior years and showing the resultant rates of return to have dropped to 3 34$ in 1966. These statistics also showed the intrastate revenues of these carriers to have dropped in importance since 1959* (o-i which time it was at an all high for the past 17 years of 13.51$ of total revenues), declining to 11.22$ in 1966. It was shown that the railroads' net working capital had declined from a high of $141,847,864 on December 31, 1964 to a low of $34,439,819 on December 31 > 1966, that their ratio of current liabilities had dropped by 15 per cent and that their December 3I3 1966 ratio of ll6$ was the worst in the past 17 years. Total long term debt of the railroads was shown to have climbed to $1 ,210,283,451 as of the end of 1966, an amount higher than any other year during the 17 year period and over 50$ higher than that owed at the end of 1950. In further justi fication for the emergency type increase proposed, the carriers submitted details of further increases in operating costs incurred in late 1966 and in 1967 showing those increases for the eight Georgia Class I Railroads to amount to $4 6 .9 million - principally in the areas of wages and related costs. A pro forma projection of the entire year 1967 showed that without the Ex Parte 256 rate increases (interstate and intrastate) the net railway operating income of these carriers would drop to $116.3 million and their rate of return would drop to 4 .01$. With the full Ex Parte 256 increases the income would rise to $131.1 million and the rate of return to 4 .52$. Representatives of individual carriers testified in similar vein, showing the impact of increased costs on their companies' operations and claiming severe need for immediate increase in revenues. Shipper protest to the in creases sought were very limited - one light weight structural aggregate producer complaining of the increase on his commodity not being matched by increase on competitive products and one pulpwood shipper not concurring with all the other major pulpwood -24- users in the State in their indication that they did not object to the proposed increase on that commodity. The other protestants at the hearing was a representative of* a soft drink manufacturer using large volumes of sugar who protested against the method of application of the proposed increases in rates on sugar. The Commission found that in spite of the rapidly improving railroad, technology and the more realistic pricing made possible by heavier loading cars and more efficient management policies, the effect of the constant spiral of inflation on the rail trans portation industry - particularly in the last year - had been such that the railroads could no longer absorb their increases in cost and required additional revenues to continue to provide necessary services. The prospect of further increased costs and the beginning of a drop in traffic (caused partly by labor unrest in other industries), coupled with prospect for continued drop in net income, with the net working capital of the railroads already at an alarming low, convinced the Commission that the applicants should be granted additional revenues, particularly in view of the fact that the increases sought were comparatively modest and that most shippers had conceded the railroads ' need for increased revenue. Under the circumstances, the Commission approved the increase, making only one exception thereto - that being to preserve the competitive balance between the light weight aggregates and the products used in competition therewith permitting the approved increases to be made effective not earlier than October 10 on not less than 10 days' notice, with the provision that where adjustments were made on specific commodities or specific services as result of the Interstate Commerce Commission s further investigation of specific phases of Ex Parte 256 similar adjustment would be made on Georgia intrastate traffic. During the year two more railroads sought authority to dis continue the handling of less than carload shipments weighing less than 6,000 pounds - this year the Tennessee, Alabama & Georgia Railway and the Atlanta and West Point Rail Road seeking such^ authority. As has been consistently done by the Commission, it denied these applications, reaffirming its position that the Com mission considered it to be the duty of a common carrier to handle all traffic tendered to it within the scope of its operating au thority, with any revenue deficiency incurred in handling of any segment of traffic to be made up by rate adjustments to the extent necessary and not by the denial of such service to the public. In the field of handling railroad freight there was only one other application for service change during the year - that in volving the proposal of the Georgia Railroad to discontinue its switch engine service at Milledgeville and to substitute in lieu thereof switching service to be performed by local freight trains serving that town. The Commission received a number of complaints from shippers and civic organizations at Milledgeville protesting the proposed discontinuance of this switch engine service and in consideration of those complaints required the Georgia Railroad to continue the switch engine service pending public hearing. -25- Following further study of the freight operations at Milledgeville and negotiations with the involved shippers and labor unions the ^ Georgia Railroad reconsidered its proposal and withdrew its appli cation, RAILROAD ABANDONMENTS In 1962 the Savannah Union Station Company received authority from the Interstate Commerce Commission to abandon its properties and to discontinue operation. This abandonment was the result of construction of a new joint passenger station by the Seaboard Air Line Railroad and Atlantic Coast Line Railroad in suburban Savannah and the subsequent transfer of terminal operations to that station - all of which was occasioned by the need of public authorities for a large section of the right-of-way of the Savannah Union Station Company (including the passenger station itself) as a route for an interstate highway leading through the City of Savannah. On June 27 of this year the Savannah Union Station Company sought to wind up its affairs by securing from this Commission an order approving and authorizing the surrender to the State of Georgia of the franchise of that company to operate as a railroad within the city limits of Chatham County, Georgia, The application was filed and hearing held in accord ance with the provisions of Code Section 9^~326 and following compliance with all requirements of the Georgia law the Com mission by original order dated September 22 and supplemental order dated November 27 authorized the surrender of this company's franchise. RAIL AGENCY SERVICE The railroads continue to seek authority to discontinue their agency services at the smaller towns - either due to declining revenue from such stations or to change in consist of traffic to and from such stations to such as does not necessarily demand the services of an agent. A number of such applications processed this year increased over the number handled last year indicating a continued drive of the railroads to save operational expenses wherever possible. This year the Commission processed twelve such applications and, as is its established custom, adhered to the policy of deciding those applications on the need for and use of the service rendered rather than solely on the statistical showing of revenue versus cost. After finding that the public convenience and necessity no longer demanded the services of an agent the Commission authorized the dis continuance of agency service at Concord, Machen, Oakland City, Oglethorpe, Richmond Hill, Scottdale, Stapleton and Vienna. The need for agency service at Bowdon Junction, Juliette, Locust Grove and Montrose was found to outweigh the savings to the railroads from their discontinuance and and the Commission denied authority to close the agencies at those points. -26- During the year there was another consolidation of agency services whereby one agent did provide agency services at two stations. The Central of Georgia Railway Company sought to establish dual agency service at its stations of Oconee and Toomsboro and following public hearing and finding that the proposed service would be adequate and in view of the lack of public opposition to the proposal the Commission approved this dual agency plan, effective August 1. WESTERN & ATLANTIC RAILROAD The annual report of the lessee of the Western & Atlantic Railroad for the calendar year 1967 shows for the net expendi tures charged to the accounting classification "Additions and Betterments" by classes of railroad property, the following amounts: Improved Track Material........... * $ Grading and Drainage................ Bridges, Trestles and Culverts...... Yard Tracks and Sidings.... . Station and Office Buildings...... Shops and Enginehouses............. Communication Systems............... Signals and Interlockers........... Grade Crossings.... ................. 1+U,08l.32 1 ,235.60 6,61+8.21 13,^27.55 * (l,20l+.2 2 )* 1,581+. 29 26,1 2 6 .1+6 * 35,959.36 * 2,306.77 * The above net additions reported are after deduction for value of property replaced during the year and total $13 0 ,1 6 5 .3*+* The net capital expenditures made by the lessee for additions and improvements to the Western & Atlantic Railroad from the beginning of the lease in 19 19 through December 31, 1967, amount to $8,518,578. There was contained in this 1967 Additions and Betterments Report a number of adjustments to prior years* reports reflecting changes in charges to the Additions and Betterments Account at various locations. Some of these locations were at or near Tilford Yard in Atlanta and sidetracks serving specific industries and inasmuch as the status of Tilford Yard and some of those side tracks were under review by the State it was concluded that the Commission would withhold its approval of this Additions and Betterments report until such time as it had been determined what effect, if any, these adjustments and charges of prior years would have on the status of Tilford Yard and the side tracks. There was reviewed in last year*s report the activities of the State Properties Control Commission in the preparation of a new lease for the Western 85 Atlantic Railroad. As there pointed out, the State Properties Control Commission on December 20, i960 found the Southern Railway Company to be the highest bidder for the new lease of the Western & Atlantic Railroad and * - Includes adjustments to prior years' reports. -27- by majority vote resolved to forward the bid of that company to the General Assembly at its 1967 session for its confirmation or rejection as provided by the State Properties Control Code There was great controversy in the General Assembly over the confirmation of the award of the lease to the Southern Railway, resulting in numerous hearings before both the House and the Senate and lengthy debates in the committees and on the floor of each of those Bodies. The Louisville and Nashville Rail road - the present lessee and the unsuccessful bidder - con tended that its bid would actually return more to the State over the 25 year term and offered to make more definite the provisions of its "variable bid" which had been criticized as being indefinite. Following these lengthy hearings and debates the General Assembly voted to reject the award to the Southern Railway as the highest bidder and to return the matter to the State Properties Control Commission for further handling in line with the State Properties Control Code. Following that directive the State Properties Control Commission held further meetings during the year with repre sentatives of the Louisville and Nashville Railroad and Southern Railway and a new interested party, the Georgia Railroad & Banking Company. Some changes were made in the proposed lease - principally to provide for a minimum rental, a minimum escalation clause in the rental, further clarification of the tax status to provide that any ad valorem taxes found to be legally applicable would be paid by the State and arrange ments for the Atlanta Metropolitan Atlanta Rapid Transit Authority to use specifically described property for rapid transit purposes in Atlanta. All of these changes were fully reviewed at public hearing and incorporated into the form of lease to be attached to the bid forms. Invitation for Bids was issued in November, with advertise ments being again made in newspapers of general circulation in every county through which the railroad operates in both Georgia and Tennessee. At the bid opening on December 20 the Southern Railway returned its bid papers indicating that the minimum bid specified was higher than it felt it could pay for the rail road lease and the Louisville and Nashville Railroad bidding one million dollars flat annual rental, plus an escalation factor of 2.5 per cent, which resulted in a bid with a minimum rental to the State over the 25 year and k days term of the lease of slightly over 32-| million dollars. There was no bid from the Georgia Railroad and Banking Company. Following the opening of the bids, the State Properties Control Commission formally declared the Louisville and Nashville Railroad to be the highest responsible bidder and unanimously voted to forward the bid of that company to the General Assembly at its 19^8 session for its confirmation or rejection as provided by the State Properties Control Code, -28- PARTICIPATION IN INTERSTATE TRANSPORTATION CASES As detailed in last year's report the Central of Georgia Railway Company and the South Western Rail Road Company filed during that year application with the Interstate Commerce Com mission for authority to discontinue operations over and to abandon the line of railroad between Cuthbert Junction and Fort Gaines, Georgia. At the request of interested citizens of the affected area protesting the proposed discontinuance of service this Commission agreed to assist in the preparation of the protestants* presentation to the Interstate Commerce Commission, to assist protestants * counsel at the hearings and to there undertake the analysis of statistics and cross-examination of applicants' witnesses on their presentations of results of operation of this line. Public hearing on this application was held in Albany, Georgia in January of this year, at which hearing the Commission's Director of Transportation provided to the protestants the assistance which had been requested and partici pated actively in the hearing for such purpose. Unfortunately, the demonstrated use of and need for this branch line was not sufficient to convince the Interstate Commerce Commission that the application should be denied and on April l8 an order was issued by that body authorizing the abandonment of this branch line. As is the general practice of the Interstate Commerce Commission in abandonment proceedings of this type this order contained a condition that the applicants would be required to sell this branch line or any portion of that line, including such tracks and other facilities and property as may be essential to the continued operation thereof, to any responsible person, firm or corporation offering within 60 days to purchase the same and willing to pay not less than the net salvage value thereof. A group of citizens of the affected area, led by the representative of an organization proposing to establish a large industrial complex in Clay County immediately south of Fort Gaines, tendered an offer to purchase the line at the salvage value of $58,6 9 7 . Consummation of the sale is being held in abeyance pending the interested parties obtaining from the Interstate Commerce Commission a certificate of public convenience and necessity to operate the line as a common carrier. In September the Commission was informed of the notice issued by the Chicago & Eastern Illinois Railroad advising that under Section 13a(l) of the Interstate Commerce Act it proposed to dis continue operation, effective October 1, 19675 of its Passenger Trains Numbers 5h and 93 operating daily between Chicago, Illinois and Evansville, Indiana. This notice was not sent to the Commission by the Chicago & Eastern Illinois Railroad but was furnished by a representative of one of the labor unions whose members operate the trains. While the application immediately involved service between Chicago and Evansville and did not pertain to operations within the State of Georgia, approval of the application would have eliminated the Evansville-Chicago portion of the "Georgian" passenger trains which run on a daily schedule between Atlanta, -29- Georgia and Chicago, Illinois operating between Chattanooga, Tennessee and Evansville, Indiana over the Louisville & Nashville Railroad and between Atlanta and Chattanooga, Tennessee over the State-owned Western & Atlantic Railroad. The Commission immediately advised the Interstate Commerce Commission of the importance of this passenger train service to the State of Georgia, pointing out that the "Georgian" passenger trains, including the segments proposed to be discontinued, provided the only practical railroad passenger service remaining between Atlanta and the Midwest; that while the "Georgian" only made four stops in Georgia its terminus of Atlanta was an important railroad junction through which passengers were interchanged between points in the Southeast and points in the Midwest served by and via the "Georgian" trains; that discontinuance of this service would leave North Georgia without any practical railroad passenger service to Chicago and the Midwest and should not be permitted without full and conclusive showing of the losses of such service outweighing the benefit to the public. It was further pointed out that this Commission had supported the application of the Louisville and Nashville Railroad to acquire the EvansvilleChicago line of the Chicago & Eastern Illinois Railroad in I.C.C. Docket 21755 and had understood that such acquisition had been approved and was currently in the final stages of effectuation. It was emphasized that inherent in the Georgia Public Service Commission's support of that proposal was the continuance of railroad service via this route, including the passenger services here involved, and that the last through North-South passenger train service over that line should not be discontinued before such acquisition was completed and the new operators given ample opportunity to investigate the feasibility of continuance of the "Georgian" trains in the resultant single carrier operation. In consideration of the many protests against the proposed discontinuance of service the application was assigned for hearing at various points along the Chicago & Eastern Illinois Railroad and a representative of this Commission appeared at the principal such hearing to participate in opposition. At the close of the year no decision had been rendered by the Interstate Commerce Commission in this case. There was reviewed in last year's report the intervention of the Commission in a proceeding before the Interstate Commerce Commission involving the proposal of a number of railroads in the West to acquire control of all or parts of the Chicago, Rock Island and Pacific Railroad (Rock Island). That intervention was in support of control by the Atchison, Topeka and Santa Fe Railway (Santa Fe) of the line of the Rock Island between Memphis,Tennessee and Tucumeari, New Mexico and the resultant prospect of opening up through Memphis another gateway to the West. Hearings continued during this year and a representative of the Commission testified on behalf of the Georgia Public Service Commission (and other Southern Commissions members of the Southeastern Association of Railroad and Utilities Commissioners) in support of the Santa Fe -30- Railway in this proceeding. Hearings are not yet concluded in this case and any decision appears a long way in the future. Not only is the case itself extremely complex because of the many different applications and proposals and the varied effect on other railroads and the public interest , but because of the involvement of the proceeding with other cases involving other mergers of other railroads in the West. It is probable that an overall investigation by the Interstate Commerce Commission into railroad consolidations in the West will be required before this and other pending merger proceedings in that territory are finally resolved. In April the Commission petitioned the Interstate Commerce^ Commission for authority to intervene In another merger proceeding that involving the proposed merger of the Norfolk and Western Railway with the Chesapeake and Ohio Railway. The principal purpose of the Commission in intervening in this proceeding was to support the petition of the Southern Railway Company and the Interstate Railroad Company for imposition on any approval of the proposed merger of appropriate conditions or the inclusion of those two lines in the transaction to the extent of those lines being granted trackage rights over the Norfolk and Western Railway to reach certain coal fields in Virginia and West Virginia located on that line. The petition for intervention pointed out that coal is important to the State of Georgia today and with the growing industrialization of the State would become even more vital in the future and that direct access to the coal fields on the Norfolk and Western Railway by a railroad system serving extensive routes within the State of Georgia (as does the Southern Railway) would increase the availability to Georgia industry of this necessary fuel and make economically feasible and operationally practicable new unit train movements of coal to the State's large industrial users, particularly to its electric power generating plants. Later in April the Commission joined with other Southern State Commission members of the Southeastern Association of Rail road and Utilities Commissioners and the Southern Governors' Conference in a petition to intervene in this proceeding as a region. Both petitions were approved and there was submitted in October by a representative of this Commission a verified state ment detailing the importance of this coal supply to the State of Georgia and pointing out the additional benefits of the merger to Georgia and the South through the competitive service on inter territorial traffic to and from the North made possible by the ability of these merged lines to compete with the Penn-Central System and the possible beneficial effect on the South's position in the Official-Southern Divisions Case of the elimination of duplicated facilities and reduction of costs in the North lowering the pressure for increase in divisions for the Northern railroads in that proceeding. Prior to that statement the Norfolk and Western Railway had agreed to permit the necessary access to its coal fields on coal moving to Georgia and the other Southern States and since that agreement was, of course, contingent upon approval of the merger, this Commission and the Southeastern Association of Railroad and Utilities Commissioners fully supported the merger. -31- UTILITIES DIVISION INTRODUCTION One of the most important functions of the Public Service Commission is the regulation of the public utilities under its jurisdic tion. The Commission has the responsibility of requiring these utilities to provide adequate and satisfactory services compatible with the reason able and just needs of the public at rates that are fair, just and reason able. Contrary to the beliefs of many citizens, the Commission does not guarantee the utility a fixed rate of return or profit. Further, there is no exercise of power over the management of utilities such as organiza tion, operation, etc. At the close of the calendar year 19&7 there were^under the jurisdiction of the Commission the following number of public utilities ELECTRIC. ....................... 2 NATURAL GAS. . . . . . . . . . . . . . * b TELEPHONE(including b C o-ops)............ 50 TELEGRAPH ............. 1 TRANSIT . . . . . . . . ........ . . . . 1 The function of the Utilities Division is to provide the Commission with technical and professional services so that the public responsibilities as required by law can be met. In order to carry out the duties assigned to it by the Commission, a competent technical and professional and administrative staff performs specific functions in the Engineering, Rate, Auditing and Accounting Departments. The work^of the Engineering Department consists generally of processing and analyzing all utility tariff filings which include rates, rules and regulation changes of the telephone utilities, revision of rules and regulations of electric and gas utilities, as well as tariff revisions filed by Western Union. -33- All applications for Certificates of Public Convenience and Necessity for telephone and gas utilities are processed and docketed for hearing. During the formal proceedings, the professional staff conducts the cross-examination of the witnesses, and after the Commission reaches a decision, appropriate orders are prepared and issued. Oftentimes, field investigations have to be conducted to obtain such additional data that may be required to enable the Commission to reach a fair and equitable decision. One of the most important functions of this department is the receipt, processing, evaluation, investigation, and final disposition of all complaints filed with the Commission against the utilities. The staff personnel involved in this work have been given specific training in order that the public may be given prompt and courteous service in the solution of their particular problem. For the purpose of obtaining detailed facts and certain technical data required, many electric, gas, and telephone test instruments are utilized. These expensive and delicate instruments are sent to the laboratory of the U. S. Bureau of Standards periodically for calibration and issuance of Certificates which indicate the tolerances of accuracy. In addition to the foregoing, all Federal Power Commission and Federal Communications Commission publications on Certificates, rates, rules and regulations, and orders are reviewed carefully in order to evaluate same before submission to the Commission for such action as deemed appropriate. The Rate, Auditing and Accounting Department has the responsi bility of assigning all rate and security applications for hearing. When exhibits are filed in these proceedings, a detailed analysis is made in order to determine if the rules of the Commission have been met and at the hearing cross-examination of witnesses is conducted for the purpose of bringing out the facts in the case, thus enabling the Commis sion in reaching a fair and equitable decision. Subsequent to the hearing, and after the Commission reaches a decision, orders are pre pared and issued to implement the decision reached. This department has the tremendous task of auditing all monthly, quarterly and annual reports received from utilities. It is necessary to check for errors in accounting, accuracy of data and conformance with the uniform system of accounts. When discrepancies are found, these are called to the attention of the appropriate utilities1 officials for correction. Rate of return studies are made annually and submitted to the Commission for such action as may be deemed appropriate. Despite the shortage of one engineer, one accountant, and one stenographer, the Utilities Division was able to perform in a creditable manner. The understrength merely resulted in the decrease 1 the volume of overall work which should have been accomplished. The Commission's inability to fill vacant staff positions has been due primarily to the low salary level offered. While the average starting salary for engineering graduates with no experience is about $712 per month, the Utilities Engineer I is rated in grade level Ik at a starting rate of $531 It is expected that some adjustments will be made in the near future. The workload is constantly increasing, brought about by the increase in the number of utilities' customers plus the fact that the suburban areas around the large municipalities present problems of utility facilities being extended in such areas to meet the demands of the public. -3I+- DECISIONS AND ORDERS Applications formally heard "by the Commission are generally taken under advisement and decisions thereon are issued at a later date. The Commission issued 33 decisions and orders during the year^ in proceedings involving utilities. A classification of the proceedings in which formal opinions and orders were issued follows: Applications for Certificates or Cancellation Thereof - - - - - - - 3 Applications for Authority to Issue Securities or Borrow Money Rural Electrification Administration Financing - - - - - - -- 2 Private Financing - - - - - - - - - - - - - - - - - - - " " " 10 Rate Adjustment Proceedings - - - - - - - - - - - - - - - - - - - - 7 Applications for Authority to Purchase and Transfer Utility Properties - - - - - - - - - - - - - - - - - - - - - - - - - - 5 Applications for Ammendments of Certificates - - - - - - - - - - - 3 Show Cause Proceedings - - - - - - - - - - - - - - - - - - - -- - 1 General Orders - - - - - - - - - - - - - - - - - - - - - - - - - - 3 -35- APPLICATIONS FOR CERTIFICATES OR CANCELLATION THEREOF Non-Docket August 2k, 1967 Application of Planters Rural Telephone Cooperative, Inc. for a Certificate of Public Convenience and Necessity for the establishment of a new exchange in Effingham County, Georgia. Non-Docket August 2k, 1967 Application of Southern Bell Telephone and Telegraph Company for a Certificate of Public Convenience and Necessity, "Nunc Pro Tunc," for the establishment of a new exchange at Lake Park, Georgia. Docket No. 2033-U Application of the City of Albany, Georgia for a February l6, 1967 Certificate of Public Convenience and Necessity. -36- APPLICATIONS FOP AUTHORITY TO ISSUE SECURITIES OR BORROW MONEY Docket No. 2O36-U March 15, 1967 Docket No. 20if8-U November 20, 1967 Non-Docket March 6 , 1967 Docket No. 2038-U March 31, 1967 Docket No, 20^3-U July 6 , 1967 Docket No. 2051-U November 27, 1967 Non-Docket February l6 , 1967 Docket No, 2032-U January 13, 1967 Application of Coastal Utilities, Inc. for authority to borrow an additional $935,000 princi pal amount from the Rural Electrification Administra tion, ("REA"), Washington, D, C. Application of The Utelwico, Inc. for authority to borrow $590,000 from the Rural Electrification Administration ("REA"), Washington, D. C. Application of Georgia Telephone Corporation for authority to incur long-term indebtedness in the principal amount of $50 ,000. Application of General Telephone Company of Georgia for authority to enter into temporary loans with banks as well as with its parent corporation for a period of not more than twelve months from date thereof. Application of Walker County Telephone Company for authority to issue shares of Common Stock and Pre ferred Stock in exchange for all of the presently issued and outstanding shares of Common Stock of that Company. Application of General Telephone Company of Georgia for authority to issue and sell to its parent corporation 21+0,000 shares of its $25 par value Common Stock, Petition of Atlanta Transit System, Inc. for authority to incur long-term indebtedness in the principal amount of $252,960. Application of Georgia Power Company for authority to issue and sell $5 7 ,000,000 principal amount of First Mortgage Bonds, 120,000 shares of Preferred Stock and ll+0,000 shares of Common Stock. -37- APPLICATIONS FOR AUTHORITY TO ISSUE SECURITIES OR BORROW MONEY Docket No* 2032-U April 12, 1967 Supplemental Application of Georgia Power Company for authority to issue and sell $57,000,000 principal amount of First Mortgage Bonds, 120,000 shares of Preferred Stock and 1^0,000 shares of Common Stock* Docket No# 20y+-U July 12, 1967 Application of Atlanta Gas Light Company for authority to issue and sell at competitive bidding not more than $2 5 ,000,000 aggregate principal amount of First Mortgage Bonds, Series due * Docket Ho. 201+5-U July 31, 1967 Non-Docket October 6 , 19&7 Application of United Cities Gas Company for authority to reclassify its outstanding $5.00 par value per share Common Stock so as to effect a three-for-two split thereof also, for authority to issue and sell an additional 1*8,775 shares of its Common Stock of the par value of $3 *33^1/3 per share* Ordered that Waverly Hall Telephone Co*, Inc* be authorized to issue "Nunc Pro Tunc" 9^ shares of its $100 par value per share Common Stock to Mr, Julian T. Jones in settlement of an outstanding debt with said company. -38- RATE ADJUSTMENT PROCEEDINGS Docket No. 2023-U February 7, 1967 Docket No. 2023-U February 23, 1967 Docket No. 2037-U March 15, 1967 Docket No. 2018-U April 10, 1967 Docket No. 2018-U June Ik, 1967 Docket No. 2050-U November 27, 1967 Docket No. 2039-U May U, 1967 Application of Thomaston Telephone Company for authority to adjust its rates for local exchange telephone service. Supplemental Application of Thomaston Telephone Company for authority to adjust its rates for local exchange telephone service. Application of Coastal Utilities, Inc. for authority to adjust its rates for local exchange telephone service. Application of Nelson-Ball Ground Telephone Company for authority to adjust its rates for local exchange telephone service. Supplemental Application of Nelson-Ball Ground Telephone Company for authority to adjust its rates for local exchange telephone service. Application of Southern Bell Telephone and Telegraph Company for authority to adjust its local exchange rates in all exchanges in the Atlanta Metropolitan Service Area in order that those exchanges may be placed in their proper rate group. Application of Atlanta Transit System, Inc. and Metropolitan Transit System, Inc. for authority to increase fares for transit bus service. -39- APPLICATIONS FOR AUTHORITY TO PURCHASE AND TRANSFER UTILITY PROPERTY Docket No* 2031-U January 26 , 1967 Application of Continental Telephone Corporation, a holding company of St. Louis, Missouri, for authority to acquire the Capital Stock of Wayne Telephone Co., Inc. of Odum, Georgia, and for authority to do all things required to effectuate ownership, control and management of Wayne Tele phone Co., Inc. Docket No. 2035-U February 13, 1967 Docket No. 1678-U March 17, 1967 Application of General Telephone & Electronics Corporation for authority to acquire all of the out standing capital stock of Mutual Telephone Company, Inc., Manchester, Georgia, and for authority to do all things required to effectuate ownership, control and management of that Company as set forth in the application. Application of General Telephone Company of Georgia ("General") for authority to acquire all the outstanding capital stock of Consolidated Telephone Company, Inc. of Moultrie, Georgia, Broxton Tele phone Company, Broxton, Georgia, and Trion Telephone Company, Trion, Georgia, and for issuance of the securities to be transferred and other securities heretofore issued and to do all things required to effectuate ownership, control and management of said companies as more fully set forth in the application. SUPPLEMENTAL ORDER Docket No. 20K)-U May 31, 1967 In the matter of application of Georgia State Tele phone Company and Wayne Telephone Co., Inc. to merge, with Georgia State Telephone Company to be the surviving corporation, and for authority to do all lawful things required to effectuate such merger. Docket No. 2052-U November 20, 1967 Application of Ralph L. Lineberger, the owner of all the Capital Stock of Gray-Haddock Telephone Co,, Inc, and Jeffersonville Telephone Company, Incorpo rated, for authority to sell such Stock to Mr. LeRoy T. Carlson of Chicago, Illinois, as well as authority to enter into a management con tract between the said two parties. -I4O- APPLICATIONS FOR M O M E N T S OF CERTIFICATES Docket No. 20^2-U August 2k, 1967 Application of Fairmount Telephone Company, Inc. for amendment to Certificate of Public Convenience and Necessity No. 583 to construct new toll facilities along Georgia Highway 53 between Fairmount and the East certificated line of Fairmount Telephone Company, Pickens County, and to construct new toll facilities along U. S. Ull South from Fairmount to the South certificated line of Fairmount Telephone Company in Bartow County, Georgia Docket No. 20Ul-U August 2k, 1967 Application of Southern Bell Telephone and Telegraph Company for an Amendment to its Certificate of Public Convenience and Necessity No. 279 for construction of toll facilities between Fairmount and Jasper. Docket No. 203IMJ February l6, 1967 Application of Atlanta Gas Light Company for Amendment to Distribution System Certificate of Public Convenience and Necessity No. 20 to Include Certain Corridor in Gwinnett County, Georgia. -Ul- SHOW CAUSE Docket Ho. 20^7-U August 28, 1967 Gray-Haddock Telephone Company, Inc. and Jeffersonville Telephone Company, Inc, .1+2 PROMULGATION OF RULES AND REGULATIONS FOR THE EMPLOYMENT AND USE OF SERVICE OBSERVING EQUIPMENT PURSUANT TO ACT 567, ADOPTED APRIL 19, 1967 May 10, 1967 Rules and regulations for employment and use of any equipment or device which is furnished hy a telephone company authorized hy the Georgia Public Service Commission pursuant to Act 56 7, HB 64, adopted by the General Assembly of Georgia, approved April 19, 1967. PROMULGATION OF RULES AND REGULATIONS FOR THE SAFE INSTALLATION AND OPERATION OF NATURAL GAS TRANSMISSION AND DISTRIBUTION FACILITIES Non-Docket May 4, 1967 Non-Docket July 6, 1967 Adoption of rules and regulations pertaining to all of the gas utilities coming under the jurisdiction of the Georgia Public Service Commission. First Supplemental Order to the adoption of rules and regulations pertaining to all of the gas utilities coming under the jurisdiction of the Georgia Public Service Commission. -43- SOUTHERN BELL TELEPHONE AND TELEGRAPH COMPllf Station Activity - General Total telephones in service for Southern Bell in Georgia at the end of 1967 were 1 ,6 3 7,873. This represents an increase in total telephones for the year of 92,959* The inward movement was H7^-,580 and the outward telephone movement was 375 ,1 ^7 * The improvement in service furnished to customers continues, and as of the end of the year 8 0 .1 percent of residence customers had individual line service. This is the highest percentage of one-party line service in the nine states that Southern Bell serves. The number of families with telephones in Georgia served by Southern Bell continues to increase and now approximately 77.^ percent of all families have telephone service. New services and equipments are being developed on a continuing basis in order to keep abreast of customer*s need for new and expanded service. This is evident by the sixty-eight tariff filings that were made with the Georgia Public Service Commission during the past year. Conversions The Madison manual office was converted to dial operation during the year 19 6 7 . This brought the number of dial telephones in the State to 10 0 .0 percent of the total. Direct Distance Dialing Of the total number of main services in Southern Bell in Georgia, 78.2 percent now have access to the Direct Distance Dialing network. The percent customer-dialed long distance messages in 1967 was 2 5 .5 percent of the total messages. Construction During the year 19 6 7 , Southern Bell spent approximately eighty-nine million dollares in Georgia for new construction to provide facilities needed to service customers. Band Mileage During the year, a more liberalized method of applying mileage charges for customers outside of the Base Rate Area in seven exchanges was inaugurated, resulting in a savings of approximately $38,000 annually to customers in these exchanges. As of the end of 1967, 50.7 percent of Southern Bell*s exchanges now apply mileage charges on this liberalized basis. SOUTHERN BELL TELEPHONE AND TELEGRAPH COMPANY (Cont*d) Eight-Party Elimination and Service Improvements in Suburban Areas During the year 19 6 7 , Southern Bell spent approximately $U,166,000 in gross construction in a program of eliminating eight-party service and for service improvements in the suburban areas. During the year, 37,600 new customers were served outside the Base Rate Area and 3 52^-8 eight-party customers were regraded to higher classes of service. At the end of the year, eight-party service represented only 3*1 percent of total customers served. Extended Area Service During 19 6 7 , extended area service was established at ConcordWoodbury; Flowery Branch-Lula; Valdosta-Lake Park; Madison-Rutledge and Wadley-Midville. There are 120 Southern Bell exchanges which can call one or more neighboring exchanges without paying a long distance charge. The Atlanta Metropolitan Calling Area is the largest flat rate calling area in the United States, encompassing over three thousand square miles. Customer Savings Expansion of base rate areas during 1967 and a more liberal method of applying mileage charges resxilted in annual savings to customers of some $38,000. Employees and Wages Southern Bell employs 15>100 people in Georgia* This has increased 200 since January 1, 1967 Dining 19 6 7 , Southern Bell paid its employees in Georgia an amount in excess of $9^,06^,000 in salaries and wages. Taxes During the past year, Southern Bell in Georgia paid in local and State taxes an amount in excess of $15,183,000. In addition, Georgia telephone customers paid over $2,960,000 to the State in sales tax. -1+5- 1 t>0&*9TCl-' : ' h Si *0 L- -:.- rool ai ' INDEPENDENT TELEPHONE CQMPMIES* OPERATIONS The state1s independent telephone industry continued its record growth in 19 6 7 , as new all-time highs were set in plant investment, annual gross revenues, and telephones in service* Of the 2,102 independent companies operating throughout the nation, there are b5 in Georgia, serving over one-half of the geographical area of the state and operating approximately 1 in every 7 telephones (270,000). Plant investment is approximately $125,000,000, with more than $12,000,000 having been invested in 1967 to improve service and expand plant and facilities* These companies employ over 1,800 persons, pay annual taxes in excess of $3*5 million, and collect in excise taxes over $2,000,000 per year. Operating as they do, in the smaller cities, towns, suburbs, and rural areas, which are growing faster in population and disposable income than the large metropolitan areas, their annual rate of growth (7&/o in 19&7) was greater than that of the Gross National Product or the Bell System in Georgia. During 19 8 7 j the Commission's activity with the various independent companies embraced 5 rate proceedings, 6 loan applications, 2 certifi cate matters, and a large number of service requests* Regarding service, our experience would indicate that all companies are proceeding with an up-grade program to meet subscriber demand, improve traffic efficiency, and minimize cost of central office and station equipment* For example, the General System has an objective of offering one-party service to all business customers by 1970, with no more than four-parties served on any line by 1975. Georgia State Telephone (Continental System) estimates that within ten years, 90 per cent of its customers will have one-party service. Standard Telephone, Interstate Telephone and other smaller systems are forecasting one-party and two-party service to all customers within the base rate area, and four-party and five-party service to all rural subscribers by 1970. Equally as significant as the independent telephone growth in 1967? was the decision by this segment of the industry to incorporate its trade association, employ a full-time staff and obtain a permanent office location. It is expected that this move toward a stronger association will strengthen the member companies* position in many areas, and make possible for the first time, a close and continuous liason with the Commission consistent with the public interest. - 1*6 - LICENSING SERVICE OBSERVING EQUIPMENT May 10, 1967 IN RE: Rules and regulations for employment and use of any equipment or device which is furnished by a telephone company authorized by the Georgia Public Service Commission pursuant to Act 567s HB 6h 9 adopted by the ________General Assembly of Georgia, approved April 19a 19&7__________________ BY THE COMMISSION: By virtue of the authority vested and imposed in the Commission by Act No. 567, amending Chapter 26-20 of the Code of Georgia of 1933 and more particularly Section 26-2006 of said chapter, reading in part as follows: 11The Georgia Public Service Commission is authorized to promulgate such rules and regulations in connection with the licensing and revocation thereof of such users of said equipment as will enable it to carry out the purposes, duties and responsibilities imposed upon the Commission by this Section;1' and in the exercise of the powers conferred thereby, it is, ORDERED: That the following rules and regulations are hereby prescribed, adopted and published: RULE 1. Every subscriber of any telephone company authorized to do business in this state desiring the employment and use of any equipment or device which is furnished by a telephone company authorized to do business in this state under proper tariffs filed with and approved by the Georgia Public Service Commission, which may be attached to any telephonic equipment which permits the interception of telephonic communications solely for the purposes of business service improve ment shall make application to the Georgia Public Service Commission for a license for the employment and installation of such equipment on the form prescribed by the Commission, as shown on the attached Appendix !iA", and designated as application for license to use observing equipment furnished by a telephone company,w consisting of three pages. RULE 2. Upon receipt of an application for a license on the form prescribed herein the Commission will, if it deems necessary, designate a time and place for hearing. If a hearing is deemed necessary the Commission will give notice thereof to the applicant and to the telephone company supplying the equipment at least ten days in advance of the date assigned for the hearing. Upon approval of the application a license shall be issued in the form as shown on Appendix nBrt attached hereto and identified as "License to use service equipment furnished by a telephone company. RULE 3. A license shall be revoked by the Commission when it is established to the satis faction of the Commission, after notice and hearing on an order to show cause against the holder of such license, that such equipment is being used in an unlawful manner contrary to the tariff applicable to such equipment, or in a manner contrary to the purposes and uses for which the license has been issued, or if it shall subsequently be discovered a material misrepresentation of fact shall have been made in applying for the license. All other licenses shall be cancelled and revoked upon discontinuance of the use of such equipment, or upon surrender of such license to the Commission. ORDERED FURTHER; That publication of these rules and regulations be given by mailing a copy of this order to each telephone company in this state. BY ORDER OF THE GEORGIA HJBLIC SERVICE COMMISSION, this the 10th DAY OF May______, 19 6 7 . A. 0. RANDALL, SECRETARY CRAWFORD L. PILCHER, CHAIRMAN On April 19s 1967, the General Assembly of Georgia approved Act 56 7, HB 6b, charging the Public Service Commission with the responsibility of regulating the use of certain special equipment furnished by telephone companies for the purpose of listening in on telephone conversations without the knowledge of the original parties to the conversation. This equipment is more popularly known as "eaves dropping1 equipment. In essence, the purpose of the law is to authorize the use of such equipment by companies who are concerned with the training of their employees who have direct telephone contact with customers; and for other reasonably necessary uses. The Commission, on May 10, 19 6 7 * issued its first order in accordance with its new area of responsibility, for the purpose of establishing rules and regulations governing the application and licensing of such installations, A copy of this order and an application form for license to use service observing equipment furnished by a telephone company was forwarded to all known telephone company customers throughout the State, informing them that compliance with the statute was mandatory if such equipment was to be continued -U8- in use. In response, the Commission received application for and issued during 1967, 21 licenses to use such service observing equipments License No. 1 2 3 k 5 6 7 8 9 10 11 12 13 Ik 15 16 17 18 19 20 21 Issued To Delta Air Lines, Inc. Terminal Transport Company, Inc. Sheffield Hardware Company Greyhound Bus Depot of Atlanta, Inc. Eastern Air Lines, Inc. Georgia Power Company Callaway Mills Company Rich's, Inc. Pan American World Airways, Inc. Piedmont Airlines Northwest Airlines, Inc. Southern Airways, Inc. United States Marine Corps Supply Center Home Transportation Company, Inc. United Air Lines, Inc. Correspondence, Inc. Lockheed-Georgia Company Family Publications Service, Inc. Atlanta American Motor Hotel Young's Telephone Answering Service, Inc. Sears, Roebuck and Company Date Issued 5/1 5 / 6 7 5/29/67 5/29/67 6/8/67 6/8/67 6/8/67 6/19 /6 7 6/19/6 7 6 /1 9 / 6 7 6/23/67 7 /12/67 7 /12 /6 7 7 /12/67 7/12/67 7/12/67 7/25/67 7/25/67 7/25/67 8/1 / 6 7 8/1/67 9/7/67 At the end of the period covered by this report, there are additional applications on file which are pending action by the Commission. Due to the fact that this is a new field of regulation, it is anticipated that modifications will be required in the present method of issuing these licenses in order to give full effect to the intent of the Act. -1+9- ATLANTA GAS LIGHT COMPANY EXPANSIONS The Atlanta Gas Light Company's continued expansion program during 1967 extended natural gas service to sixteen towns and cities located generally throughout the state. A total of 178 towns and cities were served December 31? 1967* A monthly average of 22,897 new customers were connected and over 569*000 customers were served during December. The following received natural gas service for the first timei Date City General Location in State 1- 1-67 1-18-67 2- 9-67 2*l4-67 3-15 -6 7 3-15 -6 7 3-3 1 .6 7 4- 6 -6 7 5-26-67 8-17-67 9-14-67 9-28-67 H - 8-67 12 -13 -6 7 12-29-67 12-29-67 CONSTRUCTION Hahira Blythe Flowery Branch Pooler Clarkesville Demorest Grovetown Washington Uvalda Maysville Gillsville Berkeley Lake Zebulon Camak Chatsworth Mountain Park Southern Eastern North Central Eastern North Eastern North Eastern Eastern Eastern South Eastern North Eastern North Eastern Northern Central Eastern North Western Northern Total Utility Plant additions (additions less retirements) for twelve months ended December 31* 1967* amounted to $14,754,152, an increase of 7.8fo over 1966. Construction Expenditures for the Company's Utility Plant during the 1967 fiscal year ending September 30, 19 6 7 , were $1 7 ,8 72 ,365. Of this amount approximately 80$ was for gas mains, service lines, meters and regulators, lU$ for data processing equipment and the balance for general improvements and new equipment. Construction Expenditures for the 1968 fiscal year are estimated to be $1 6 ,000,000 of which $8,290,000 will be for new business in areas presently served, $3,8^2,000 for distribution systems in new areas and the balance for general improvements and new equipment. SALES AND REVENUES Total gas revenues amounted to $100,686,792 which is an increase of $6,222,211 over 19 6 6 . Revenues from large industrial customers increased 20.2$. Total therm sales increased 10.6$ over the previous year even though there was a reduction for space heating requirements. A total of 2 ,9 8 7 degree days during 1967 was 11$ less than the previous year. -50- The Company continued its every effort to not only bringing new industries and commercial business into Georgia but assisted present industrial and commercial customers in their expansion programs and the elimination of air pollution These efforts were responsible for natural gas service being extended to the following: Interstate Paper Company Savannah Electric and Power Co. Regency Hyatt House A & P Tea Company North Georgia Rendering Co. Sherwin Williams Company Weyerhauser Company Chicopee Manufacturing Co. Scoville Manufacturing Co. Besco Products Co. Cotton States Feed Mathis Akins Concrete Block Co., Inc. Franklin Aluminum Co. Atlantic Coast Line Railroad Mathis Akins Concrete Co. Gainesville Junior College North Georgia Technical School Metro Materials Inc. Florida Foliage Inc. Cotton States Fertilizer (Division of Columbia Nitrogen) Packaging Corporation of America Lapp Insulator Co., Inc, RATE REDUCTIONS On May 29* new rate schedules were filed for three classes of Savannah customers with an estimated reduction of $329*956 annually. This was a part of a long range program designed to bring these rates down to the general Company levels. GAS SUPPLY The Company has long-term contracts with its three natural gas pipeline suppliers; Southern Natural Gas Company, Transcontinental Gas Pipe Line Corporation and South Georgia Natural Gas Company. Through sixty-six (66) separate supply points throughout the state 177*70U,229*000 cubic feet of natural gas was received and distributed through approxi mately 12,000 miles of 3" equivalent gas mains. Investigation of potential sites for underground storage in Atlanta's service area was continued throughout 19 6 7 . Test drilling has been done in Floyd County but as yet information is not available for a final determination as to the feasibility of this project. The Company maintains nine peak shaving plants which supply propane air gas in very cold weather or in emergencies. Storage capacity of these plants is 11,851,255 gallons of liquid propane. -51- FINANCING In December 1967? the Company sold at competitive bidding $15,000,OCX) principal amount of First Mortgage Bonds, 7$ Series due 1992, at a slight premium (100.111$) resulting in a cost of money to the Company of 6.99$. The proceeds from this sale were used to repay a portion of short-term notes outstanding. The sale of these bonds was authorized by the Commission in Docket No. 20Ui|--'U. PERSONNEL At the end of 1967 the Company had 2,3^7 employees. GENERAL The general offices, accounting and sales offices of the Company were moved from 2^3 Peachtree Street, N. E., Atlanta, to the Gas Light Tower at 235 Peachtree Street, N. E., Atlanta. A new office was also opened in Alma during the year. 52- DIRECTORY 0 F GEOR G I A TOWNS AND CITIES SERVED WITH N A T U R A L GAS PREPARED BY GEORGIA PUBLIC SERVICE COMMISSION AS OF JULY 1, 1968 Y iFl 0 T D 3 3 I G <;? Q > G ?I A 1 Vf 0 HT IW a I tt r 3 A \) j A H U A A g Ya (T&MSH Vi KBBIM HrO Z O T 'm " o: . IIKG30 dos t i ; tacto 3'.o 3A CITY OWNERSHIP OF SYSTEM Acworth Adairsville* Ailey Alamo Albany Aldora A3lenhurst Allentown Alma Alpharetta Alto Americus Arcade Ashburn Athens Atlanta Augusta Austell* Avera Avondale Estates Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Bainbridge Baldwin Barnesville Baxley Berkeley Lake Bishop Blackshear Blakely Blythe Bogart Bowdon Bowersvilie Bowman Bremen Brunswick Buchanan (Buena Vista) Buford* (Butler) Byron Cadwell Cairo Calhoun Camak Camilla Canon Canton Carlton Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal (Toccoa,) Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal Municipal Municipal (Warner Robins ) Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal (Toccoa) Atlanta Gas Light Company Atlanta Gas Light Company SOURCE OF NATURAL GAS Southern Southern Southern Southern South Georgia Southern Southern Southern Southern Southern Transcontinental South Georgia Southern South Georgia Transcontinental Southern Southern Southern Southern Southern South Georgia Transcontinental Southern Southern Transcontinental Southern Southern South Georgia Southern Transcontinental Southern Transcontinental Transcontinental Southern Southern Southern South Georgia Transcontinental South Georgia Southern Southern South Georgia Southern Southern South Georgia Transcontinental Southern Southern CITY Carrollton Carter sville* Cave Spring Cedartown Centerville Chamblee Chatsworth Chester Chickamauga Clarkston Clarksville Cochran Colbert College Park Columbus Comer Commerce* Conyers Cordele Cornelia Covington Crawford Crawfordville Cumming Cuthbert Dacula Dallas* Dalton* Danielsville Danville Darien Dawson Dearing Decatur Demorest Dexter (Doerun) Doraville Douglas Douglasville Dublin* Dry Branch Dudley Duluth Eastman East Point East Thomaston OWNERSHIP OF SYSTEM SOURCE OF NATURAL GAS Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal (Warner Robins) Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Gas Light Co. of Columbus Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Municipal (Greensboro-Union Point) Municipal Atlanta Gas Light Company Municipal Municipal (Buford) Municipal Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Municipal Atlanta Gas Light Company Atlanta Gas Light Company Southern Southern Southern Southern Southern Southern Southern Southern Southern Southern Transcontinental Southern Transcontinental Southern Southern Transcontinental Transcontinental Transcontinental South Georgia Transcontinental Transcontinental Transcontinental Transcontinental Transcontinental South Georgia Transcontinental Southern Southern Transcontinental Southern Southern South Georgia Southern Southern Transcontinental Southern South Georgia Southern South Georgia Southern Southern Southern Southern Southern Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Southern Southern Southern CITY OWNERSHIP OF SYSTEM Eat ont on* Elberton (Ellaville) Emersesi Empire* Euharlee Evans Municipal Municipal Municipal Atlanta Gas Light Company Municipal (Cochran) Atlanta Gas Light Company Atlanta Gas Light Company Fairburn Fayetteville Fitzgerald Flemington Flowery Branch Forest Park Forsyth Fort Benning Fort Gaines Fort Oglethorpe Fort Valley* Franklin Atlanta Gas Light Company Atlanta Gas Light.Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Gas Light Co. of Columbus Municipal Chattanooga Gas Company Municipal Atlanta Gas Light Company Gainesville Garden City Gibson Gillsville Glennville Glenwood Gordon Grantville Gray Grayson Greensboro* Griffin Grovetown Guyton United Cities Gas Co. Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal (Eatonton) Municipal (Lawrenceville) Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Haddock (Eatonton) Municipal Hahira Atlanta Gas Light Company Hampton Atlanta Gas Light Company Hapeville Atlanta Gas Light Company Harlem Atlanta Gas Light Company Harrison Atlanta Gas Light Company Hartford Municipal (Cochran) Hartley Municipal (Warner Robins) Hartwell Municipal Hawkinsville Municipal Hazlehurst Atlanta Gas Light Company Helena Atlanta Gas Light Company Hephzibah Atlanta Gas Light Company Hinesville Atlanta Gas Light Company SOURCE OF NATURAL GAS Southern Transcontinenal South Georgia Southern Southern Southern Southern Southern Southern South Georgia Southern Transcontinental Southern Southern Southern South Georgia East Tennessee Southern Transcontinental Transcontinental Southern Southern Transcontinental Southern Southern Southern Southern Southern Transcontinental Transcontinental Southern Southern Southern Southern South Georgia Southern Southern Southern Southern Southern Southern Transcontinental Southern Southern Southern Southern Southern CITY Hogansville Holly Springs Hull I la Irwinton Jackson* Jefferson Jeffersonville Je sup Jonesboro Kennesaw LaFayette LaGrange Lake City Lavonia Lawrenceville* (Leesburg) Lexington Lilburn Lithia Springs Lithonia Loganville Louisville* Ludowici Lumber City Lumpkin Lyons Mableton Macon Madison Manchester* Marietta Martin Martinez Maxeys Maysville McDonough McIntyre McRae Meigs Milledgeville Millen Milner Monroe Montezuma Monticello* OWNERSHIP OF SYSTEM SOURCE OF NATURAL GAS Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Dublin Gas System, City of Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Southern Southern Transcontinental Transcontinental Southern Southern Transcontinental Southern Southern Southern Atlanta Gas Light Company Southern Municipal Municipal Atlanta Gas Light Company Municipal (Toccoa) Municipal Municipal Municipal (Greensboro-Uaion Point) Atlanta Gas Light Company Municipal (Austell) Atlanta Gas Light Company Municipal (Lawrenceville) Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Southern Southern Southern Transcontinental Transcontinental South Georgia Transcontinental Transcontinental Southern Transcontinental Transcontinental Southern Southern Southern South Georgia Southern Municipal (Austell) Atlanta Gas Light Company Municipal Municipal Atlanta Gas Light Company Municipal (Toccoa) Atlanta Gas Light Company Municipal (Greensboro-Union Point) Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Municipal Municipal Southern Southern Transcontinental Southern Southern Transcontinental Southern Transcontinental Transcontinental Southern Southern Southern South Georgia Southern Southern Southern Transcontinental South Georgia Southern CITY Montrose Morrow Moultrie Mountain View Mount Airy Mount Vernon Mount Zion Nashville Newnan Norcross (Ochloehnee) Ocilla Oconee Odum (Omega) Palmetto Patterson Payne City Peachtree City Pelham Pendergrass Perry Pine Lake Plainsville Pooler Porterdale Port Wentworth Powder Springs Quitman Remerton Reidsville Rentz Rest Haven (Reynolds) Riceboro Richland Richmond Hill Rincon Ringgold Riverdale Roberta Rockmart Rome Roopville Rossville Roswell OWNERSHIP OF SYSTEM Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal (Dalton) Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal (Austell) Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal (Buford) Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal (Fort Valley) Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Chattanooga Gas Company Atlanta Gas Light Company SOURCE OF NATURAL GAS Southern Southern South Georgia Southern Transcontinental Southern Southern South Georgia Southern Southern South Georgia South Georgia Southern Southern South Georgia Southern Southern Southern Transcontinental South Georgia Transcontinental Southern Southern Southern Southern Tran scontinental Southern Southern South Georgia South Georgia Southern Southern Transcontinental South Georgia Southern South Georgia Southern Southern Southern Southern Southern Southern Southern Southern East Tennessee Southern == CITY Royston* Sander sville Savannah Screven Smyrna Saellville Social Circle Soperton Sparta* Springfield Stapelton Statesboro* Statham Stilesboro Stockbridge Stone Mountain Sugar Hill Sugar Valley Summerville* Sunnyside Suwanee Swainsooro Sylvania Sylvester Talbotton Tallapoosa Talmo Taylorsville Temple Tennille Thomaston Thomasville Thomson* Thunderbolt Tifton Toccoa* Trenton Trion Tyrone Union City Union Point* Uvalda Valdosta Vidalia Villa Rica Waco OWNERSHIP OF SYSTEM Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal Municipal Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal Atlanta Gas Light Company Municipal Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company SOURCE OF NATURAL GAS Transcontinental Southern Southern Southern Southern Southern Transcontinental Southern Southern Southern Southern Southern Transcontinental Southern Southern Southern Transcontinental Southern Southern Southern Southern Southern Southern South Georgia Southern Southern Transcontinental Southern Southern Southern Southern South Georgia Southern Southern South Georgia Transcontinental Southern Southern Southern Southern Transcontinental Southern South Georgia Southern Southern Southern COT Walnut Grove Warner Robins Warrenton Washington Watkinsville Wayeross Waynesboro West Point Whitehall Whitesburg Winder Winterville Woodland Woodstock Wrens Wrightsvilie OWNERSHIP OF SYSTEM Municipal (Lawrenceville) Municipal Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Atlanta Gas Light Company Municipal Municipal Atlanta Gas Light Company Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company Municipal Atlanta Gas Light Company SOURCE OF NATURAL GAS Transcontinental Southern Southern Southern Transcontinental Southern Southern Southern Southern Southern Transcontinental Southern Southern Southern Southern Southern Municipally owned systems thus marked serve in areas outside the county of which it is the county seat, in which case the Georgia Public Service Commission has Jurisdiction over rates and other matters. The Commission has no Jurisdiction whatsoever over municipally owned systems where service is rendered wholly within the county of which it is the county seat. CODE: Southern - Southern Natural Gas Company South Georgia - South Georgia Natural Gas Company Transcontinental - Transcontinental Gas Pipeline Company East Tennessee - East Tenneessee Natural Gas Company (Doerun): Parenthesis marks indicates proposed systems in the South Georgia Natural Gas Company network. These cities will be served by July, 1971* GAS LIGHT COMPANY OF COLUMBUS Property Additions Property additions during 1967 consist primarily of facilities necessary for the extension of service to 9^-9 new customers. The drop in residential construction that was noted in 1966 continued during fiscal year ending August, 1967* Property improvements and additions to plant facilities totaled $373*^3^ for 1967. Sales and Revenues The average number of customers billed during the year was 1,953 or nearly five percent (5^) more than the average billed in 1966 of 1,196. Total revenues from residential, commercial, and industrial sales were $6 ,336,233 ih 1967* Statistical Information Total employees* pay and benefit expenses were $9893800 in 1967* This amounted to an increase of $^7?800 over 1966. The total number of employees on August 319 19675 was 18 3 , two less than on the same date the previous year. Besides the amount charged to operating expenses, additional payroll of $1 ^5,600 was charged to construction accounts and included in the utility plant account at year end. Tax expense increased to $689>OAO in 1967 from $661,^9^- in 196 6 . Real and personal property taxes accounted for most of the increase. In addition to the normal rise due to property additions, total property assessment was raised in 1967 in connection with the statewide reevaluation of public utility properties. Earnings available for common stockholders amounted to $2.02 per share. -53- 'I * |^.*X 1& LrS&tbaJ t & m a Istfat adT ,noi*.!'oirsnoo o bH ELECTRIC UTILITIES Georgia Power Company total to 900,9oi-. The percentage increase over 1966 was 2.8 per cent. Of the new customers, 20,^73 were residential and 3*935 were industrial. Since 1957, Georgia Power Company has added 238,530 customers, a 36 per cent increase over the period 1957 - 1967. Retail electric service is provided to 6h6 cities and towns in 153 of the State's 159 counties. Wholesale electric service is provided to 50 municipal electric systems and 39 rural electric cooperatives. This service spans 97 per cent of the State. Energy Sales Energy sales for 1967 totaled 20,926,833*000 Kilowatt hours. This represented a gain of 6*7 per cent over 1966 and is the first time the Company exceeded the 20 billion Kilowatt hour mark. Operating Revenues The 1967 revenues of $260,U8U,000 were $17*^09,000 above the 1966, an increase of 7.2 per cent. The revenues for 1967 are broken down into the following classifications: Per Cent Increase Over 1966 Electricity Sales to Residential Customers $ 82,U6l ,000 6 .W o Electricity Sales to Industrial 5c Commercial Customers 1^6 , 870,000 Miscellaneous Sales 2 8 ,637*000 Sales Other Than Electricity 2 ,516,000 $2 6 0 , ^ ,0 0 0 8 .2 ka ^.0 7*2$ Securities Issued During 19 6 7 , Georgia Power Company sold 1^0,000 shares of common stock to The Southern Company for $lU,000 ,000. Preferred stock carrying a dividend rate of 6 .1-8 per cent and numbering 120,000 shares was sold for a total cash cor*sideration of $1 2 ,025,000. First Mortgage Bonds with a face value of $50,000,000 and an 'interest rate of 6 .5 per cent were sold for a total cash consideration of $^9,676,000. The proceeds totaling $75*701,000 were to be used in financing the Company's construction program. The Company's most significant construction story of 1967 was its plans to build a $150,000,000 nuclear-fueled electric generating plant on the Altamaha River in Southeast Georgia. Plans were announced to construct a new 700,000 Kilowatt coal-fired generating plant on the Etowah River in Bartow County near Cartersville, Georgia. The plant is scheduled for initial operation in 1971. T c'."! RELIABILITY AND SYSTEM CAPACITY Since the great "blackout" of electric power in the North eastern United States in November, 1965 the Commission has kept constant vigilance of load growth in Georgia and plans the electric utilities have for keeping pace with the customer's demands, Tabulated below is the system generation capacity at the begin ning of 1967 and as of the end of the year: January 1, 1967 Deceiver 31, 1967 Steam Hydro Miscellaneous 3,008,600 KW 1+1+7,000 KW 2,000 KW 3,350,1*00 KW 1+1+7,000 KW 2,000 KW Increase in generating capacity. *3l+l,800 KW Firm capacity from other utilities .............. ,1,053,086 KW Georgia Power System generating capacity..... .3799 1+00 KW TOTAL.......... .1+,892,1+86 KW System peak of 1+,260,500 KW occurred on August 8, 1 9 6 7 . From the above, it seems clear that the company is keeping up its generating capacity to meet customer growth. In addition, 'tie--line" capacity with other utilities of 1,093,086 KW is available to meet any emergency should any unit of a plant fail. Load growth is forecast for future years and generating capacity increased accordingly. In 1968 a 522,600 KW unit at Plant Branch will be on the line, thus increasing system generating capacity . -55- l o K oriv .v;... ' l i ' o q fi t 'j o :! as noieeteoO sM&t ' ' fi >i ficto sit . i l . sdii g sO r-'iJ :? w :X 11 "O snia .ime y " ;y$- m 't Btttti Savannah Electric and Power Company Operations At the end of 19 6 7 , Savannah Electric and Power Company provided electric service to 655699 customers* Sales in KWH for 1967 totaled 1,088,381, an increase of 10*3 per cent over 19 6 6 . Total revenues from all sources amounted to $1 7 ,578,700, which included $72,800 in other electric revenues (other than KWH sales) Cash requirements for construction amounted to $3*960,300 in 1967. During the year, a $1+1,600,000 six year construction program was announced. At the close of 19 6 7 , there were 377 regular employees of the Savannah Electric and Power Company compared to 388 at the end of 1966. -56- WESTER N UM I0H Three major filings were made by The Western Union Telegraph Company during 1967 with the Georgia Public Service Commission, The first was a filing made on February 27* 1967> an<^ involved a revision in the intrastate Telex rate structure to bring the intrastate rate schedule into conformity with the interstate schedules already approved by the Federal Regulatory body* This revision set forth the proposition that Western Union proposes to expand its Telex Service network in the immediate future to include numerous smaller cities in Georgia, and ultimately plans to eliminate the leased charges applicable to users located more than 10 miles distant from a Telex exchange city, thus making the service available to all users, regardless of location, at the basic uniform rates* The following cities in Georgia are tariffed as Telex exchange cities; Albany Atlanta Augusta Columbus Dalton Macon Savannah The proposed rate structure established a uniform rate of seven pulses per minute for all calls between Telex exchange points in the same rate area. This equates to a charge of 17$ per minute at the 2-|$ per pulse rate applicable to the first 3,500 pulses of usage by a customer during the monthly billing period and to 1 O0 per minute at the discount rate of lJ-0 per pulse applicable to usage in excess of 3*500 pulses. The State of Georgia is located in a rate area which also includes the States of Florida, Worth Carolina, and South Carolina. Thus the pulse rate of 7 per minute will apply to calls between Georgia customers and customers located in the above indicated states, as well as to calls between locations within the State of Georgia. This filing was accepted by the Georgia Public Service Commission subject to complaint and further order on March l6 , 1967. The second significant filing was made by -tiie Telegraph Company on May 15* 1967* to extend the expiration date on the regulations and rates applicable to Automatic Computer Telex Service (ACTS) for a further period of one year from June 30, 1967 i June 30* 1968 to permit additional time for the applicant to gain additional experience with this type of service and to finalize plans for expansion of this offering on a nationwide basis. The Commission accepted this filing on May 2k 9 1967. The third filing was made by the Telegraph Company on November 9, 19 6 7 * and petitioned the Commission for authority to place into effect intrastate rate revisions and adjustments that would encompass the following; -57- 1 . An increase in the rates for message telegraph service, other than Press, of approximately 2.9io resulting from substituting a Gj0 upward adjustment in lieu of the present 3!o adjustment. 2. An increase in the TEL(T)EX handling charge from $1*00 to $1.25* 3 A revision in the present Tieline message discount to provioe for a reduction of 10 cents on all messages in excess of 25 per month filed by Tieline in lieu of the present reduction, of the same amount, on all messages in excess of 100 per month* These rate adjustments and revisions would involve an increase in intrastate revenues of no more than $11,555 per annum if granted. The Commission ordered a public hearing in the matter of this filing and set the date for the hearing to be January 10, 1968. The Telegraph Company reported that its Telex network, continues to grow and that installations in Georgia at the end of 1967 were 732, this represents an increase of 1 ^-U installations during 1967* During the year 1967 Western Union completed the installation of its first computer center in the Southeast which is located in the Atlanta building* This computer is a Sperry Hand Univac model Ul8 and is being programmed to provide Automatic Computer Telex Service (ACTS) as well as a number of dedicated private wire switching systems that will replace the present day electro-mechanical systems in use throughout the Southeastern United States. -58- GENERAL INVESTIGATION OF SERVICE, RATES AND PROMOTIONAL PRACTICES OF ELECTRIC AND GAS UTILITIES This important investigation was covered in the Commission*s 1966 Annual Report which indicated that hearing date commenced in March, 1967 The hearing came on as scheduled in Docket No. 2027-U and consumed 12 Pull days of hearing with some 16 witnesses testifying for the interested parties. The transcript in this proceeding comprised some 1,623 pages of testimony and 1^3 exhibits. Hearings were finally concluded on September 21, 1967, but the record was kept open for the receipt of certain additional data as may be required by the Commission. During the conduct of the hearing and subsequent thereto, some h2 request items were filed to augment the exhibits furnished and to satisfy intervenors. Subsequent to the conclusion of the hearings, the staff commenced the monumental task of analyzing exhibits as submitted at the hearings by the utilities and other interested parties. At the close of the calendar year 1967, the staff brief was in the process of preparation for submission to the Commission for careful study prior to the rendition of the decision in the matter. -59- UNDERGROUND RESIDENTIAL DISTRIBUTION SYSTEMS For several years, there has been an increasing interest which has now reached to almost a public demand for Underground Residential Dis tribution electric systems in new subdivisions* The home builders, subdivision developers and others have worked closely with electric utility officials to get the best deal they could for their particular project* This is natural since the aesthetic value of URD has enhanced the value of real estate sold in such projects* Further, the Federal Housing Administration and Veterans Administration are now requiring underground systems if financing is to be through these federal agencies. There have been some exceptions to this requirement in some instances where hardship cases resulted or the project was not found to be economically feasible* In 1966, Georgia Power Company had advised the Commission that a URD policy was being formulated and it would be filed sometime in 1967 when sufficient data had been obtained from experimental projects now underway. On November lb9 1967, Georgia Power Company filed an application with the Commission and same was docketed for hearing under Docket No* 2053-U. The changes in rules and regulations are as follows: C. RETAIL DISTRIBUTION LINE EXTENSION AND SERVICE CONNECTION REGULATIONS: 1 3 * When underground residential distribution is desired, the foregoing regulations shall be modified as follows: (a) The Company will install, own and maintain a 120/2Uo volt, single phase underground system including the service laterals. (b) The maximum the Company will spend for underground residential distribution per dwelling unit that is not fully electrically heated will be 1*5 times the estimated added annual revenue* (c) The maximum the Company will spend for underground residential distribution per dwelling unit that is fully electrically heated will be 1 * 7 times the estimated added annual revenue. -60- (d) A contribution in aid of construction shall be made for the estimated cost in excess of the Company*s maximum expenditure as provided above. In no case shall the contribution be less than $50*00 per service lateral. (e) A Master contract setting forth the obligations and commitments of the parties will be executed prior to the commencement of installation of the underground distribution system. (f) When the owner does not know in advance if electricity will be used for space heating of all the dwelling units, individual five (5) year transferable refunding certificates will be prepared for each unit covered by the master contract* Then, when an electrically heated unit is constructed, the certificate holder will be entitled to a refund based on the original contribution less any contribution that would have been required if all dwelling units had been electrically heated, less $2 5 * In no case shall any refund exceed the amount originally contributed. Because of the tremendous interest in Underground Residential Distribution electric systems, this matter was given wide publicity and advertised in newspapers of general circulation in the areas served by the company, showing the hearing date to be on December 6, 19 6 7 * For just and sufficient cause, this matter was reassigned for hearing on January 175 1968. The results of the hearing in the Commission^ final order will be reported in the Commission*s 1968 Annual Report. -6l- OTHER COMMISSION ACTIVITIES For many years the Public Service Commission has been cooperating with the National Association of Regulatory Utility Commissioners in promoting more effective regulation of public utilities# Three members of the Commission have been appointed on important national committees and have made substantial contribution toward the objective of the Committee assignment. One of the most important National Association of Regulatory Utility Commissioners*Committees is the "Committee on Communications#" Vice Chairman Ben T# Wiggins has been Chairman of this important Committee for several years and has spent a great deal of his time personally in promoting the work assigned to this Committee. This is indeed a great honor for Georgia, since the effort expended by the Committee in cooperation with the National Association of Regulatory Utility Commissioners and the Federal Communications Commission has resulted in the transfer of revenue requirements from intrastate to interstate. With the transfer of revenue requirements, all of the State Commissions, including Georgia, have been able to reduce Intra state Toll Message Rates or reduce charges for miscellaneous services and equipment. This Committee*s work is going on continuously and it is expected more transfers can be anticipated which will permit the state regulatory agencies to continue reduction of Intrastate Toll Message Rates or other miscellaneous charges for service. The Commis sion's Chief Utilities Engineer serves on the Staff Committee of Experts of this Committee which handles all of the complex details and analysis of the information obtained from the Federal Communications Commission and the American Telephone and Telegraph Company, He is also Chairman of the Staff Committee on Education# This national committee conducts a two-week short course each year for regulatory personnel# This is an excellent program for young staff personnel and provides an added fringe benefit that seems to be a necessity in order to attract young men who have recently graduated from college. There has been and still is a critical shortage of engineers in both state and federal regulatory agencies. These agencies are faced with many problems but as the utilities implement new engineering system designs, the integration of automatic equipment with computers, the demand of the public for underground utility systems, the professional staff of the Commissions must be uprated if prestige is to be maintained and an adequate regula tory job be accomplished^ The challenge is here and we have the responsi bility and duty to our citizens to perform in such a manner that the job can be done with the least amount of effort.