upr000062 178

V Page 36 Cont1&. Page 37, P^e 33. Page 39. fully outlined in my letter of April 28, 1950 to i>;r. Reinhardt. The recent decision of the Supreme Court in the Brown Shoe case has, I believe, k direct bearing on this problem of handlin' these advances and since they are made by sub—dividers who make a profit out of the deal, ” I~axa of The opinion they do not cone under the classification of "customers" as defined in the Detroit Edison Case. In this connection also think the word "Donations" should be deleted when referring to advances. Sheet 5 of 6. Is it not the intentior by that portion of advances instead of the portion that in this second paragraph? Last part of paragraph should be changed to "plus and supplies11. to reduce the Rate Base that will not be refunded, will be refunded as stated "plus working capital" working cash and material Last of 2nd paragraph shows net earning (1942 to 1945) in the red to the extent of §65,623/ This should be §55,623, based on Table 1, page 16a. "Customer Advances in Aid of Construction". I believe the first word in this heading "Customer" should be eliminated, since as stated on page 39, these advances have been made almost entirely by real estate sub-dividers. The paragraph following the tabulation states that the initial advance collected includes 10fb for super­vision and overhead and, while subject to refund, is not capitalized. This, however, does not apply in all cases. The statement furnished Hr. Reinhardt with Hr. White1s letter of April 4, 1950, lists 4l contracts with a total of §223,310.04 subject to refund. Mr. White has fur­nished me an analysis of this amount which shows that of the 4l contracts the deposits in the case of about half of then did not include this 10,£ additive, of which the following are a few examples: Contract 11 11 10427 (W.O, 574-1) charged to Investment 10470 (W.O. 608) » to " 10488 (W.O. 6l4) “ » « §12,030.00 17,562.^0 60,030.63 The above amounts charged to investment are also the amounts shown on statement above referred to in column headed "Total amount subject to refund".