WINNEMUCCA - Humboldt Telephone, the telephone company for Denio, Desert Valley, McDermitt, Midas, Orovada, and Paradise Valley, has applied to the Public Utilities Commission of Nevada for a rate increase.
If granted, rates for basic residential telephone service would increase from $10 a month to $14 a month. The basic business rate of $20 a month would not be increased.
Humboldt Telephone Company, owned by Oregon-Idaho Utilities, is classified as a "small-scale provider of last resort," a designation that gives it certain protections and subsidies. The special status recognizes that Humboldt Telephone Company is a small company, and the only option for folks in these small rural communities to be served by land-line telephones.
The Public Utilities Commission works to ensure that public utilities charge fair rates for their services, and that all Nevadans, even those living in remote rural areas, have access to public utility service. The Public Utilities Commission doesn't regulate telephone service by companies which have competition.
When a regulated company serving in Nevada wants a rate increase, that increase has to be justified to the Commission. That justification takes the form of a 100-page application. The application includes complete financial information - income, expenses, debt, taxes paid, profit margin, everything - for a full "test year" for Humboldt Telephone.
"Small-scale providers of last resort" are permitted a profit margin under 10 percent. The Public Utilities Commission controls a fund, the "Nevada Universal Service Fund" (NUSF), which can be used to subsidize small utilities companies to ensure they stay in business if they can't make that percentage of profit while providing utility service at a reasonable price.
The Public Utilities Commission (PUC) requires small providers of last resort to provide their service to remote rural utility customers at a price competitive with what urban customers pay. The rate increase to $14 would meet that criteria as basic telephone service in Reno and Winnemucca costs more than $14.
Humboldt Telephone President Jeffrey Beck told the PUC he is not requesting any other rate changes. He requested a subsidy from the NUSF fund for 2014 of $185,918. Humboldt Telephone Service has applied for a (NUSF) subsidy for 10 out of the past 12 years.
In testimony before the (PUC), Beck said his company has owned six Nevada telephone exchanges since 1995, when those exchanges were purchased from Nevada Bell.
Beck detailed the investment his company has made in upgrades to service since that time, and pointed out that there has not been a rate increase since the company was purchased.
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