20170901Decision Memo.pdf

RE:
DECTSION MEMORANDTIM
TO COMMTSSIONER KJELLAIYDER
COMMISSIONER RAPER
COMMIS SIOIYER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING T'ILE
FROM: CAROLEE HALL
DATE: AUGUST 30, 2017
CABLE ONE, TNC'S 2015 BROADBAND EQUIPMENT TAX CRf,DTT
APPLICATION; CASE NO. GNR-T-f 7-06.
BACKGROI.'NI}
In 2001, House Bill 377 was enacted authorizing income tor credit for the installation of
qualifying broadburd infrastructure in ldaho. Idaho Code $ 63-30298(3XaXii). In particular,
Section $-30291allows a tarpayer 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
transmitting signals at a rate of at least 200,000 bits per seconds (bps) to a subscriber and at least
125,000 bps from a subscriber;' Idaho Code $ 63-3291(3Xb). If the equipment is installed by
cable or open video system operator, the quali$ing equipment must "extend from the
subscriber's side of the headend to the outside of the structure I which the subscribcr is located."
ldoho Code $ 63-30291(3XbXiiD, To be eligible for the tax credit, the ta:rpayer 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 ta:< credit, an order along with the original Application is forwarded to the ldaho Tax
Commission.
THE APPLICATION
On August 28,2A17, Cable One, Inc. ('Cable One" or "Company') filed an Application
seeking Commission approval of equipment for the broadband tax credit for calendar year 2015.
IDECISION MEMORANDUM AUGUST 3O,2OI7
Cable One states in the Application that it had submitted tnro applications for 2015 in June and
August 2016. Staffsubsequently requested that the Cornpany combine the two reports and
resubmit them as one. The Company complied with Staffs request. In the Application, Cable
One states that it installed equipment associated with the Hybrid Coax Network ("HFC") using
fiber optic and coaxial sablc facililics. The Company asserts that its broadband network is
capable of transmission ratos of up to 200Mbps and that approximately 99.9% of its customers
have access to this service. During 2015, Cable One states that it invested approximately $8.2
million in qualifring broadband equipment in Twin Falls, Lewiston, Pocatello, Idaho Falls,
Boise, and West Valley arealr.
STAFF REVIEW AND RECOMMENDATION
Staffhas reviewed the Iist of proposed broadband equipment and believes the itemized
expenses, qualifies for the investment tax credit pursuant to Procedural Order No. 28784 and
Idaho Code $ 63-3029I(3Xb). Staffalso believes that the expendinres identified by the
Company, meets the requirements as defined for an open cable or open video system provider as
described in ldaho Code $ 63-30291(3xbxiii). Stafi, therefore, recommends that the
Commission issue an Order confirming the equipment is qualified broadband equipment and
fonrrard the approving Order along with a copy of the original Application to the ldaho Ta,x
Commission.
COMMISSION DECISION
Does the Commission wish lo issue an Order confirming the equipment identified in
Case No. GNR-T-!7-06 is qualifiod broadband equipment as delined in ldaho Code $
63-30291(3xbxiii) and fonuard it to the Idatro Tax Commission?
Hall
U/Decision Mcmos/Broadband Tax CrcditVGNR-T-!7-06 2015 Cable One. lnc Broadbond Tax Crcdit
DECISION MEMORANDUM -7-AUGUST 3O,2OI7