20060407Decision memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:WAYNE HART
DATE:APRIL 5, 2006
RE:IDACOMM, INc. BROADBAND TAX CREDIT APPLICATION;
CASE NO. IZ2-06-
BACKGROUND
On March 10, 2006, the Commission received an Application from IDACOMM, Inc.
(IDACOMM) asking for approval of equipment for the broadband tax credit pursuant to Order No.
28784 and Idaho Code ~ 63-30291 (4). To be eligible for the tax credit, the taxpayer must obtain
from the Commission an Order confirming that installed equipment qualifies for the tax credit.
STAFF ANALYSIS
IDACOMM's Application indicated it had installed (1) main office and remote terminal
equipment and (2) fiber and copper cables to provide broadband services to Idaho customers in the
Treasure and Magic Valleys. IDACOMM's Application indicated it provides broadband services
at speeds of 1 544 000 bits per second or higher. The Company indicated the equipment identified
in its Application is necessary and integral to its broadband network. The Company claims that
100% of the investment will be used to provide service to Idaho customers. The Application
identified approximately one and a half million dollars of investment in 2005.
DECISION MEMORANDUM APRlL 5 , 2006
STAFF REVIEW
In order to qualify for the credit, the broadband equipment must be capable of transmitting
signals at a rate of at least two hundred thousand (200 000) bits per second to a subscriber and at
least one hundred twenty-five thousand (125 000) bits per second from a subscriber. Idaho Code
~ 63-30291(3)(b). In addition, for a telecommunications carrier, such equipment must be
necessary to the provision of broadband service and an integral part of a broadband network"
Idaho Code ~ 63-30291(3)(b )(i).
ST AFF RECOMMENDATION
Staff has reviewed the list of proposed broadband equipment submitted by IDACOMM and
believes that the equipment identified meets this statutory criterion. Therefore, Staff recommends
approval of the Application and further recommends that the Commission forward the approving
Order along with a copy of the original Application to the Idaho Tax Commission.
COMMISSION DECISION
Does the Commission desire to approve IDACOMM's Application for an Order confirming
that installed equipment qualifies for the tax credit?
Wayne H
i :udmemos/idacomm _2006- broadband _memo
DECISION MEMORANDUM APRlL 5 , 2006