Southern MultiMedia Communications, Inc. - Page 17




                                       - 17 -                                         
         has rebuilt three of the systems only twice since the late                   
         1970's.                                                                      
              Wometco notes that since franchise agreements entered into              
         by cable television companies in the 1970's and 1980's rarely                
         included express rebuild requirements, few companies would                   
         receive any benefit under a narrow interpretation of the supply              
         or service transition rule.  We disagree.  Rebuilds and line                 
         extensions that were specifically under contract as of                       
         December 31, 1985, would be readily identifiable with and would              
         be treated as necessary to carry out specific contracts for such             
         improvements and would qualify for ITC under the supply or                   
         service transition rule.                                                     
              We conclude that Wometco is not entitled to ITC for the                 
         costs of the six rebuilds.  As of December 31, 1985, Wometco was             
         not under contract to install the six rebuilds, and the rebuilds             
         were not necessary to carry out Wometco's extant franchise                   
         agreements.  With regard to the line extensions, no evidence                 
         indicates that Wometco had specific binding commitments, as of               
         December 31, 1985, to install the line extensions.3                          
              Wometco is not entitled to the claimed ITC for the costs of             
         the rebuilds and the line extensions.                                        


          3     As indicated, we decide this case on the basis that the six           
          rebuilds and line extensions were not necessary to carry out                
          Wometco's franchise agreements.  We do not decide the issue of              
          whether the six rebuilds and line extensions were “readily                  
          identifiable with” Wometco's franchise agreements.                          




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  Next

Last modified: May 25, 2011