20210504dk1jo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:DANIEL KLEIN
DATE:APRIL 29,2021
RE:CUSTER TELEPHONE BROADBAND SERVICES,LLC'S 2020
BROADBAND EQUIPMENTTAX CREDIT;CASE NO.CTB-T-21-02.
BACKGROUND
In 2001,House Bill 377 was enacted authorizing income tax credit for the installation of
qualifyingbroadband 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 §63-329I(3)(b).If the equipmentis 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 §63-3029I(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 §63-3029I(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.
DECISION MEMORANDUM -1 -APRIL 29,2021
THE APPLICATION
On April 16,2021,the Commission received an Application from Custer Telephone
Broadband Services,LLC ("CTBS"or "Company"),seeking approval of the equipment for the
broadband tax credit installed during calendar year 2020.In the Application,CTBS states that it
installed broadband equipment associated with Cable Modem High Speed Internet,Fixed
Wireless High Speed Internet,and Fiber to the Home High Speed Internet Fiber Optic Fed Cable
Modem Service.CTBS discloses that its broadband network has data transmission rates of
512,000 to l Gbps to a subscriber and 128,000 to 200 Mbps from a subscriber.These rates
exceed the minimum statutory speed requirements pursuant to Idaho Code 63-30291.The
Company estimates that more than 57%of its Idaho customers have subscribed to its broadband
network within its designated service areas.CTBS invested approximately $848,558.55 in 2020
in qualifyingbroadband equipment that it confirms is integral to the broadband network.
STAFF REVIEW AND RECOMMENDATION
Staff has reviewed and audited the list of proposed broadband equipment 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,therefore,recommends that the Commission
issue an Order confirmingthe 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 confirmingthe equipment identified in Case
No.CTB-T-21-02 is qualified broadband equipment as defined in Idaho Code §63-3029I(3)(b)
and forward it to the Idaho Tax Commission?
Daniel Klein
Udmemos/CTB-T-2l-02 2020 CTBS Broadband Tax Credit
DECISION MEMORANDUM -2 -APRIL 29,2021