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: DUNE 249 2025
RE: IN THE MATTER OF CUSTER TELEPHONE BROADBAND
SERVICES LLC's APPLICATION FOR THE 2024 BROADBAND
EQUIPMENT TAX CREDIT; CASE NO. CTB-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 § 63-3029I(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 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 02, 2025, Custer Telephone Broadband Services LLC ("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 represented that it is a provider of basic local exchange
services, broadband telecommunications services, and other telecommunications services in Idaho.
Application at 1. The broadband services it offers to its customers are associated with a cable
modem' high-speed internet, fixed wireless, and Fiber-to-the-Home2 technologies. The Company
described its network as a fiber optic-fed cable system that provides cable modem service, fiber
optic transport electronics, fiber optic backbone, distribution cable, and a fixed wireless network.
Application at Exhibit A.
The Company confirmed that it offers broadband services to its customers at the
following transmission rates: (i) the lowest subscribed rate is 1.5 Megabits per second
("Mbps") to a subscriber and 512 Kilobits per second from a subscriber; (ii) The lowest
advertised rate is 50 Mbps to a subscriber and 50 Mbps from a subscriber; and(iii)The highest
advertised rate is 1 gigabit symmetrical. These rates exceed the minimum statutory speed
requirements under Idaho Code § 63-3029I. The Company confirmed that during 2024, it
provided broadband services to 2,011 customers out of an estimated 4,117 potential customers
in Salmon, Idaho, representing 48%. Id.
The Company reported that it invested $5,978,746 in 2024 in qualifying broadband
equipment, which equates to a 3% broadband tax credit totaling $179,362. The Company
asserted that all the purchased equipment listed is necessary for the provisioning of broadband
service and is an integral part of its broadband network. Id.
1 A cable modem is a type of network bridge that provides bi-directional data communication via radio frequency
channels on a hybrid fiber coaxial(HFC),radio frequency over glass(RFoG)and coaxial cable infrastructure. Cable
modems are primarily used to deliver broadband Internet access in the form of cable Internet,taking advantage of the
high bandwidth of a HFC and RFoG network.
2 FTTH,also called fiber to the premises,is the installation and use of optical fiber from a central point to individual
buildings to provide high-speed internet access. FTTH dramatically increases connection speeds available to computer
users compared to other technologies.
DECISION MEMORANDUM - 2 - JUNE 24, 2025

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
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. CTB-T-25-01 is qualified broadband equipment as
defined in Idaho Code § 63-3029I(3)(b), and forward the order and Application to the
Idaho Tax Commission?
Anything else?
hjKan E. Kalala-Kasanda
Commission Staff
I:\Uti1ity\UDMEM0S\CTB-T-25-01 Decision Memo.docx
DECISION MEMORANDUM - 3 - JUNE 24, 2025