REPORT OF THE GOVERNOR OF THE VIRGIN ISLANDS + 95

good will and mutual respect. This Commission has settled and
adjusted complaints without publicity and in a spirit of fairness and
good will.
 The local communities are mindful that the true goal of a demo-
cratic society is the fair and equal treatment of all its citizens and
that this fair and equal treatment must be carried forward in a spirit
of good will and harmonious relations.

 Public Utilities Commission
 The work of the Public Utilities Commission was greatly intensi-
fied during the past year. In addition to dock facility and bus trans-
portation rates and regulations already under regulation of the Public
Utilities Commission, the Virgin Islands telephone system which was
transferred in an earlier year by government franchise to private
ownership, came under Public Utilities Commission regulation. The
new Virgin Islands Telephone Corp. was formed, and a completely
new automatic dial telephone system was being installed in all three
islands of St. Thomas, St. Croix, and St. John at a total cost in the
neighborhood of $5,000,000 to commence operations about Decem-
ber 1, 1962.
 This new development placed upon the Public Utilities Commis-
sion the responsibility to determine many vital questions for the op-
eration of the new public utility, including among many others: (1)
Fair capital structure allowance; (2) revenue needed for operational
expenses; (3) revenue requirements needed above operational ex-
penses for return on capital investment; (4) rate of fair return on
capital investment; and (5) ultimately the actual telephone rates
authorized to be charged its customers.
 Hearings held by the Virgin Islands Public Utilities Commission
lasted many months. Both sides presented voluminous evidence and
expert testimony by many witnesses. These hearings were completed
and orders entered for the first year of the new operation, the rates
to take effect upon the cut-over date to the new system.

 Selective Service Operations
 The registration during the year of 445 men attaining age 18 raised
the total Selective Service registrants to 5,329, covering ages 18 to 39.
Since 1958, new registrations have been increasing steadily year by
year, from 274 in 1958 to 307 in 1959, 376 in 1960, 380 in 1961, and to
445 in 1962. The higher birth rate experienced during World War II
is now being reflected in this augmented manpower reserve.