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HomeMy WebLinkAbout20090921_2708.pdfDECISION MEMORANDUM TO:COMMISSIONER KEMPTON COMMISSIONER SMITH COMMISSIONER REDFORD COMMISSION SECRETARY LEGAL WORKING FILE FROM:GRACE SEAMAN DATE:SEPTEMBER 17, 2009 RE:CENTURYTEL OF IDAHO'S BROADBAND EQUIPMENT TAX CREDIT APPLICATION FOR FIRST HALF OF 2009; CASE NO. CEN- T -09- 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). In particular Section 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 those network facilities capable of transmitting signals at a rate of at least 200 000 bits per seconds (bps) to a subscriber and at least 125 000 bps from a subscriber. Idaho Code ~ 63-3029I(3)(b). To be eligible for the broadband equipment tax credit, the taxpayer must obtain from the Commission an Order confirming that installed equipment qualifies for capital investment credit. Procedural Order No. 28784 and Idaho Code ~ 63-30291(4). THE APPLI CA TI 0 On September 11 2009, the Commission received an Application from CenturyTel of Idaho, Inc. (CenturyTel) seeking approval of equipment for the broadband tax credit. The Application identifies the broadband investments made by CenturyTel for the six months ending on June 30, 2009. CenturyTel states it installed equipment that provides Asymmetric Digital Subscriber Line (ADSL) service with transmission rates of 1 Mbps to a subscriber and 128 Kbps from a subscriber. The qualifying equipment was installed in the Salmon exchange. CenturyTel asserts that 3,420 or 68% of its Idaho customers have access to broadband services. The DECISION MEMORANDUM - 1 -SEPTEMBER 17, 2009 Company identifies approximately $31 200 in qualifying broadband equipment for the first six months of 2009. ST AFF REVIEW AND RECOMMENDATION Staff has reviewed the list of proposed broadband equipment submitted by CenturyTel and believes the identified equipment qualifies for the investment tax credit pursuant to Procedural Order No. 28784 and Idaho Code ~ 63-3029I(3)(b). Staff also believes that the expenditures identified by CenturyTel, a telecommunications provider, were for equipment that is "necessary for the provision of broadband services and an integral part of a broadband network." Staff, therefore, recommends acceptance ofthe 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 Does the Commission wish to accept the Application for the broadband investment tax credit? d: ~U L~~ race Seaman i:udmemos/centO9-02.doc DECISION MEMORANDUM - 2 -SEPTEMBER 17, 2009