Summary
In Ohio Commt. of Cent. Station Electrical Protection Assn. v. Pub. Util. Comm. (1977), 50 Ohio St.2d 169, 174, 4 O.O.3d 369, 372, 364 N.E.2d 3, 6, we held that this court "will not reverse an order of the commission * * * without a showing of concomitant harm or prejudice."
Summary of this case from Industrial Energy Consumers v. Pub. Util. CommOpinion
No. 76-1105
Decided June 15, 1977.
Public Utilities Commission — Telephone companies — Private-line rate increase — Elimination of cost differential — Not withdrawal of service, when.
1. Where the record demonstrates that the applicant telephone company presented evidence in support of the private-line rate increase upon which the Public Utilities Commission could conclude that applicant had met its burden of proof, this court will not disturb the commission's finding.
2. The Public Utilities Commission's authorization of the adoption by applicant telephone company of a uniform rate for three classes of private-line service, based upon the elimination of a previously existing cost differential that allowed the prior rate spread, does not constitute an abandonment or withdrawal of service within the meaning of R.C. 4905.20 and 4905.21.
APPEAL from the Public Utilities Commission.
On November 7, 1974, The Ohio Bell Telephone Company (Ohio Bell) filed with the Public Utilities Commission (commission) an application, pursuant to R.C. 4909.18, for authority to increase its rates and charges. The Ohio Committee of Central Station Electrical Protection Association (appellant) limited its intervention in this matter to opposition to the proposed increase in rates and the elimination of rate categories for private-line circuits.
Appellant is an association of 28 burglar and fire alarm companies doing business in Ohio. Private-line telephone circuits are used by these companies as the means of transmission of their alarm signals to monitoring stations. The type of line normally required for this function is a simple sub-voice grade line. Ohio Bell's prior rate structure contained a separate, lower tariff for these sub-voice grade lines, referred to as Series 1000. Ohio Bell sought, through this rate increase application, to eliminate the distinction contained in the prior rate structure between sub-voice grade and voice grade lines, thereby charging a single tariff. Ohio Bell presented evidence to the commission that it has not, for a period of time, installed lines capable of only sub-voice transmission; instead, it used a universal-type cable which is capable of transmitting both sub-voice and voice signals. Therefore, Ohio Bell contended that there no longer exist any reasons for the distinction in rates because all private-line telephone service is transmitted over the same type of lines.
The commission, by its order of July 8, 1976, essentially accepted Ohio Bell's proposals relating to private-line circuit tariffs, authorizing a tariff of $6 per month per subscriber loop and eliminating the prior rate distinction between sub-voice grade and voice grade circuits. Ohio Bell filed its adjusted tariffs as instructed by the commission's order. The commission, by its July 14, 1976, entry, approved the tariffs as filed. Thereafter, appellant filed applications for rehearing, which were subsequently denied by the commission.
The cause is now before this court upon an appeal by the appellant as a matter of right from the order of the commission, issued July 8, 1976, and its procedural entries, dated July 14, 1976, and August 11, 1976, granting Ohio Bell authority to increase its rates.
Messrs. Vorys, Sater, Seymour Pease, Mr. Sheldon A. Taft and Mr. Lance W. Schneier, for appellant.
Mr. William J. Brown, attorney general, Mr. Charles S. Rawlings, Mr. John W. Bentine and Mr. Kevin F. Duffy, for appellee Public Utilities Commission.
Mr. Donald W. Morrision, Mr. Charles B. Ballou, Mr. Ronald L. Orloff, Messrs. Jones, Day, Reavis Pogue, Mr. Victor E. DeMarco, Mr. Lanty L. Smith and Mr. John W. Edwards, II, for intervening appellee Ohio Bell Telephone Company.
Appellant contends that the commission committed five errors in approving and implementing the rate increases for private-line telephone services. These alleged errors present the following questions to be decided by this court.
(1) Has the commission failed to impose upon Ohio Bell the burden of proving the unreasonableness of its existing rates and the reasonableness of the proposed rates?
(2) Are the approved private-line telephone rates unlawful if not based upon actual operating expenses but upon trended expenses?
(3) Have the orders approving the increased rates effectively authorized Ohio Bell to abandon offering private-line telephone service without compliance with R.C. 4905.20 and 4905.21?
(4) Have the July 8th order and the August 11th entry of the commission resulted from meetings not in compliance with Ohio's "Sunshine Law," R.C. 121.22?
(5) Are the commission's orders of July 8th and July 11th unlawful for the failure to state findings of fact supported by the record and failure to state reasons supporting the conclusions in accordance with R.C. 4903.09?
Appellant bases its first assertion, that the commission ignored the burden of proof requirement on Ohio Bell and imposed that burden upon appellant, upon the absence of any discussion in the order of the burden of proof as to these specific rates. Appellant further relies upon the following sentence in the commission's July 8th order:
"It appears that CSEP has failed to establish a difference between the needs of alarm companies and those of other subscribers utilizing private line service."
Ohio Bell had the burden of presenting evidence to support the increase in private-line service rates. A review of the record shows sufficient evidence upon which the commission could conclude Ohio Bell had met its burden. The evidence presented to the commission upon these particular rates not only indicated that there was no basis for the previous distinction between the rates in question, but further demonstrated by two cost studies and a value of service consideration the reasonableness of the proposed private-line rates. No additional support for appellant's first assertion of error is derived from the sentence in the order cited by appellant. This statement, when read in context, is merely demonstrative of the commission's finding that Ohio Bell had established justification for a single rate for private-line service and that appellant had failed to rebut this evidence or establish any grounds for an exception. Therefore, in light of this court's previous holdings that the findings of the commission will not be disturbed unless they are manifestly against the weight of the evidence and are so clearly unsupported by the record as to show misapprehension or mistake or willful disregard of duty ( Delphos v. Pub. Util. Comm., 137 Ohio St. 422, 424), and the disutility of requiring the commission to specify its assignment of burden of proof, appellant's first assignment of error is rejected.
In its second proposition, appellant does not attack either the use of the RCN technique in determining the rate base or the annual gross revenue determination made by the commission; therefore, these issues are not before this court for determination. Instead, appellant urges that Ohio Bell is limited to the recovery of actual operating expenses, pursuant to Ohio Edison Co. v. Pub. Util. Comm. (1962), 173 Ohio St. 478. However, the cost studies were not evidence of allowable annual expenses, but only evidence to justify these specific rates. The trended expenses were used to provide the current cost of providing the service, as opposed to the historical cost, in justifying the rates for the private-line service. Despite the fact that trended expenses were used in the cost studies to determine specific rates, all the rates for all of the services rendered by Ohio Bell are constrained by law to produce in the aggregate only the gross annual revenue allowed by the commission. The trended expenses were not used in determining Ohio Bell's revenue requirements and thus were not violative of the rule of law espoused in Ohio Edison Co. v. Pub. Util. Comm., supra.
The findings of the commission read, in part: "(18) The rates ordered by the commission will generate revenue equal to the revenue authorized by the commission."
Contrary to appellant's third contention, the commission's approval of the rates for private-line service did not constitute an abandonment of a previously offered service. The quality and availability of service has not changed as a result of the commission's order. The commission merely authorized the adoption of a uniform rate for the three classes of private-line service based upon the disappearance of the cost differential which once existed, permitting the previous spread of rates. Furthermore, testimony was presented that installation of sub-voice grade circuits would be more expensive than the current usage of voice grade circuits. Under the circumstances, sub judice, the allowance of higher rates to reflect the increased cost of service does not constitute an abandonment or withdrawal of service within the meaning of R.C. 4905.20 and 4905.21.
Next, appellant asserts that the rate increases are void, because the order is invalid under R.C. 121.22, alleging the order resulted from deliberations in meetings, advance notification of which was not reasonably available to the public. However, appellant has not claimed that it was in any manner prejudiced by this absence of notice. This court will not reverse an order of the commission upon an assignment of error without a showing of concomitant harm or prejudice. Cincinnati v. Pub. Util. Comm. (1949), 151 Ohio St. 353; Ohio Edison Co. v. Pub. Util. Comm., supra ( 173 Ohio St. 478); Worthington Hills Civic Assn. v. Pub. Util. Comm. (1976), 45 Ohio St.2d 11.
Appellant's final contention, that the orders of July 8th and July 11th are unlawful because the commission failed to set forth adequate reasons supporting its conclusion, was not raised in appellant's applications for rehearing. R.C. 4903.10 reads, in pertinent part:
"Such application shall be in writing and shall set forth specifically the ground or grounds on which the applicant considers said order to be unreasonable or unlawful. No party shall in any court urge or rely on any ground for reversal, vacation, or modification not so set forth in said application."
Thus, appellant may not now urge this court to consider this error.
Accordingly, the order of the commission is affirmed.
Order affirmed.
O'NEILL, C.J., HERBERT, CELEBREZZE, W. BROWN, P. BROWN and SWEENEY, JJ., concur.