20130903_4159.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:GRACE SEAMAN
DATE:AUGUST 27,2013
RE:ONEWAVE NETWORKS BOISE,LLC AND ONE WAVE NETWORKS,
LLC’S BROADBAND EQUIPMENT TAX CREDIT APPLICATIONS;
CASE NOS.OWB-T-13-O1 AND OWN-T-13-01.
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).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 August 14,2013 the Commission received Applications from OneWave Networks
Boise,LLC (“OWB”)and One Wave Networks,LLC (“OWN”)(or collectively as
“Companies”)seeking approval of equipment for the broadband tax credit.In the Applications,
the Companies state that it installed equipment associated with Fixed Wireless Broadband
DECISION MEMORANDUM -1 -AUGUST 27,2013
services with transmission rates of I Mbps to 50 Mbps.OWB invested approximately S 126,600
in the Treasure Valley and surrounding areas and added approximately 250 customers during
2012.OWN invested approximately 5303.700 in the Magic Valley and surrounding areas and
added approximately 560 customers.
STAFF REVIEW AND RECOMMENDATION
Staff has reviewed the list of proposed broadband equipment submitted by both
Companies 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 the Company,an Internet Service Provider (offering it services
through fixed wireless and packet switching technologies)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
Nos.OWB-T-13-0I and OWN-T-13-0l is qualified broadband equipment as defined in Idaho
Code §63-30291(3)(b),and forward it to the Idaho Tax Commission?
Grace Seaman
Udmcmos/o”b-t-13-DI aid u’n-t-l3OI bic dcc memo
DECISION MEMORANDUM -2-AUGUST 27,2013