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ill Installing the service connection ia net capitalised but la treated u an operating expense. A change at this tlna, 1, a* for tbs rata ease, would not ba advantageous to the Company unlaaa the 4809 service con- naationa now in servles ware capitalised and included in the rata base. Tim other important items in this revenue elaeelf lection represent penalties in the amount of $1044.86 for failure to pay water bills on tine. Operating Expensest Only United dlaouaaion will ba given at this tine* The neat inportant item la of course the purehasa price of water, dona of the nore Inportant points nay be aat down as follows* Coat of water to LVLMFCo. .» The summary results of operation aa aat forth on page 8 reflects important changes in the billings ae now rendered. Such changes Include t 1 - Bee of a depredated capital baee. 8 - Reduction in the annual depreciation percentage from 0 bo approximately l.qf on the Original Cost and l,qf on the reproduction oust* 6 - The elimination of the ad valorem tax charge at the $l.7& rate on the "investment in the properties and the sub­stitution therefor of a proportionate part of the tax paid on the land to the city. IjSB 4 - The Indus ion of a federal Income tax, conforming to a 0,0 and 6-5/4^ rate of return.