20210416Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER R4PER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:DANIEL KLEIN
DATE:APRIL 13,2021
RE:THE 2020 BROADBAND EQUIPMENT TAX CREDIT APPLICATION
FOR TEK-HUT,INC;CASE NO.GNR-T-2I-04.
BACKGROUND
In 2001,House Bill 377 was enacted authorizing income tax credit for the installation of
qualiing broadband infrastructure in Idaho.Idaho Code §63-3029B(3)(a)(ii).In 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 subscriber.”Idaho Code §63-3291(3)(b).If the equipment is installed by a
telecommunications carrier,it must also be “necessary’to the provision of broadband sen’ices
and an integral pan of a broadband network.”Idaho Code §63-30291(3)(b)(i).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 equipment.Procedural
Order No.28784 and Idaho 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
original Application is forwarded to the Idaho Tax Commission.
DECISION MEMORANDUM -1 -APRIL 13,2021
THE APPLICATION
On March 26,2021,the Commission received an Application from Tek-Hut,Inc.
(collectively “Tek-Hut”or “Company”),seeking approval of the equipment for the broadband
tax credit installed during calendar year 2020.In the Application,Tek-Hut states that it mffers
fixed wireless and wired broadband internet service...primarily in Southern Idaho.”Tek-Hut
discloses that its broadband network has data transmission rates between I Mbps to 50 Mbps 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 its
related parties service approximately 2500 customers in Idaho.Tek-Hut invested approximately
$20,169.44 in 2020 in qualifying broadband equipment that it confirms is integral to the
broadband network.
STAFF 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 Idaho Code §63-30291(3)(b).Staff,therefore,recommends that the Commission
issue an Order conflrming the equipment is qualified broadband equipment and forward 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-21-04 is qualified broadband equipment as defined in Idaho Code §63-30291(3)(b)
and forward it to the Idaho Tax Commission?
Daniel KLein
Udmemos/GNR-T-21-04 2020 Tek-Elut Broadband Ta Credit
DECISION MEMORANDUM -2-APRIL 13,2021