20170901Decision Memo.pdf

RE:
DECISION MEMORANDTJM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:CAROLEE HALL
AUGUST 30,2017DATE:
BACKGROUND
In 2001, House Bill 377 was enasted authorizing income tax credit for the installation of
quali$ing broadband infrastructure in ldaho. Idaho Code i 63-30298(3XaXii). [n particular,
Section 63-30291 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
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 subscribcr;' Idaho Code $ 63-329(3Xb). If the equipment is installed by
cable or open video system operator, the quali$ing equipment must "extend from &e
subscriber's side of the headend to the outside of the structure I which the subscriber is losated."
Idaho Code $ 63-3029(3xbxiii). To be eligible for the tax credit, the taxpayer must obtain from
thc Commission an Order confirming that the installed equipment meets the statutory definition
of qualified broadband equipment. Procedural OrderNo. 28784 utd ldaho Code $ 63-3029(4).
Once the Commission as determined the installed equipment is eligible for the bnradband
equipment tal( uedit, an order along with the original Application is forwarded to the ldaho Ta,t
Commission.
THE APPLICATION
On August 28,2017, Cable One, Inc. ("Cable Ons" or "Company") filed an Application
seeking Comrnission approval of equipment for the broadband tax crcdit for calendar year 2016.
DECISION MEMORANDUM I AUGUST 30,2OI7
CABLE ONE,INC'S 2016 BROADBAND EQUIPMENT TAX CREDIT
APPLICATION; CASE NO. CNR-T-r?-07.
Cable One states in the Application that it installed equipment associated with the Hybrid Coax
Network ("HFC") using fiber optic and coaxial cable facilities. The Company asserts that its
broadband network is capable of transmission rates of up to 200Mbps and that approximately
99.9o/o of its customers have access to this service. During 2016, Cable One states that it
invested approximately $8.4 million in qualifring broadband equipment in Twin Falls, Lewiston,
Pocatello, Idaho Falls, Boise, and West Valley areas.
STAFF REVIEW AND RECOMMENDATION
Staffhas reviewed the list of proposed broadband equipment and believes the itemized
expenses, qualifies for the investrnent tax credit pursuant to Procedural OrderNo. 28784 and
Idaho Code $ 63-30291(3)(b). Statralso believes that the expenditures identified by the
Company, me€ts the rcquirements 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 fonuard the
approving Order along with a copy of the original Application to the ldaho Tax Commission.
COMMISSION DECISION
Does the Commission wish to issue an Order conlirming the equipment identified in
Case No. GNR-T-17-07 is qualified broadband equipment as defined in ldaho Code $
63-3029(3xbxiii) and fonrard it to the Idaho Tax Commission?
Hall
UiDecision Mcmos/Broadband Tax Credits/GNR-T-17-07 2016 Cablc One, lnc. Brosdbsnd Tax Credit
DECISION MEMORANDUM AUGUST 30,2OI7