PUC Rejects Pacific Bell Increase, Orders Rates Cut

The state Public Utilities Commission rejected Pacific Bell’s request for an immediate 12.8% telephone rate increase today and instead ordered a slight decrease, citing lowered inflation and technology-related reductions in labor costs.

“It is time for the ratepayer to start benefiting from this modernization,” commission member Victor Calvo said before the 5-0 vote.

The PUC ordered Pacific Bell to reduce its rates by $18.2 million, an average decrease of 0.31% for its 8.2 million customers.

The company had requested an increase of $492 million, or 12.8%, for expenses in 1984 and 1985.

Pacific Bell Vice President L. Reed Waters told reporters that the PUC was being unrealistic in its projections of lower labor costs and greater productivity. “We don’t beat people on the head and tell them to work harder,” he said.

The commission has not yet acted on Pacific’s reduced request for a $950-million rate increase for 1986. On Tuesday, Pacific Bell said it was reducing that rate request from $1.362 billion to about $950 million, or 20.8%. (Story, Page 3.)

In a separate action today, the commission approved a rate increase of $77 million, or 4.83%, for General Telephone Co., which has 2.6 million customers.