20200306Decision Memo.pdf

DECISION MEMORANDUM
TO COMMISSIONEIT KJIILLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSI ON SEC'RE,'TARY
LECAL
WORKING FILE
FROM: DANIEI- KLEIN
DATE: MARCH 5,202A
RII:THE 20r6 BROADIIAND FIQUITTMENT TAX CREDTT APPLICATTON
FOR RANDOM INVESTMENTS, LLC; CASE NO. GNR:I--20-01
BACKGITOUNI)
In 2001. House Bill 377 rvas enacted authorizing income tax credit for the installation of
qualily'ing broadband inliastructure in Idaho. Itluho Code $ 63-30298(3XaXii). In particular,
Section fi41291allou,s a taxpayer to receive an investmcnt 1ax credit Ibr etigible broadband
equipment installed during a calendar year.
Qualitied broadbarrd equiprnent is defined as "those netrvork lacilities capable of
transnritting signals at a rate of at least 200.000 bits pcr seconds (bps) to a subscriber and at least
125.000 bps liom a subscriber." ldcrho Code $ 63-3291(3Xb). If the equipment is installed b,v a
tclecommuriications carrier, it lnust also be "necessary to the provision ol'broadband sen,ices
and an integral part r:f a broadband nctwork." ldctho Cbrle g 63-30291(3)(bxi). To be eligible
Ibr the tax credit, the taxpayer must obtain fiorrr the Commission an Order confirming that the
installcd equipment meets the statutory delinition of qualified broadband equipment. Proccdural
Order No. 28784 and ldaho Code $ 63-30291(4). Once the Comrnission as deterrnined the
installed equiprnent is eligible fbr the broadband cquipment tax credit. an order along with the
original Application is forwardcd to the ldaho Tax Comrnission.
-1,DECISION MEMORANDUM MARCI{ 5,202A
THE APPLICATION
On January 28,2020, the Commission received an Application tlonr Random
Investments, LLC (collectively o'Random" or "Comp&try"), seeking approval of the equipment
for the broadband tax credit installed during calendar ycar 2016. In the Application, Random
states that it "is a real estate holding company. It has vertical assets (towers) that it leases to
related parties, Tekfinity, LLC and Tek-Hut. Inc., rvhich provide fixed and wireless broadband
internet to customers in Southem ldaho." The Company asserts that its related parlies service
approximately 2500 customers in ldaho. Random invested approximately $23,171 in 2016 in
qualiSing broadband equipment that it confirms is integral to the broadband network.
STATF REVItrW AND RECOMMENDATION
Staff has reviewed and audited the list olproposed broadband equipment and believes
the identified equipment qualifies for the investment tax credit pursuant to Procedural Order
No. 28784 and lduho Code $ 63-30291(3)(b). Staff, therefore, recommends that the Commission
issue an Order confirming the equipment is qualified broadband equipment and lorrvard the
approving Order along with a copy of the original Application to the Idaho Tax Commission.
COMMISSION DECISION
Does the Commission wish to issue an Order confirming the equipment identified in
Case No. GNR-T-20-02 is qualitied broadband equipment as detinedin ltlaho Code
$ 63-30291(3Xb) and forward it to the idaho'tax Comrnission?
.:1'
Daniel Klein
UdmemoVG N R -'I' -20 -02 20 I 6 Random Broad band "l"ar Crcd it
DECISION MEMORANDUM 1 MARCH 5,2020