38 Other Views Advance

Ocean

Cleanup The U S (Environmental Protection Agency is under pressure on two fronts to live up to provisffms of the 1972 Marine Protection, Research and Sanctuaries Act enacted to end the widespread practic? of disposing of vast quantities of wastes in the weans In a federal court in Newark, N J.. and on Capitol Hill efforts are under way to force an exceedingly reluctant EPA to comply with terms of the law Amendments to the law will be introduced in a House Merchant Marine and Fisheries subcommittee within a week or so They would strengthen the program to end random ocean-dumping and to bring the United States into compliance with an international agreement banning disposal of hazardous materials in the ocean Leading the effort on these changes are U S. Reps Thomas B Evans iR , Del.) and William J. Hughes (D., N.J.). In the court action, a petition was filed last week by the National Wildlife Federation and its New Jersey affiliate and Reps Evans and Hughes They seek to intervene in ongoing negotiations between the EPA and several municipalities in New Jersey to relax deadlirrs to halt dumping sewage sludge off the New Jersey coa. t. The petition was filed because of growing concerns that the EPA would allow the ocean-dumping to continue, contrary to the terms of the law. If the court grants the petitions intervenor status, as it should, they could do what the EPA should be doing: arguing to move forward with the program to end ocean-dumping. The amendments merit prompt action by the Congress. They would set a three year deadline for the EPA and the Army Corps of Engineers to designate environmentally safe ocean dumpsites Only those sites identified as safe could I»e used after the deadline Although the EPA and Corps were required under the law to identify safe dumpsites, they have been lax and completed only a few studies Meantime, dumping of a variety of wastes continues at more than 100 ocean sites. The amendments also would make ocean-dumping of slude a disposal method of last resort The revision is necessary, proponents argue, because of a recent federal court decision which allows New York City to continue its sewage dumping off northern New Jersey. The proposed change requires that if a "prudent and feasible" alternative to ocean disposal exists^! must be utilized even if it is more costly. Finally, the amendments would bring the United States into compliance with the London Ocean Dumping Convention, which bans ocean disposal of certain hazardous chemicals not specifica.’ • prohibited under terms of the 1972 U S law The Congress must si p in quickly to do the job that the EPA should be doing A. tion on the changes in the law. as well as a favorable decision by the federal ledge in Newark oh the petition lo intervene, would markedly advance the vital task of cleaning up the oceans Philadelphia Inquirer editorial. April 22.

reader's forum Needed: Vote on Local Budgets

by John B. Wade In 1979 I fulfilled a lifetime ambition by retiring to Lower Township. There were other, more attractive, areas but I could not afford them. I now see three thrMts to my ability to stay in this area: • Our township governing body views more ratables as the only solution to the township financial problems.

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Editor General Manager St Advertising Coordinator Publisher

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This type of attitude could very well lead to growth that would make the area no longer attractive to those of us who saw fit to settle here. • Constantly rising utility costs are putting many of us in the position where we have to revert to antiquated methods of heating our homes to maintain a reasonable comfort level. Just look at the number of retail outlets now selling kerosene. Kerosene heaters are certainly a far cry from the old fashioned ones but unfortunately present a health and safety hazard. • Our municipal taxes went up subsantially in 1982, against the obvious wishes of the majority of residents. 1983 will most surely bring another increase. Road work to be done in 1982 will be bonded and paid in future years with a finance charge tacked on. ALL OF THESE PROBLEMS STEM from the fact that our elected officials, once in office, choose to ignore the wishes of the taxpaying residents. This was clearly evident in the decision by two of our three Committee people voting Yes for the 1982 municipal budget. One way to got our elected officials to be more responsive to the wishes of the people who pay their salaries is to get better control over how they use our tax dollars. This will not happen until we ail get on the bandwagon to force our state legislators to enact legislation where municipalities must submit proposed budgets to the voters for their approval or rejection. We now have that ability with school budgets and it has resulted in a limited amount of fiscal responsibility in educating our children. Please write your state legislators demanding this type of legislation giving us this ability, and let’s also insist that our township governing body have a public work session when they get down to preparing the 19B3\ budget. Q John B. Wade is a North Cape May resident.

Utility^ Would Use Half Its Rate Bid To Pay Its Taxes

J by Arthur R. Hall Atlantic City-Electric sent the attached response to my letteiMn them of April 26. wherein I requested of .them why they feel they need a 30% to 40% rate increase Atthur Hall ix,ti Wildwoqd Crest resident and electric utility customer b> Brian A. Parent I am in receipj of your letters of March 29 and April 26, and <Community Relations director Matt) Custer's response to your initial letter As a shareholder of the Company, an employee, of to' Company directly involved in our rate request and a rate payer of the Company. I appreciate you! - concerns Your core statement is "Despite the fact that you already receive far more for your electricity than others, you are asking us for an additional 30% to 40% You have said why your rates are high; you have not said why they must be much higher." Before addresimg the additional 30% lo 40% point. I would like to review a few facts: • Most electrid utility bills are composed of two rates, that is. the base rate and the fuel charge. The final charge is a component designed to recover only the cost of fuel not provided for in the base rate and does not projvide for any non-fuel costs (other than taxes) or any coptrihution toward investor return The v hast* rate is designed to recover non-fuel operating and maintenance costs; depreciation, taxes, the cost of bor rowed money, a return to the shareholders of the Company and the primary portion of the fuel cost. • Atlantic Electric has consistently had the lowest electric rates of any investor owned utility in New . Jersey for the last seven years. • The comparison you make to the national average is not totally representative of the ongoing situation While

reasons Mr. Custer mentioned, in addition to others, such as more restrictive environmental regulations, the 67% is not representative. It reflects a time period when the fuel charge portion of the rate was set at a level higher than the .then current cost of fuel in order to recover in excess of $60 million of fuel costs which were incurred in 1980 and 1981 and were not billed to the customers at the time of their incurrences • The base rate request is a 30% to 40% increase in base rates However, it does not accurately indicate the impact on the customers bill. Should the New Jersey Board of Public Utilities grant the entire amount re-

Revenues less Operating Expenses plus both »he debt and equity portion of Allowance for Funds Used Dur-

ing Construction.

Our last increase in base rales was effective during September, 1980 reflecting the Company's rate base, rate of return and adjusted operating income as of June 30, 1980 The current proceeding for the most part reflects the Company’s rate base, rate Of return and adjusted operating income as of September 30, 1982. Since final determination on this request is not anticipated until the latter part of 1982. our request also includes some adjustment for circumstances in early 1983 when the

In order to net $81 million...it is necessary to receive more than .$81 million to allow

for the payment of additional taxes

quested ($172 million ) it would be after a decrease of over $100 million in the fuel charge portion of the rate. Thus, the impact on the consumer’s (you and I) total bill would be more.like 10% to 15%. THE BASE RATE REQUEST ($172 MILLION) currently pending before the New Jersey Board of Public Utilities is essentially composed of three elements as folllows: 1) Rate Base — Net investment is plant and equipment plus materials and supplies and working capital less accumulated deferred federal income taxes. 2) Rate of Return — Weighted cost of capital consisting of the average cost of long-term debt and preferred stock and a fair and reasonable return to the shareholders of the Company. 3) Adjusted Utility Operating Income — Operating

rates will be in effect. As a result of our last increase in base rates, the New Jersey Board of Public Utilities determined that an overall fair and reasonable rate of return at that time was 10.15% consisting of an average cost of debt of 8.0% and a 13.75% return to the Company’s shareholders. As of year end 1981, the Company only earned 9.8% on rate base and only provided a 12.2% return to the shareholders. With additional upward adjustment in rates these returns will decline to 8.3% and 9.3% respectively by year end 1982 THE REASONS FOR THIS DECLINE can best be explained by reviewing the changes that have occurred in the three elements described previously, as follows: Rate Rase — Since June, 1980 the investment in plant and equipment has increased by approximately $300 (Page 39 Please)