20040609Final Order No 29521.pdf

Office of the Secretary
Service Date
June 9, 2004
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
CUSTER TELEPHONE CO-OP, INC. FOR AN
INVESTMENT TAX CREDIT FOR
INSTALLING QUALIFIED BROADBAND
EQUIPMENT.ORDER NO. 29521
CASE NO. CUS-O4-
On May 11 , 2004, Custer Telephone Co-Op, Inc. filed an Application requesting that
the Commission find the Company eligible to receive an Idaho investment tax credit. Pursuant
to I4aho Code ~ 63-30291, an Idaho taxpayer may receive a tax credit for installing "qualified
broadband equipment" in Idaho. To be eligible for the tax credit, the taxpayer must obtain from
the Commission an Order confirming that the equipment has been installed and that it meets the
definition of qualified broadband equipment set out at Idaho Code ~ 63-30291(3)(b). Briefly,
qualified broadband equipment must be capable of transmitting signals at a rate of at least
200 000 bits per second (bps) to a subscriber and at least 125 000 bps from a subscriber. In the
case of a telecommunications service provider, the qualified broadband equipment must also "
necessary to the provision of broadband service and an integral part of a broadband network."
Idaho Code ~ 63-30291(3)(b )(i). In this Order, we find that Custer Telephone has installed
qualified broadband equipment.
THE APPLICATION
Custer Telephone states that during calendar year 2003, it installed varIOUS
components in its wireline broadband network for the provision of high-speed Internet access to
customers in its Idaho service area. Such components include fiber optic and copper cabling, a
Fujitsu-brand optical transport platform, digital line cards, cabinets, power supply, software and
backup batteries. Custer Telephone also included in its Application such items as supporting
engineering and overhead costs associated with its broadband projects. The Company maintains
that it began offering high-speed Internet service in 2001 at transmission rates between 128
kilobits per second (kbps) up to 1.5 megabits per second (Mbps). Custer Telephone states that its
broadband investment for 2003 was approximately $3.7 million.
ORDER NO. 29521
ST AFF REVIEW
To implement its responsibilities under Idaho Code ~ 63-30291, the Commission
issued Procedural Order No. 28784 in July 2001. This Order identifies information that must be
included in an Application for a broadband credit. Once the information has been filed, the
Commission Staff reviews the Application and submits a recommendation to the Commission.
Staff has reviewed the list of broadband equipment installed by Custer Telephone.
Staff believes that the equipment is "necessary for the provision of broadband services and is an
integral part of a broadband network." Consequently, Staff recommends that the Commission
issue an Order approving Custer Telephone s Application.
FIND IN GS
Having reviewed the Application and Staff s recommendation we find that the
Application for a qualifying broadband equipment Order should be granted. Custer Telephone
has demonstrated that it installed qualifYing broadband equipment identified in its Application
during 2003 in conformance with Idaho Code ~ 63-30291. We further find that as configured
the installed equipment is an integral part of a broadband network necessary to deliver broadband
services to Idaho customers. Idaho Code ~~ 63-30291(3)(b )(i, iv-vi). It is therefore appropriate
for the Commission to issue this Order confirming that Custer Telephone has installed qualified
broadband equipment as a precondition to seeking an Idaho broadband tax credit. The
Commission makes no findings regarding the costs of the installed broadband equipment or
whether it is appropriate to include engineering and overhead costs as part of its tax credit
request.
ORDER
IT IS HEREBY ORDERED that Custer Telephone s Application for an Order
certifying that it has installed qualifYing broadband equipment is granted.
IT IS FURTHER ORDERED that a copy of this Order and a copy of the Application
be served upon the Idaho State Tax Commission.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) or in interlocutory Orders previously issued in this Case No. CUS- T -04-
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 or in interlocutory Orders previously issued in
this Case No. CUS- T -04-Within seven (7) days after any person has petitioned for
ORDER NO. 29521
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 June 2004.
MARSHA H. SMITH, COMMISSIONER
, COMMISSIONER
ATTEST:
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Commission Secretary
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ORDER NO. 29521