20050517_1197.pdf

DECISION MEMORANDUM
TO:CO MMISSI 0 NER KJELLAND ER
CO MMISSI 0 NER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:WAYNE HART
DATE:MAY 12, 2005
RE:DIRECT COMMUNICATIONS CABLE BROADBAND TAX CREDIT
APPLICATION; CASE NO. GNR-05-
BACKGROUND
On April 11 , 2005 , the Commission received an Application from Direct Communications
Cable (Direct Cable) asking for approval of equipment for the broadband tax credit pursuant to
Order No. 28784 and Idaho Code ~ 63-30291(4). To be eligible for the tax credit, the taxpayer
must obtain from the Commission an Order confirming that installed equipment qualifies for the
tax credit.
STAFF ANALYSIS
Direct Cable s Application indicated it had installed (1) fiber and coaxial cables and (2)
remote digital terminals and related equipment to provide cable modem broadband services to
Idaho customers. Direct Cable s Application indicated its service provides speeds of 512 000 bits
per second for uploads from customers, and 1 000 000 bits per second for downloads to customers.
The Company claims that 100% of the investment will be used to provide service to Idaho
customers. The Application identified over one hundred fifty thousand dollars of investment in
2004.
ST AFF REVIEW
In order to qualify for the credit, the broadband equipment must be 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.
DECISION MEMORANDUM MAY 12, 2005
Idaho Code ~ 63-3029I(3)(b). In addition, for a cable or open video system operator, such
equipment must "extend from the subscriber s side of the headend to the outside of the structure in
which the subscriber is located"Idaho Code ~ 63-3029I(3)(b )(iii).
STAFF RECOMMENDATION
Staff has reviewed the list of proposed broadband equipment submitted by Direct Cable
and believes that the equipment identified meets this statutory criterion. Therefore, Staff
recommends approval of the Application and further recommends that the Commission forward
the approving Order along with a copy of the original Application to the Idaho Tax Commission.
COMMISSION DECISION
Should the Commission approve Direct Cable s Application for the broadband ipvestment
tax credit?
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u:dmemos/direct cable 2005 broadband DM
DECISION MEMORANDUM MAY 12 2005