20190215Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONDR RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
F.ROM: DANIEL KLETN
DATE: FEBRUARY l4,20l9
RE:THE 2017 BROADBAND EQUIPMENT TAX CREDIT APPLTCATION
FOR LEADER COMMUNICATIONS, LLC; CASE NO. GNR-T-18-04.
BACKGROUND
In 2001, House Bill377 was enacted authorizing income tax uedit for the installation of
quali$ing broadband infrastructure in Idaho. Idaho Code $ 63-30298(3XaXii). In particular,
Section 63-3029I 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 ieast 200,000 bits per seconds (bps) to a subscriber and at least
125,000 bps from a subscriber;' Idaho Code $ 63-329I(3)(b). If the equipment is instailed by a
telecommunications carrier, it must also be "necessary to the provision of broadband services
and an integral part of a broadband network." Idaho Code $ $-3A29I(3)(bXi). To be eligible
for the tax credit, the taxpayer must obtain from the Commission an Order confirming that the
installed equipment meets the statutory definition of qualified broadband equiprnent. Procedural
Order No. 28784 and ldafui Code $ 63-3029I(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 fbrwarded to the Idaho Tax Commission.
-l-DECISION MEMORANDUM FEBRUARY I4,2OI9
THE APPLICATION
On March 19,2018, the Commission received an Application from Leader
Communications LLC ("Leader" or "Company"), seeking approval of the equiprnent for the
broadband tax credit installed during calendar year 2017. An Amendment to the Application
was filed on January 7,2A19. In the Application, Leader states that it installed equipment
associated with "delivering broadband internet to the residents and businesses of Benewah,
Latah, and Kootenai counties via wireless microwave and some with fiber optics." Leader
discloses that its broadband network has data transmission rates between 1 and 2Mbps for
subscriber downloads and uploads, which exceeds the required rates of 200,000 bits per second
to a subscriber and I25,000 bits per second from a subscriber. The Company asserts that 100%
of its Idaho subscribers have access to the broadband network. Leader invested approximately
$137,836.82 in2017 in qualiSing broadband equipment that it confirms is integral to the
broadband nctwork.
STAFtr' REVIEW AND RECOMMENDATION
Staff has reviewed and audited the list of proposed broadband equipment and believes the
identified equipment qualifies for the investment tax credit pursuant to Procedural Order
No. 28784 and ldaho Code $ 63-30291(3)(b). Staff, therefore, recommends that the Cornmission
issue an Order confirming the equipment is qualifled broadband equipment and forward the
approving Order along with a copy of the original Application to the Idaho l'ax Commission.
COMMISSION DECISION
Does the Comrnission wish to issue an Order confirming the equiprnent identified in
Case No. GNR-T-18-04 is qualified broadband equipment as defined in ldaho Code
S 63-3029I(3Xb) and forward it to the ldaho Tax Commission?
Daniel Klein
Udmcnros/CNR-T-18-04 2017 Leader Communications LLC Broadband lac Credit
DECISION MEMORANDUM -2-FEBRUARY 14,2019
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