200175_dh.doc

DECISION MEMORANDUM

TO: COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
JEAN JEWELL
RON LAW
LOU ANN WESTERFIELD
GENE FADNESS
LYNN ANDERSON
RANDY LOBB
TONYA CLARK
JOE CUSICK
DOUG COOLEY
BEVERLY BARKER
WORKING FILE

FROM: DON HOWELL

DATE: JULY 5, 2001

RE: THE COMMISSION’S BROADBAND PROCEDURAL ORDER,
CASE NO. GNR-T-01-10

House Bill 377 authorized income tax credits for the installation of qualifying broadband infrastructure in Idaho. Idaho Code § 63-3029B(3)(a)(ii). “Qualified broadband equipment” is defined as those 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 bps from a subscriber. Idaho Code § 63-3029I(3)(b). To be eligible for the tax credit, a taxpayer must apply and obtain “from the Idaho public utilities commission an order confirming that installed equipment is qualified broadband equipment.” Idaho Code § 63-3029I(4). This section also provides that the Commission “may issue procedural orders necessary to implement this section.” Id.
On June 14, 2001, the Commission issued the attached Proposed Order to implement its responsibilities under the broadband tax credit statute. IDAPA 31.01.01.312. The Proposed Order identified information that should be contained in an application to determine whether the installed equipment is “qualified” broadband equipment.

THE PROPOSED ORDER
As contained on page 2 of the Proposed Order, the Commission invited comments regarding specific information that should be contained in a broadband application. In particular, the Commission specified that applications should address nine items of information. Persons interested in commenting on the Proposed Order were invited to submit written comments no later than July 5, 2001. The Commission received two comments.
THE COMMENTS
Verizon Northwest and Qwest Corporation each filed brief comments. In its comments, Verizon “applaud[ed] the Commission’s efforts to implement House Bill 377 and believes that this should help to speed deployment of broadband infrastructure in Idaho.” Verizon recommended that information filed in response to paragraph Nos. 7 and 8 be considered as confidential information. Items 7 and 8 provide:
7. Provide a written description (including basic schematics or general drawings) of the relevant broadband network including a description of how the installed equipment is “an integral part” of a broadband network.

8. Quantify the percentage and number of potential Idaho subscribers that could be served with the broadband equipment and the percentage and number of non-Idaho subscribers that will be/could be served by the broadband network.

Proposed Order at 2.
In its comments, Qwest agreed that “the information described in the Proposed Order is appropriate for determination of whether equipment is qualified broadband equipment.” Qwest Comments at 1. In particular, Qwest agreed with Item No. 2 in the Proposed Order which requires an application to state the transmission rate of the broadband network. The Company stated that its understanding of the phrase “qualified broadband equipment” includes
items that are necessary and integral for the broadband network to operate, but which are not part of the actual transmission of the signal. Thus, Qwest agrees that an application should set out the transmission rate for the network, and that the transmission rate does not apply to specific items of equipment.

Qwest Comments at 2 (emphasis added).

COMMISSION DECISION
1. Does the Commission wish issue the Proposed Order as its final Order?
2. Does the Commission desire to address the comments?
3. Does the Commission wish to make any changes to the Proposed Order?

Donald L. Howell, II

bls/M:gnrt0110_dh3

DECISION MEMORANDUM 1