20150203Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:GRACE SEAMAN
DATE:JANUARY 29,2015
RE:SYRINGA NETWORKS,LLC’S 2013 BROADBAND EQUIPMENT TAX
CREDIT APPLICATION;CASE NO.SZ9-T-15-01.
BACKGROUND
In 2001,House Bill 377 was enacted authorizing income tax credit for the installation of
qualifying broadband infrastructure in Idaho.Idaho Code §63-30293(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 §63-30291(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 §63-30291(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.
THE APPLICATION
On January 21,2015,the Commission received an Application from Syringa Networks,
LIC (“Syringa”or “Company”)seeking approval of equipment for the broadband tax credit for
calendar year 2014.Syringa states it is a provider of wholesale broadband telecommunications
DECISION MEMORANDUM -I -JANUARY 29,2015
service and other telecommunications services in southern Idaho.In the Application,Syringa lists
investments associated with fiber optic facilities,equipment,and engineering connected with the
broadband network.Syringa states that its broadband telecommunications network in southern
Idaho can provide services with maximum transmission speeds of 10 Gigabits per second.Syringa
reports investments of approximately $3,261,100 in qualifying broadband equipment for calendar
year 2014.
STAFF REVIEW AND RECOMMENDATION
Staff has reviewed the list of proposed broadband equipment submitted by Syringa 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 further believes that the expenditures
identified by Syringa,a telecommunications provider,were for equipment that is “necessary for
the provision of broadband services and an integral part of a broadband network.”Staff,therefore,
recommends that the Commission issue an Order confirming the equipment is qualified broadband
equipment and forward the approving Order along with the 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.SZ9-T-15-Ol is qualified broadband equipment as defined in Idaho Code §63-30291(3)(b)(i),
and forward it to the Idaho Tax Commission?
/—
Grace Seaman
iudmcmos/sz9.t-1 5-01 btc dcc mcrno
DECISION MEMORANDUM -2-JANUARY 29,2015