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p i§ I m I P Mr. W. H. Johnson Mr. Calvin M. Cory) t December 4, 1951 Fils 4705-11-22 Mr. Robert A. Allen, Chairman Public Service Commission N m . R. State of Nevada PEC (5 “.951 Carson City, Nevada Dear Mr. Allen: Re: Las Vegas Land and Water Company, I & S Docket No. 1 2 7 _________ This will refer to our recent telephone conversation con­cerning the rates on motels with respeot to which I wrote Mr. Lee S. Scott on November 27, 1951. In our telephone conversa­tion you suggested that the Las Vegas Land and Water Company give consideration to voluntarily placing in effect the motel rates which were proposed by the Las Vegas Land and Water Com­pany in Exhibit "W" in I & S Docket 127 for application to mo­tels as distinguished from bungalow oourts. As stated in my letter to Mr. Scott, the rates which were set forth in Exhibit MWM were only a part of the proposal of the Water Company. Our proposal of those rates was related to our other rate propos­als contained in Exhibit f,VM. If the rates which we proposed in Exhibit "V" and in Exhibit "W" had been allowed to go into effect, the Water Company would have increased its revenues by approximately #90,813 a year, using 1951 as the test year. The rates prescribed by the Commission in its order of August 2 4 , 1951, allowed an increase of only approximately #25,000 a year. Under the allowed increase the Water Company is earning no re­turn at all and is suffering a defioit. If we were to place in effect the rates shown in Exhibit f’Wfl the revenues of the Water Company would be further de­creased because they would return less revenue than the rates for motels prescribed by the Commission in its order of Aug­ust 24, 1951. We can see no Justification for any voluntary action on our part which would result in a decrease in our revenues in view of the fact that our revenues under the Com­mission- prescribed rates are entirely Inadequate. Further­more we think it would be Improper for the Commission to or- DEC 5 1951 C* C,