20031003Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
LEGAL
COMMISSION STAFF
WORKING FILE
FROM:DOUG COOLEY
DATE:OCTOBER 3, 2003
RE:SYRINGA NETWORKS, LLC.S APPLICATION FOR BROADBAND
EQUIPMENT TAX CREDIT; CASE NO. GNR- T -03-28.
BACKGROUND
On August 19, 2003 , the Commission received an Application from Syringa Networks
LLC to receive an investment tax credit for eligible broadband equipment pursuant to Order No.
28784 and Idaho Code 9 63-30291(4). To be eligible for the tax credit, the taxpayer must apply
for and obtain from the Commission an Order confirming that installed equipment qualifies for
the tax credit.
DISCUSSION
Syringa stated that, during calendar year 2001 , it installed Signal Transfer Point and
supporting power for its packet switching. In 2002, Syringa indicates that it installed a digital
switch, digital access cross connects, SONET OC-48 multiplexers, an A TM switch, dense wave
division multiplexers, and approximately 100 miles of fiber optic cable. Syringa also included
supporting power supply materials as well as engineering and overhead costs.
Syringa s Applications states that it offers high-speed transport, frame relay, switching
and other related services to customers at transmission rates of 1.544 Megabits per second and
higher. One hundred percent of Syringa s customers are Idaho subscribers.
DECISION MEMORANDUM OCTOBER 3, 2003
STAFF REVIEW
Staff has reviewed the list of proposed broadband equipment submitted by Syringa and
believes the equipment identified qualifies for the investment tax credit pursuant to Idaho Code
9 63-30291. In its original Application, Syringa included land, leasehold improvements
furniture, office equipment, general purpose computers, and a company vehicle that Staff did not
believe qualified for the investment tax credit. After some discussions, Syringa agreed to
remove those items from its Application so that its investment totals $201 895 for 2001 and
$15 853 807 for 2002.
RECOMMENDATION
Staff recommends approval of the Company s Application as amended to these
investment totals and further recommends that the Commission forward the approving Order and
a copy of the original Application to the Idaho Tax Commission.
COMMISSION DECISION
Should the Commission approve Syringa Networks, LLC's Application for the
broadband investment tax credit?
i:udmemos/syringa
DECISION MEMORANDUM OCTOBER 3, 2003