20051019final order no 29897.pdf

Office of the Secretary
Service Date
October 19 2005
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
RURAL TELEPHONE COMPANY, INC. FOR
AN INVESTIMENT TAX CREDIT FOR
INSTALLING QUALIFIED BROADBAND
EQUIPMENT ORDER NO. 29897
CASE NO. RUR-O5-
On October 4, 2005 , Rural Telephone Company, Inc. ("Rural Telephone" or
Company ) filed an Application requesting that the Commission find the Company eligible to
receive an Idaho Investment Tax Credit. Pursuant to Idaho Code ~ 63-30291, an Idaho taxpayer
may receive a tax credit for installing "qualified broadband equipment" in Idaho. To be eligible
for the tax credit, the taxpayer must obtain from the Commission an Order confirming that the
installed equipment meets the definition of qualified broadband equipment set out at Idaho Code
~ 63-3029I(3)(b). Briefly, qualified broadband equipment must be capable of transmitting
signals at a rate of at least 200 000 bits per second (bps) to a subscriber and at least 125 000 bps
from a subscriber. In the case of a telecommunications carrier, the qualified broadband
equipment must also "be necessary to the provision of broadband service and an integral part of a
broadband network." Idaho Code ~ 63-3029I(3)(b)(i). In this Order we find that Rural
Telephone has installed qualified broadband equipment.
THE APPLICATION
Rural Telephone s Application indicates that during 2002, 2003 , and 2004 it installed
central office equipment, remote terminal equipment and fiber optic cables to provide
Asymmetric Digital Subscriber Line (ADSL) and ADSL2+ broadband services to Idaho
customers. The Company states that transmission rates are from 1 megabits per second (Mbps)
to 8.0 Mbps. The Application included a signed affidavit indicating the submitted investments
qualify for the broadband tax credit. The Company capitalized the labor and overhead costs
associated with the installation of this equipment, and indicates nearly $2 460 600 of broadband
investment for 2002, nearly $606,400 for 2003, and nearly $1 048,400 for 2004.
ST AFF REVIEW
To implement its responsibilities under Idaho Code ~ 63-30291, the Commission
issued Procedural Order No. 28784 in July 2001. This Order identifies information that must be
ORDER NO. 29897
included in an Application for a broadband tax credit. Once the information has been filed, then
the Commission Staff reviews the Application and submits a recommendation to the
Commission. Staff reviewed the list of broadband equipment submitted by Rural Telephone.
Staff believes that the equipment is "necessary for the provision of broadband services and an
integral part of a broadband network." Idaho Code ~ 63-3029I(3)(b)(i). Consequently, Staff
recommended that the Commission issue an Order approving Rural Telephone s Application.
Staff further recommended that the Commission forward the approving Order, along with a copy
of the original Application, to the Idaho Tax Commission.
FINDINGS
Having reviewed Rural Telephone s Application and Staffs recommendation, we
find that the Application for a qualifying broadband equipment Order should be granted. The
Company has demonstrated that the installed broadband equipment identified in its Application
conforms with the qualifying requirements of Idaho Code ~ 63-3029I(b). We further find that
as configured, the installed equipment is an integral part of a broadband network necessary to
deliver broadband services to Idaho customers. Idaho Code ~ 63-3029I(3)(b)(i). It is therefore
appropriate for the Commission to issue this Order confirming that Rural Telephone has installed
qualified broadband equipment as a precondition to seeking an Idaho broadband tax credit. The
Commission makes no findings regarding the costs of the installed broadband equipment.
ORDER
IT IS HEREBY ORDERED that Rural Telephone Company, Inc.s Application for
an Order certifying that it has installed qualifying broadband equipment is approved.
IT IS FURTHER ORDERED that a copy of this Order and a copy of the Application
be served upon the Idaho State Tax Commission.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) may petition for reconsideration within twenty-one (21) days of the
service date of this Order. Within seven (7) days after any person has petitioned for
reconsideration, any other person may cross-petition for reconsideration. See Idaho Code ~ 61-
626.
ORDER NO. 29897
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this Itf/*
day of October 2005.
tl
MARSHA H. SMITH, COMMISSIONER
ENNIS S. HANSEN, COMMISSIONER
ATTEST:
O:RUR-05-
ORDER NO. 29897