20250624Decision Memo.pdf

DECISION MEMORANDUM
TO: COMMISSIONER LODGE
COMMISSIONER HAMMOND
COMMISSIONER HARDIE
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM: JOHAN E. KALALA-KASANDA, COMMISSION STAFF
JEFFREY R. LOLL,DEPUTY ATTORNEY GENERAL
DATE: JUNE 249 2025
RE: IN THE MATTER OF CUSTER TELEPHONE COOPERATIVE INC.'s
APPLICATION FOR THE 2024 BROADBAND EQUIPMENT TAX
CREDIT; CASE NO. CUS-T-25-01.
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- 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 equipment "capable of transmitting
signals at a rate of at least two hundred thousand (200,000) bits per seconds 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). 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 Idaho Public Utilities Commission ("Commission") an order
confirming that the installed equipment meets the statutory definition of qualified broadband
equipment. Commission Order No. 35297 and Idaho Code § 63-30291(4). Once the
Commission has determined that 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.
DECISION MEMORANDUM - 1 - JUNE 24, 2025

THE APPLICATION
On April 2, 2025, Custer Telephone Cooperative, Inc. ("Company") applied to the
Commission seeking approval of the equipment for the broadband tax credit installed during
the calendar year 2024.
In the Application, the Company stated that it provides basic local exchange service,
broadband telecommunications service,and other telecommunications services in Idaho. Application
at 1. The services offered to its customers include Asymmetric Digital Subscriber Lines' ("ADSL"),
Very High-Speed Digital Subscriber Lines ("VDSL"), Fiber to The Home, and wireless services
technologies. The Company described its network as fiber optic-fed DLCs with 12K non-loaded
copper distribution cable, a fiber optic backbone,transport electronics, fiber to the home distribution
and electronics, and VoLTE wireless data 3. Application at Exhibit A.
The Company disclosed that it provides broadband services to its customers at the
following transmission rates: (i)the lowest subscribed rate is 512 Kilobits per second("Kbps")
to a subscriber and 128 Kbps from a subscriber; (ii) the lowest advertised rate is 50 megabits
per second symmetrical; and (iii) the highest advertised rate is 1 gigabit per second
symmetrical. Id. The Company confirmed that during 2024, it served 1,659 customers out of
2,198 potential customers, representing 75%. Id.
The Company reported investing $911,532.80 in qualifying broadband equipment in
2024, resulting in a 3% broadband tax credit of$27,345.98. Id. The Company attests that all
items listed in Exhibit A are necessary for providing broadband services and are integral to
the operation of the broadband network. Id.
STAFF REVIEW AND RECOMMENDATION
Staff reviewed the list of proposed broadband equipment and believes the identified
equipment qualifies for the investment tax credit pursuant to Commission Order No. 35297
1 ADSL is a type of Digital Subscriber Line("DSL")technology,a data communications technology that enables faster
data transmission over copper telephone lines than a conventional voiceband modem can provide.ADSL differs from
the less common Symmetric Digital Subscriber Line("SDSL").In ADSL,bandwidth and bit rate are said to be
asymmetric,meaning greater toward the customer premises(downstream)than the reverse(upstream).
z A VDSL is a DSL technologies that provides data transmission faster than the earlier standards of asymmetric digital
subscriber line.
s Voice over LTE,or VoLTE,is a digital packet technology that uses 4G LTE networks to route voice traffic and
transmit data. This voice service is the standard for high-speed wireless communications in devices such as
smartphones,data terminals,IoT devices and wearables.
DECISION MEMORANDUM - 2 - JUNE 24, 2025

and Idaho Code § 63-3029I(3)(b). Staff recommends that the Commission issue an order
confirming that the equipment 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 confirming the broadband
equipment identified in Case No. CUS-T-25-01 is qualified broadband equipment as
defined in Idaho Code § 63-30291(3)(b), and forward the order and Application to the
Idaho Tax Commission?
Anything else?
Man E. Kalala-Kasanda
Commission Staff
I:\Uti1ity\UDMEM0S\CUS-T-25-01 Decision Memo.docx
DECISION MEMORANDUM - 3 - JUNE 24, 2025