20260106Staff Comments.pdf

RECEIVED
January 06, 2026
JEFFREY R. LOLL IDAHO PUBLIC
DEPUTY ATTORNEY GENERAL UTILITIES COMMISSION
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83702
[phone]
IDAHO BAR NO. 11675
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF FREMONT TELECOM )
CO.'S APPLICATION FOR THE 2024 ) CASE NO. FRE-T-25-01
BROADBAND EQUIPMENT TAX CREDIT )
COMMENTS OF THE
COMMISSION STAFF
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission
("Commission"), by and through its attorney of record, Jeffrey R. Loll, Deputy Attorney
General, submits the following comments.
BACKGROUND
On July 23, 2025, Fremont Telecom Co. ("Company") applied to the Commission for an
order confirming that equipment the Company installed during 2024 is "qualified broadband
equipment"under Idaho Code § 63-3029I (Income tax credit for investment in broadband
equipment) ("Application").
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 §
STAFF COMMENTS 1 JANUARY 6, 2026

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). The equipment must be primarily used to provide services to
subscribers in Idaho to qualify for the credit. Idaho Code § 63-3029I(3)(b)(vii).
To be eligible for the tax credit, the taxpayer must obtain an order from the Commission
confirming that the installed equipment meets the statutory definition of qualified broadband
equipment. Commission Order No. 35297 and Idaho Code § 63-3029I(4). Prior to making such
a determination, the Commission requires applicants to submit"a specific list of the equipment
or types of equipment that the applicant is requesting that the Commission determine is
`qualified broadband equipment' as defined in Idaho Code § 63-3029I(3)(b)," and to "[l]ist the
brand, manufacturer, model numbers of the installed equipment, number of items, and total
cost." Order No. 35297, Attachment A. 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.
THE APPLICATION
According to the Company, it offers broadband services through Asymmetric Digital
Subscriber Line (ADSL), Very-high-bit-rate Digital Subscriber Line (VDSL), Broadband
Ethernet and Wavelength services. Application at 2.
The Company stated that it provides broadband services to its customers at
transmission rates of 256,000 bits per second up to 1,000,000,000 bits per second from a
subscriber and 768,000 bits per second up to 1,000,000,000 bits per second to a
subscriber. Id. The Company confirmed that during 2024, it served 4,271 broadband
customers in Idaho out of 13,551 possible broadband subscribers, resulting in 32%of
possible subscribers being served. Id.
The Company reported investing $2,818,233.75 in qualifying broadband
equipment in 2024. Id. at 1.
STAFF ANALYSIS
Staff reviewed the documentation submitted with the Application and audited the list
of broadband equipment submitted by the Company. During the review, Staff was unable
STAFF COMMENTS 2 JANUARY 6, 2026

to verify that all of the broadband equipment listed complied with the requirements of
Commission Order No. 35297, which requires the brand, manufacturer, and model number
of the listed broadband equipment. On October 20, 2025, Staff requested the missing
information through production requests. In the Company's October 31, 2025, response to
Staff s Production Request#1, the Company provided an identical list to the one that was
originally submitted.
Staff remains unable to verify several line items in the list as qualifying
broadband equipment pursuant to Commission Order No. 35297 and Idaho Code § 63-
3029I(3)(b). For instance, many of the line items were listed as costs for "internal
labor" and "overhead costs." Application at 4. For these entries, the Company simply
stated "N/A" for multiple required categories of information, such as the brand and
model number. In other entries, the Company provided a general industry description
despite listing multiple manufacturers. Id. Staff created two Attachments from the
information that was submitted through Staff s Production Request. Attachment A lists
the broadband equipment that includes all the required information from Commission
Order No. 35297. Attachment B lists the broadband equipment that is missing or cannot
be verified as broadband equipment.
Staff believes a reasonable reading of Idaho Code §§ 63-3029B, 63-3029I and
the requirements of Order No. 35297 would not justify a recommendation that such
costs are qualifying broadband equipment. Staff consulted with Tax Research Specialist
with the Idaho State Tax Commission, Philip Johnson, regarding their understanding
that costs qualifying for the broadband tax credit are limited to direct investments in
physical equipment and do not extend to additional project expenses. The Company can
file a new Application for any of the items in Attachment B once the Company had
compiled the required information.
The Company reported investing $2,818,233.75 in qualifying broadband
equipment. Application at 2. Based on its review of the list, Staff believes $2,662,807.18
of the Company's claimed investment should be disqualified, as the Company did not
provide all of the information required by Order No. 3529, Attachment A, for
equipment corresponding with that amount. Such a reduction would result in a
STAFF COMMENTS 3 JANUARY 6, 2026

qualifying broadband equipment investment total of$155,426.56 for 2024. The 3%
broadband tax credit of this total would be $4,662.80.
STAFF RECOMMENDATION
Staff recommends the Commission issue an order confirming the broadband
equipment listed in Attachment A is qualified broadband equipment and forward the
approving order along with a copy of the original application to the Idaho Tax
Commission.
Respectfully submitted this 6th day of January 2026.
Jeffrey R. Loll
Deputy Attorney General
Technical Staff. Allison Moore
Jon Kruck
STAFF COMMENTS 4 JANUARY 6, 2026

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 6ch DAY OF JANUARY 2026,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. FRE-T-25-01, BY E-MAILING A COPY THEREOF, TO THE FOLLOWING:
STACEY MUELLER, CPA
CHIEF FINANCIAL OFFICER
BLACKFOOT COMMUNICATIONS, INC.
1221 NORTH RUSSELL STREET
MISSOULA, MT 59808
E-MAIL: tax&blackfoot.com
Gt%��il�l G� 97o�i
PATRICIA JORD. , SECRETARY
CERTIFICATE OF SERVICE