20241029Decision Memo.pdf

DECISION MEMORANDUM
TO: COMMISSIONER ANDERSON
COMMISSIONER HAMMOND
COMMISSIONER LODGE
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM: JOHAN E. KALALA-KASANDA
MICHAEL DUVAL,DEPUTY ATTORNEY GENERAL
DATE: OCTOBER 29, 2024
RE: IN THE MATTER OF CAMBRIDGE TELEPHONE CO., INC.'S
APPLICATION FOR APPROVAL OF THE IDAHO BROADBAND
EQUIPMENT TAX CREDIT FOR THE TAX YEAR 2021; CASE NO.
CAM-T-24-01.
BACKGROUND
In 2001, House Bill 377 was enacted authorizing income tax credit for the installation of
qualifying broadband infrastructure in Idaho. Idaho Code § 63-3029B(3)(a)(ii). Idaho Code §
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 equipment "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 §
63-3029I(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)(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. Commission Order No. 35297 and Idaho Code § 63-
3029I(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 State Tax Commission.
DECISION MEMORANDUM - 1 - OCTOBER 29, 2024

THE APPLICATION
On August 30, 2024, the Commission received an Application("Application"), from
Cambridge Telephone Co., Inc. ("CTC" or"Company"), seeking Commission determination that
the broadband equipment installed during the calendar year 2021 meets the statutory definition
of qualified broadband equipment and as ordered in Commission Order No. 35297.
In the Application, the Company represented that it is a telecommunications carrier that
provides broadband telecommunications services. The broadband services it offers to its
customers are associated with fiber to the home, digital subscriber line, and wireless services. It is
currently using Cisco,Optelian, and Brocade in its backbone network and Calix for its Digital Loop
Carrier.
The Company disclosed that its broadband equipment is capable of transmitting signals at
a rate ranging from 25 Megabits per second to 1 Gigabit per second symmetrical. These rates
exceed the minimum statutory speed requirements under Idaho Code § 63-3029I. The Company
confirmed that it added 30 new internet customers in 2021 bringing the total number of its
customers to 3,378 with at least one of the above-mentioned services. The availability of these
services to CTC's total customer base has remained at 79% in 2021.
Finally, the Company stated that it invested approximately $2,119,986.54 in 2021 in
qualifying broadband equipment that it confirms is integral to its broadband network. The three
percent broadband equipment tax credit for this capital investment amounts to $63,599.60.
STAFF REVIEW AND RECOMMENDATION
Staff examined the list of the proposed broadband equipment and believes the equipment
qualifies for the investment tax credit pursuant to Commission Order No. 35297 and Idaho Code
§ 63-30291(3)(b). Staff recommends that the Commission issue an order confirming the listed
equipment is qualified broadband equipment and forward that order along with a copy of the
Application to the Idaho State Tax Commission.
DECISION MEMORANDUM - 2 - OCTOBER 29, 2024

COMMISSION DECISION
Does the Commission wish to issue an order confirming the equipment identified in Case
No. CAM-T-24-01 is qualified broadband equipment as defined in Idaho Code § 63-3029I(3)(b)
and forward that order along with a copy of the Application to the Idaho State Tax Commission?
ohan E. Kalala-Kasanda
Commission Staff
L\Utility\UDMEMOSTAM-T-24-01 Decision Memo.docx
DECISION MEMORANDUM - 3 - OCTOBER 29, 2024