20250722Decision Memo.pdf

DECISION MEMORANDUM
TO: COMMISSIONER LODGE
COMMISSIONER HAMMOND
COMMISSIONER HARDIE
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM: JON KRUCK, COMMISSION STAFF
ERIKA K. MELANSON,DEPUTY ATTORNEY GENERAL
DATE: JULY 22, 2025
RE: IN THE MATTER OF FARMERS MUTUAL TELECOM, INC's
APPLICATION FOR THE 2024 BROADBAND EQUIPMENT TAX
CREDIT; CASE NO. FMU-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 second [("bps")] to a
subscriber and at least one hundred twenty-five thousand (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 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 - JULY 22, 2025

THE APPLICATION
On July 8, 2025, Farmers Mutual Telecom, Inc. ("Company") applied to the
Commission seeking approval of the equipment for the broadband tax credit installed
during the calendar year 2024. Application at 1. On July 14, 2025, the company filed an
amended application ("Amended Application") with additional required information. On
July 18, 2025 the Company filed a second amended application ("Second Amended
Application") updating the calendar year the Company represented the equipment was
invested in under Idaho Code § 63-3029(I)(3)(b).
In the Amended Application, the Company stated that it provides broadband service
directly to customers in Idaho.Amended Application at 6. The Company stated that the services
are offered through Fiber and Terrestrial Fixed Wireless. Id.
The Company disclosed that the lowest offering it provides broadband services to
its customers is at transmission rates of 12,000,000 bps to subscribers and 1,500,000 bps
from subscribers (12Mbps/1.5Mbps). Amended Application at Exhibit A. These rates
exceed the minimum statutory speed requirements as set forth in Idaho Code § 63-3029(I).
The Company confirmed that during 2024, it served 287 broadband customers, resulting
in 8.81% out of 3,255 broadband serviceable locations in the Company's service area, all
within the State of Idaho. Id.
The Company reported investing $263,368.26 in qualifying broadband equipment
in 2024, which resulted in a 3% broadband tax credit of$7,900.96. 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 and Idaho Code § 63-3029(I)(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.
DECISION MEMORANDUM - 2 - JULY 22, 2025

COMMISSION DECISION
Does the Commission wish to issue an order confirming the broadband equipment
identified in Case No. FMU-T-25-01 is qualified broadband equipment as defined in Idaho
Code § 63-3029(I)(3)(b), and forward the order and Application to the Idaho Tax
Commission?
Anything else?
on Kruck
Commission Staff
I:\Uti1ity\UDMEM0S\FMU-T-25-01 Decision Memo.docx
DECISION MEMORANDUM - 3 - JULY 22, 2025