20220722Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER ANDERSON
COMMISSIONER CHATBURN
COMMISSIONER HAMMOND
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:JOHAN E.KALALA-KASANDA
CLAIRE SHARP
DATE:JULY 26,2022
RE:CUSTER TELEPHONE BROADBAND SERVICES,LLC'S 2021
BROADBAND EQUIPMENTTAX CREDIT;CASE NO.CTB-T-22-01.
BACKGROUND
In 2001,House Bill 377 was enacted authorizing income tax credit for the installation of
qualifying broadband infrastructure in Idaho.Idaho Code §63-3029B(3)(a)(ii).In particular,
Section 63-30291 allows a taxpayer to receive an investment tax credit for eligible broadband
equipment installed during a calendar year.
Qualified broadband equipment is defined as those network facilities capable of
transmitting signals at a rate of at least 200,000 bits per second (bps)to a subscriber and at least
125,000 bits per second from a subscriber.Idaho Code §63-3029I(3)(b).If the equipment is
installed by a telecommunications carrier,it must also be "necessary to the provision of
broadband services and an integral part of a broadband network."Idaho Code §63-
3029I(3)(b)(i).To be eligible for the tax credit,the taxpayer must obtain from the Commission
an order confirming that the installed equipment meets the statutory definition of qualified
broadband equipment.Procedural Order No.35297 and Idaho Code §63-3029I(4).Once the
Commission has determined the installed equipment is eligible for the broadband equipment tax
credit,an order along with the original Application is forwarded to the Idaho State Tax
Commission.
DECISION MEMORANDUM -)-JULY 26,2022
THE APPLICATION
On June 2,2022,the Commission received an Application from Custer Telephone
Broadband Services,LLC ("CTBS"or "Company"),seeking approval of the equipment for the
broadband tax credit installed during the calendar year 2021.In the Application,CTBS states that
it installed broadband equipment associated with Cable Modem High-Speed Internet,Fixed
Wireless High-Speed Internet,and Fiber to the Home High-SpeedInternet Fiber Optic Fed Cable
Modem Service.CTBS discloses that its broadband network has data transmission rates of 512 Kb
per second to 1 Gbps to a subscriber and 128 Kb per second to 200 Mbps from a subscriber.These
rates exceed the minimum statutory speed requirements under Idaho Code §63-30291.The
Company represents that 1,904 of its Idaho customers have subscribed to its broadband network
within its designated service areas,and estimates 3,100 potential customers in Salmon,Idaho.
CTBS states that it invested $585,017.62 in 2021 in qualifyingbroadband equipment integral to its
broadband network.
STAFF REVIEW AND RECOMMENDATION
Staffreviewed and audited the list of proposed broadband equipment and believes the
identified equipment qualifies for the investment tax credit under Commission Procedural Order
No.35297 and Idaho Code §63-3029I(3)(b).Staff,therefore,recommends that the Commission
issue an order confirmingthe equipment is qualified broadband equipment and forward the
approving order along with a copy of the original Application to the Idaho State Tax
Commission.
COMMISSION DECISION
Does the Commission wish to issue an order confirmingthe equipment identified in Case
No.CTB-T-22-01 is qualified broadband equipment as defined in Idaho Code §63-3029I(3)(b)
and forward the order to the Idaho State Tax Commission?
ÌöfÏ E.alala-Kasanda
Udmemos/CTB-T-22-01 Decision Memo
DECISION MEMORANDUM -2 -JULY 26,2022