20170126final_order_no_33703.pdf

Office of the Secretary
Service Date
January 26, 2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF CITIZENS TELECOMMUNICATIONS ) CASE NO. CTC-T-16-01
COMPANY OF IDAHO DBA FRONTIER )
COMMUNICATONS OF IDAHO FOR A 2015 )
INVESTMENT TAX CREDIT FOR ) ORDER NO. 33703
INSTALLING QUALIFYING BROADBAND )
EQUIPMENT )
On December 27, 2016, Citizens Telecommunications Company of Idaho dba
Frontier Communications of Idaho (the "Company") applied to the Idaho Public Utilities
Commission ("Commission") for an Order confirming that equipment it installed in 2015 is
"qualified broadband equipment" under Idaho Code § 63-3029! (Income tax credit for
investment in broadband equipment). With this Order, we confirm that the installed equipment
is "qualified broadband equipment" under Idaho Code § 63-3029I.
THE APPLICATION
In its Application, the Company states that in 2015 its net investment in qualifying
broadband equipment was $880,579.78. See Application at 6. The Company states that it
installed equipment associated with Asymmetric Digital Subscriber Line (ADSL) in the
following Idaho communities: Aberdeen, Cascade, Donnelly, Elk City, Fairfield, Garden Valley,
Homedale, Horseshoe Bend, McCall, New Meadows, Parma, Riggins, Sweet, Whitebird and
Wilder. Id. at 1. The Company states that transmission rates ranged between 640 kilobits per
second (Kbps) and 6 megabits per second (Mbps) to or from a customer.' Id. at 2. The
Company also states that its broadband network is now available to approximately 14,692 Idaho
customers, or 87% of its total Idaho customer base. Id. Finally, the Company certifies that the
equipment it lists in its Application "is an integral part of a network that permits broadband
signaling to occur." Id.
THE BROADBAND EQUIPMENT TAX CREDIT
Idaho Code § 63-3029I allows a taxpayer to receive an income tax credit for having
installed qualified broadband equipment during a calendar year. Before the taxpayer is eligible
for the tax credit, the taxpayer must first apply to the Commission for an Order confirming that
1 Where one Mbps equals 1,000 Kbps and one Kbps equals 1,000 bits per second (bps).
ORDER NO. 33703
the installed equipment is "qualified broadband equipment" as defined by statute. Idaho Code §
63-3029!( 4). That statute defines "qualified broadband equipment" as equipment that qualifies
for the Idaho Code § 63-3029B capital investment credit that "is capable of transmitting signals
at a rate of at least [200,000 bps] to a subscriber and at least [125,000 bps] from a subscriber."
Idaho Code § 63-3029I(3)(b). Further, in "the case of a telecommunications carrier, such
qualifying equipment shall be necessary to the provision of broadband service and an integral
part of a broadband network." Idaho Code § 63-3029I(3)(b )(i).
In furtherance of its statutory responsibility, the Commission has issued Order No.
28784.2 That Order specifies the information the taxpayer must include in the broadband tax
credit application. When the taxpayer files the application, the Commission Staff reviews it to
determine whether the listed equipment meets the statutory definition of "qualified broadband
equipment." Staff then submits a recommendation to the Commission. If the Commission
ultimately approves the application, then the Commission forwards it and the Order to the Idaho
State Tax Commission.
STAFF REVIEW
Staff reviewed the Company's Application under Idaho Code § 63-3029!. Based on
its review, Staff believes that the Company is a telecommunications carrier and that the listed
equipment meets the statutory criteria and is "qualified broadband equipment" that is eligible for
the tax credit. Staff thus recommended the Commission: (1) issue an Order confirming that the
Company's equipment is "qualified broadband equipment," and (2) forward copies of the
Application and Order to the Idaho State Tax Commission.
COMMISSION FINDINGS
Having reviewed the Company's Application and Staffs recommendation, we find
that the Company's equipment is "qualified broadband equipment" eligible for the tax credit
under Idaho Code § 63-3029!. The Company is a telecommunications carrier. Further, the listed
equipment (as presently configured) is an integral part of the Company's broadband network and
is necessary to the provision of broadband service to Idaho customers. Accordingly, it is
appropriate for the Commission to issue an Order confirming that the Company's equipment is
2 The Commission issued Order No. 28784 pursuant to Idaho Code § 63-3029I(4), which empowers the
Commission to "issue procedural orders necessary to implement" Idaho Code§ 63-3029(4).
ORDER NO. 33703 2
"qualified broadband equipment." The Commission makes no findings regarding the costs of the
installed broadband equipment or other expenses.
ORDER
IT IS HEREBY ORDERED that the Company's Application for an Order confirming
that equipment it installed in 2015 is "qualified broadband equipment" is granted.
IT IS FURTHER ORDERED that a copy of this Order and a copy of the Application
be served on the Idaho State Tax Commission.
THIS IS A FINAL ORDER. Any person interested in this order (or in issues finally
decided by this order) may petition for reconsideration within twenty-one (21) days of the
service date of this order with regard to any matter decided in this order. Within seven (7) days
after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § § 61-626 and 62-619.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of January 2017.
ATTEST:
Diane M. Hanian
Commission Secretary
0:CTC-T-16-0l_sc
ORDER NO. 33703
ERIC ANDERSON, COMMISSIONER
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