20050822_1307.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:WAYNE HART
DATE:AUGUST 18, 2005
RE:SILVER STAR TELEPHONE CO. BROADBAND TAX CREDIT
APPLICATION; CASE NO. SIL-05-
BACKGROUND
On June 27, 2005, the Commission received an Application from Silver Star Telephone Co.
Inc. (Silver Star) asking for approval of equipment for the broadband tax credit pursuant to Order
No. 28784 and Idaho Code ~ 63-30291(4). A revised application was submitted on August 17
2005. 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
Silver Star s Application indicated it had installed central office equipment and fiber optic
cables to provide DSL and Tl services to Idaho customers. The Company asserts that its service
provides speeds of between 128K and 1.5M bits per second for uploads from customers, and 256K
and 1.5M bits per second for downloads to customers. The Company further states that the
equipment is necessary and integral to its broadband network and that 100% of the investment will
be used to provide service to Idaho customers. The Application identified over one hundred
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
DECISION MEMORANDUM AUGUST 18, 2005
least one hundred twenty-five thousand (125 000) bits per second from a subscriber. Idaho Code
~ 63-3029I(3)(b). In addition, for a telecommunications carrier, such equipment must "
necessary to the provision of broadband service and an integral part of a broadband network"
Idaho Code ~ 63-3029I(3)(b)(i). Staffhas reviewed the list of proposed broadband equipment
submitted by Teton 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 Application to the Idaho Tax
Commission.
COMMISSION DECISION
Should the Commission approve Silver Star s Application for the broadband investment tax
credit?
u:dmemos/silver star 2005 broadband dm
DECISION MEMORANDUM AUGUST 18, 2005