20180615Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMI\fl SSIOI\TER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM: DANIEL KLEIN
DATE: JIINE 13,2018
BLACKFOOT COMMT]NICATIONS, INC. DBA I'REMONT
coMMrrNrcATIoN's 2017 BROADBAIYD EQIIIPMENT TAX CREDIT;
CASE NO. F'RC.T.l8.OT
BACKGROT'ND
ln 2001, House Bill377 was enacted authorizing income tax credit for the installation of
qualiffing broadband infrastructure in Idaho. Idaho Code $ 63-30298(3XaXi0. In particular,
Section 63-3029I 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
hansmitting signals at arate of at least 200,000 bits per seconds (bps) to a subscriber and at least
125,000 bps from a subscriber;' Idaho Code $ 63-329(3)0). 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 $ 63-30291(3XbXi). To be eligible
for the ta:< 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. 28784 and ldaho Code $ 63-30291(4). Once the Commission as determined the
installed equipment is eligible for the broadband equipment tax credit, an order along with the
original Application is forwarded to the Idaho Tax Commission.
IDECISION MEMORANDUM JUNE 13,2018
RE:
THE APPLICATION
On April 24,2018, the Commission received an Application from Blackfoot
Communications, lnc. dba Fremont Communications ("Blackfoot" or "Company"), seeking
approval of the equipment for the broadband tax credit installed duing calendar year 2017. ln
the Application, Blackfoot states that it installed equipment associated with Asymmetric Digital
Subscriber Line (ADSL) and Ethemet broadband services (using 18k nonJoaded copper
distribution, fiber optic backbone and distribution cable). Blackfoot discloses that its broadband
network has data hansmission rates of 256Kbps to I Mbps from a subscriber and 768 Kbps to I
Mbps to a subscriber which meets the required rates of 200,000 bits per second to a subscriber
and 125,000 bits per second from a subscriber. The Company asserts that 680/o of its ldaho
customers have broadband services. Blackfoot invested approximately $728,958 in 2017 in
qualiffing broadband equipment that it confirms is integral to the broadband network
STAFF REVIEW AND RECOMMENDATION
Staffhas reviewed and audited the list of proposed broadband equipment and believes the
identified equipment qualifies for the investment tax credit pursuant to hocedural Order No.
28784 ard Idaho Code $ 63-3029I(3Xb). Stafi therefore, recommends that the Commission
issue an Order confirming the equipment is qualified broadband equipment and forward the
approving Order along with a copy of the original Application to the Idaho Tax Commission.
COMMISSION DECISION
Does the Commission wish to issue an Order confirming the equipment identified in
Case No. FRC-T-18-01 is qualified broadband equipment as defined in ldaho Code $
63-30291(3Xb) and forward it to the Idaho Tax Commission?
Daniel Klein
Udmemos/FRC-T- I 8-01 Blackfoot Broedband Tari Credit
DECISION MEMORANDUM -2-Jt NE 13,2018
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