20181005Decision Memo.pdf

RE:
DECISION MEMORANDT]M
TO:COMMIS SIONER KJELLAIYDER
COMMISSIOIYBR RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM: DANIEL IOEIN
DATE: OCTOBER 3,2018
THE 2017 BROADBAND EQUIPMENT TAX CREDIT APPLICATION
FOR INLAND CELLULAR, LLC; CASE NO. INC-T-18-03.
BACKGROT}ND
In 2001, House Bill377 was enacted authorizing income tax credit for the installation of
qualifling broadband infrastructure in ldaho. 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
transrnitting 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 $ 63-329I(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 $ 63-3029I(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 equipment. Procedural
Order No. 28784 and ldaha 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 forwarded to the Idaho Tax Commission.
-t-DECISION MEMORANDUM OCTOBER 3,20I8
THE APPLICATION
On August 73,2018, the Commission received an Application from Inland Cellular,
LLC. ("Inland" or o'Compffiy"), seeking approval of the equipment for the broadband tax credit
installed during calendar yeat20L7. In the Application, lnland states that it inslalled equipment
associated with technologies to support LTE fSonet Light Terminating EquipmentJ for 4G [46
Generation Mobile System] voice and broadband data, in addition to cellular network
technologies. Inland discloses that its broadband network has data transmission rates between l0
Mbps and 3 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 that87%o of its Idaho subscribers have access to the broadband network. Inland
invested approximately $345,146.47 in20l7 in quali$ing broadband equipment that it confirms
is integral to the broadband network
STAF'F' 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 5 63-3029I(3)(b). Staff; therefore, recommends that the Commission
issue an Order confirming the equiprnent 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 con{irming the equipment identified in
Case No. INC-T-I8-03 is qualified broadband equipment as defined in ldaho Code
$ 63-3029I(3)(b) and forward it to the Idaho Tax Commission?
1i.i ,/l/ ...\, c_v
Daniel Klein
UdmemosiINC-T-I8-03 2017 lnland Sroadband Tax Credit dec memo
DECISION MEMORANDUM -2-OCTOBER 3,2018
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