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MISSISSIPPI PUBLIC SERVICE COMMISSION, et al. v. SOUTH CENTRAL BELL TELEPHONE COMPANY

DECEMBER 05, 1984

MISSISSIPPI PUBLIC SERVICE COMMISSION, et al.
v.
SOUTH CENTRAL BELL TELEPHONE COMPANY



EN BANC

BOWLING, JUSTICE, FOR THE COURT:

This cause involves an appeal from the May 7, 1982, order of the Mississippi Public Service Commission [MPSC] denying appellee South Central Bell Telephone Company [SCB] a requested rate increase that had been placed in effect under a refunding bond pursuant to the existing statutes.

SCB appealed the order of the MPSC to the Chancery Court of Hinds County. That court reversed the order of the MPSC and remanded the cause to the commission directing that it allow SCB at least a part of the requested rate increase sufficient to permit the company a rate of return of 11.85%.

 Appeal was taken to this court by the Attorney General for the State of Mississippi, the Public Service Commission and Mississippi Legal Services Coalition contending that the Hinds County Chancellor erroneously reversed the commission's order. We agree with the contentions of the appellants for the reasons hereinafter discussed. Consequently, we reverse the order of the chancellor, reinstate the original order of the MPSC and remand the cause to the commission for appropriate further actions.

 A basic consideration in this cause is" why does this state and other states have a public service commission to regulate monopolistic utilities and what are the duties and responsibilities of the commission? "

 The public service commission is an arm of the legislature. Mississippi Public Service Commission v. Mississippi Valley Gas, 327 So.2d 296 (Miss. 1976); United Gas Corporation v. Mississippi Public Service Commission, 240 Miss. 405, 127 So. 2d 404 (1961); Mississippi Public Service Commission v. Home Telephone Company, 236 Miss. 444, 110 So.2d 618 (1959); and South Central Bell Telephone & Telegraph Co. v. Mississippi Public Service Commission 237 Miss. 157, 113 So.2d 622 (1955).

 In setting up the MPSC, the legislature provided" Subject to the limitations imposed in this article and in accordance with the provisions hereof the public service commission shall have exclusive original jurisdiction over the intrastate business and property of public utilities. . . . "[MCA 77-3-5 (1972)].

 The legislature wisely has provided personnel and funds for the operation of the three-man public service commission. For example, the budget for that commission including its 115 full-time employees and staff members, for the current year is approximately $3,000,000 more than the budget for this nine-man court and its limited staff. The reason for this is obvious. The many staff members of the public service commission, in addition to those hired under the contractural services budget allowances, permits and indeed requires the public service commission to have experts available at all times in all fields of utility regulations and necessary implementation thereof, such as finance, corporate structure, etc. This establishment and extension of the commission, as an arm of the legislature, has resulted in certain rules, regulations and principles of law governing the actions of the commission. These principles of law repeatedly have been emphasized by this Court over the years. In order to put a further discussion of our actions in this particular case in perspective, we need to list some of those established principles.

 In submitting a request to the public service commission for a rate increase, the utility involved has the burden of proving by substantial evidence that it clearly is entitled to the requested increase. State of Mississippi, ex. rel., etc. v. Miss. Public Service Commission,

 435 So. 2d 608 (Miss. 1983); Mississippi Public Service Commission v. Mississippi Power Company, 429 So. 2d 883 (1983); Mississippi Public Service Commission v. Mississippi Power Company, 337 So.2d 936 (Miss. 1976); and Southern Bell Telephone & Telegraph Company v. Mississippi Public Service Commission, 237 Miss. 157, 113 So. 2d 622 (1959).

 It is established that the order of the regulatory body - the public service commission - presumptively is considered valid. In Loden v. Mississippi Public Service Commission, 279 So.2d 636 (Miss. 1973), we said:

 As we have held many times, the findings of the public service commission are prima facie correct and as a reviewing court, we will not substitute our judgment for the judgment of the commission. We are legally bound to uphold that finding of the commission because there is substantial evidence in the record supporting such findings and the ruling of the commission is not capricious, arbitrary or manifestly against the evidence.

 The public service commission, with its expertise, is the trier of facts and within this province it has the right to determine the weight of the evidence, the reliability of estimates and the credibility of the witnesses. The commission is free to accept or reject recommendations of any of the witnesses. State of Mississippi, ex rel. v. Mississippi Public Service Commission, 435 So. 2d 608 (Miss. 1983); Mississippi Public Service Commission v. Mississippi Power Company, 429 So. 2d 883 (Miss. 1983); Mississippi Public Service Commission v. Mississippi Power Company, 337 So. 2d 936 (Miss. 1976); Capital Electric Power Association v. Mississippi Power & Light Company, 216 So. 2d 428 (Miss. 1968); and South Central Bell Telephone & Telegraph Company, v. Mississippi Public Service Commission, 237 Miss. 157, 113 So. 2d 622 (Miss. 1959).

 The reasonableness of the rates charged, or to be charged, by a public utility is not determined by definite rules and legal formulas, but is a fact question requiring the exercise of sound discretion and independent judgment in each case. Miss. Pub. Serv. Comm'n v. Ms. Power Co., supra; and Southern Bell Tel. & Tel. Co. v. Miss. Pub. Serv. Comm'n, supra.

 The rules and requirements of appellate review of a commission order clearly have been defined. First, we have the requirement set up by the legislature in regard to its administrative arm, the commission. MCA 77-3-67 (1972), authorizing a court appeal from the commission's order requires that:

 The order shall not be vacated or set aside either in whole or in part, except for errors of law, unless the court finds that the order of the commission is not supported by substantial evidence, is contrary to the manifest weight of the evidence, is in excess of statutory ...


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