20050816_1284.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
CO MMISSI 0 NER SMITH
COMMISSIONER HANSEN
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:WAYNE HART
DATE:AUGUST 12, 2005
RE:TETON TELECOM BROADBAND TAX CREDIT APPLICATION;
CASE NO. COL-05-
BACKGROUND
On June 27 2005 , the Commission received an Application from Columbine Telephone
Company dba Teton Telecom (Teton) asking for approval of equipment for the broadband tax
credit pursuant to Order No. 28784 and Idaho Code ~ 63-30291(4). 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
Teton s Application indicated it had installed central office equipment and fiber cables to
provide DSL and T1 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
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 five hundred thousand dollars
of investment in 2004.
STAFF 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 12, 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 "be necessary
to the provision of broadband service and an integral part of a broadband network"Idaho Code
63-3029I(3)(b)(i). Staff has reviewed the list of proposed broadband equipment submitted by
Teton and believes that the equipment identified meets this statutory criteria. Therefore, Staff
recommends approval of the 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
Should the Commission approve Teton s Application for the broadband investment tax
credit?
u:dmemos/teton 05 bband dm
DECISION MEMORANDUM AUGUST 12, 2005