20180810Decision Memo.pdf

DECISION MEMORANDUM
TO COMMISSIONER IilELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM: DANIEL KLEIN
DATE: AUGUST 9,2018
RE:CABLE ONE INC'S 2017 BROADBAND EQUIPMENT TAX CREDIT;
CASE NO. GNR-T.I8-05.
BACKGROUNI)
In 2001, House Bill377 was enacted authorizing income tax credit for the installation of
qualifuing broadband infrastructure in Idaho. Idaho Code $ 63-30298(3)(a)(ii). ln particular,
Section 63-3029I allows a ta:<payer 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
transrnitting signals at arate of at least 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 installed 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 $ 63-30291(3XbXi). To be eligible
forthe tax credit, thc taxpayer must obtain from the Comrnission 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 has determined the
installed equipment is eligible for the broadband equipment tax credit, an order along with the
originalApplication is forwarded to the Idaho Tax Commission.
DECISION MEMORANDUM -1-AUGI]ST 9,2018
THE APPLICATION
On July 12,2018, the Commission received an Application from Cable One [nc. ("Cable
One" or "Company"), seeking approval of the equipment for the broadband tax credit installed
during calendar year 20i7. In the Application, Cable One states that it installed broadband
equipment associated with the Hybrid Coax Network ("HFC"). Cable One discloses that is
broadband network has data transmission rates of 3 Mbps to 200Mbps. These rates exceed the
minimum statutory speed requirements pursuant to ldaho Code $ 63-30291. The Company
estimates that 99 .9o/o of its Idaho customers have access to its broadband network within its
designated service areas. Cable One invested approximately $12,396,603 in 2017 inqualifring
broadband equipment that it confirms is integral to the broadband network
STAFF REVIEW AND RECOMMENDATION
Staffhas 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 $ 63-3029I(3)O). Stafl therefore, recornmends that the Commission
issue an Order confirming the equipment is qualffied broadband equipment and forward 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 confirming the equipment identified in
Case No. GNR-T-18-05 is qualified broadband equipment as defined in ldaho Cade $
63-30291(3)(b) and forward it to the Idaho Tax Commission?
(4,,*,,'/.'
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Daniel Klein
i:udmemos/GNR-T-18-05 Cablc One Broadband Tax Credir
DECISION MEMORANDUM a AUGUST 9,2018
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