20170925Decision Memo.pdf

DECISION MEMORANDUM
TO:COMTVIISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:CAROLEE HALL
SEPTEMBER 2I,2OT7DATE:
RE:THE 2016 BROADBAND EQUIPMENT TAX CREDIT APPLICATION
FOR IDAHO 6-CLARK RSA LIMITED PARTNERSHIP, AN
OPERATING ENTTTY OF THB VERIZON WIRELESS BUSINESS
DIVISION; CASE NO. GNR-T-I7-09.
BACKGROUND
In 2001, House Bill377 was enacted authorizing income tax credit for the installation of
qualiffing broadband infrastructure in ldaho. ldaho Code $ 63-30298(3XaXii). In particular,
Section 63-30291allows 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 faeilities capable of
transmitting signals at a rate of at least 200,000 bits per seconds (bps) to a subssriber and at least
I25,000 bps from a subscriber." Idaho Code $ 63-3291(3Xb). If the equipment is installed by a
telecommunications carrier, it must also be "necessary to thc provision of broadband services
and an integral part of a broadband network." ldaho Code $ 63-30291(3XbXi). To be eligible
for the tax credit, the taxpayer must obtain from the Commission an Order confinning that the
installed equipment meets the statutory definition of qualified broadband equipment. Procedural
Order No. 28784 and ldoho 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 fonvarded to the Idaho Tax Commission.
DECISION MEMORANDUM SEPTEMBER 2I, 2OI7:
THE APPLICATION
On September 19, 201 7, the Commission received an Application from ldaho 5-Clark
RSA Limited Partnership, an operating entity of the Verizon Wireless business division
(collectively "Verizon" or "Compily"), seeking approval of the equipment for the broadband tax
credit installed during calendar year 2016. In the Application, Verizon states that it installed
equipment associated with "CDMA2000 (Code Division Multiple Access) technologies to
support LTE [Sonet Light Terminating Equipmentl for 4G [46 Generation Mobile SystemJ voice
and broadband data, in addition to three other generations of CDMA-based cellular network
technologies." Verizon discloses that its broadband network has data transmission rates between
300 Kbps and 3Mbps for subscriber downloads and uploads, which exceeds 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 100% of its Idaho subscribers have access to the broadband network.
During 2016, the Company invested approximately $3,903,086 in qualifying broadband
equipment that it confirms is integralto the broadband network
STAFF REVIEW AND RECOMMENDATION
Staffhas reviewed the list of proposed broadband equipment and believes the identified
equipment qualifies for the investment tax credit pursuant to Procedural Order No. 28784 and
Idaha Code $ 63-30291(3Xb). Staffi therefore, recomrnends 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 ldaho Tax Commission.
COMMISSION DECTSION
Does the Commission wish to issue an Order confirming the equipment identified in
Case No. GNR-T-17-09 is qualified broadband equipment as defined in ldaho Code $
63-30291(3Xb) and fonvard it to the ldaho Tax Commission?
Hall
UiDccision Mcmos/Broadband Tax Crcdits;GNR-T- I 7{9 20 I 6 ldaho
Busincss Div BB Tux Credit
DECISION MEMORANDUM -7 -
RSA Limitcd Putncnhip, Vcrizon Wirclcss
SEPTEMBER 2I,20I7