20030811_585.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
CO MMISSI 0 NER SMITH
COMMISSIONER HANSEN
JEAN JEWELL
WORKING FILE
FROM:DOUG COOLEY
DATE:AUGUST 6, 2003
RE:CABLE ONE'S APPLICATION FOR BROADBAND EQUIPMENT TAX
CREDIT; CASE NO. GNR- T -03-25.
BACKGROUND
On July 9, 2003 , the Commission received an Application from Cable One, Inc., to
receive an investment tax credit for eligible broadband equipment pursuant to Order No. 28784
and Idaho Code ~ 63-30291(4). To be eligible for the tax credit, the taxpayer must apply for and
obtain from the Commission an Order confirming that installed equipment qualifies for the tax
credit.
DISCUSSION
Cable One stated that, during calendar year 2002, it installed coaxial cable and fiber
optics as part of its "Hybrid Fiber Coax Network" (HFC) in and around the areas of Boise, Idaho
Falls, Lewiston, Twin Falls, and Pocatello. According to its Application, Cable One s network
offers high-speed data services using fiber optic receivers and transmitters, Motorola RF network
amplifiers, signal equalizers, and couplers and taps. In addition to the electronics, fiber optic
cable, and coaxial cable, Cable One also included in its Application its labor costs and the
supporting hardware such as connectors, conduit, splicing equipment, and enclosure materials.
The amount of the requested tax credit for 2002 is just over $472 000.
Cable One states that it offers high-speed Internet and broadband services to homes and
businesses in Idaho at upstream and downstream transmission rates of 128 kbps to 1.5 Mbps.
Cable One s network in Idaho consists of approximately 2,447 miles of aerial coax, 1 877 miles
DECISION MEMORANDUM AUGUST 6, 2003
of underground coax and 524 miles of fiber optic cable and passes by over 290 000 Idaho homes
and businesses.
STAFF REVIEW
Staffhas reviewed the list of proposed broadband equipment submitted by Cable One and
believes that the equipment identified qualifies for the investment tax credit pursuant to Idaho
Code ~ 63-30291. Cable One also specified that the listed equipment complies with Idaho Code
~ 63-30291 (3)(b)(iii) which requires that qualifying equipment extends "from the subscribers
side of the headend to the outside of the subscriber structure." Therefore, Staff recommends
approval ofthe Company s 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 Cable One s Application for the broadband investment
tax credit?
. )
DOU
i:udmemos/cable one 2
DECISION MEMORANDUM AUGUST 6, 2003