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HomeMy WebLinkAbout20100920_3079.pdfDECISION MEMORANDUM TO:COMMISSIONER KEMPTON CO MMISSI 0 NER SMITH COMMISSIONER REDFORD COMMISSION SECRETARY LEGAL WORKING FILE FROM:GRACE SEAMAN DATE:SEPTEMBER 16,2010 CENTURYTEL OF IDAHO, INC. 2009 BROADBAND EQUIPMENT TAX CREDIT APPLICATION; CASE NO. CEN-I0-03. RE: 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 ~ 63-30291(3)(b). Ifthe 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 ~ 63-30291(3)(b)(i). To be eligible for the tax credit, the taxpayer must obtain from the Commission an Order confirming that the installed equipment meets the statutory definition of qualified broadband equipment. Procedural Order No. 28784 and Idaho Code ~ 63-30291(4). Once the Commission has determined 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 On September 2 2010 the Commission received an Application from CenturyTel ofldaho Inc. (CenturyTel) seeking approval of equipment for the broadband tax credit. In the Application CenturyTel states that it installed equipment associated with Asymmetrical Digital Subscriber Line DECISION MEMORANDUM - 1 - (ADSL) services with transmission rates of 1 Mbps to a subscriber and 125 Kbps from a subscriber in the Salmon exchange. CenturyTel asserts that 68% of its customers in Salmon are served or can be served by the broadband network. The Application states that CenturyTel invested approximately $176 800 in qualifying broadband equipment during the last six months of2009 (July 1 through December 31 , 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 ~ 63-30291(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 that the Commission issue an Order confirming the equipment is qualified broadband equipment and forward the approving Order along with a copy of the original Application to the Idaho Tax Commission. COMMISSION DECISION Does the Commission wish to issue an Order confirming the equipment identified in Case No. CEN-I0-03 is qualified broadband equipment as defined in Idaho Code ~ 63-30291(3)(b)(i), and forward it to the Idaho Tax Commission? !h C41' L~LA~ Grace Seaman i: udmemos/eentel-l 0-03 bte.doe DECISION MEMORANDUM - 2 -