20170516final_order_no_33764.pdf

Office of the Secretary
Service Date
May 16,2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF FILER MUTUAL )
TELEPHONE COMPANY’S 2016 BROADBAND )CASE NO.FIL-T-17-01
EQUIPMENT TAX CREDIT APPLICATION )
_______________________________)
ORDER NO.33764
On March 7,2017,Filer Mutual Telephone Company (“Filer”or “Company”)applied
to the Idaho Public Utilities Commission (“Commission”)for an Order confirming that
equipment it installed for calendar year 2016 is “qualified broadband equipment”under Idaho
Code §63-30291 (Income tax credit for investment in broadband equipment).With this Order,
we confirm that the installed equipment is “qualified broadband equipment”under Idaho Code §
63-30291.
THE APPLICATION
In its Application,Filer indicated that it invested about $1.1 million in qualifying
broadband equipment in 2016.See Application,Attached Worksheet.According to Filer,the
installed equipment is associated with asymmetric digital subscriber line (ADSL),high-bit-rate
digital subscriber line (HDSL),wireless broadband (WBB),and “fiber to the x”(FTTX)
(broadband network architecture using optical fiber to replace all or part of the local loop or
“last-mile”telecommunications network).Application at 2;see Staff Memorandum at 2.The
Company stated that the equipment is capable of transmitting signals at rates of 512 kilobits per
second (kbps)to 10 gigabits per second (gbps).Application at 2.The Company also stated that
99%of its customers can be served by the broadband network.Id.In a supplemental filing,the
Company indicated its equipment was “necessary for the provision of broadband service in Idaho
and [is]an integral part of [Filer’s]broadband network.”May 1,2017 Correspondence.
THE BROADBAND EQUIPMENT TAX CREDIT
Idaho Code §63-30291 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
the installed equipment is “qualified broadband equipment”as defined in the statute.Idaho
Code §63-30291(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
ORDER NO.33764 1
signals at a rate of at least”200,000 bits per second (bps)to a subscriber and at least 125,000 bits
per second (bps)from a subscriber.Idaho Code §63-30291(3)(b).In addition,to be qua1ified
broadband equipment”the equipment must be primarily used to provide services in Idaho to
Idaho public subscribers.”See Idaho Code §63-30291(3)(b)(vii).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-
30291(3)(b)(i).
In furtherance of its statutory responsibility,the Commission has issued Order No.
28784.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 Filer’s Application under Idaho Code §63-3029!.Based on its
review,Staff believes the Company’s listed equipment meets the statutory criteria and is
“qualified broadband equipment”that is eligible for the tax credit.Staff also believes the
Company’s identified expenditures “were for equipment that is ‘necessary for the provision of
broadband services and an integral part of a broadband network.”Staff Memorandum at 2.
Staff thus recommended the Commission:(1)issue an Order confirming that Filer’s equipment is
“qualified broadband equipment,”and (2)forward copies of the Application and Order to the
Idaho Tax Commission.
COMMISSION FINDINGS
Having reviewed Filer’s Application and Staffs recommendation,we find that the
Company’s equipment is “qualified broadband equipment”eligible for the tax credit under Idaho
Code §63-30291.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,based on what has been provided,we find it appropriate to issue an
Order confirming that Filer’s equipment is “qualified broadband equipment.”The Commission
makes no findings regarding the costs of the installed broadband equipment or other expenses.
ORDER NO.33764 2
ORDER
IT IS HEREBY ORDERED that Filer Mutual Telephone Company’s Application for
an Order confirming that equipment it installed in 2016 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 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 §6 1-626 and 62-6 19.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of May 2017.
ATTEST:
4;&’Z IIiL
Diane M.Hanian
Commission Secretary
():FIL-T-17-Oldjh
PRESIDENT
ERIC ANDERSON,COMMISSIONER
ORDER NO.33764 3