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RAIL EMPLOYMENT & NOTICES



Rail News Home Rail Industry Trends

2/25/2011



Rail News: Rail Industry Trends

House bill would extend short-line tax credit another six years


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On Feb. 15, Rep. Lynn Jenkins (R-Kan.) introduced the Short Line Railroad Rehabilitation and Investment Act of 2011 (H.R. 721), which would extend the Section 45G short-line tax credit through Dec. 31, 2017.

Co-sponsored by Reps. Earl Blumenauer (D-Ore.), Jim Costa (D-Calif.), Jerry Costello (D-Ill.) and Bill Shuster (R-Pa.), the bill also would allow tax credit eligibility for new short lines formed after Jan. 1, 2005, and before Jan. 1, 2011. H.R. 721 has been referred to the House Committee on Ways and Means.

In December, the passage of the Middle Class Tax Relief Act of 2010 extended the short-line tax credit through 2011. Originally enacted in January 2005, the Section 45G provision enables regionals and short lines to claim a tax credit of 50 cents for every dollar spent on infrastructure improvements, up to a cap of $3,500 per mile of owned or leased track.

The tax credit helps fund more than $300 million worth of short-line infrastructure improvements annually, according to American Short Line and Regional Railroad Association (ASLRRA) estimates.

“Section 45G creates a strong incentive for short line railroads to invest private sector dollars on freight railroad track rehabilitation and improvements,” said ASLRRA officials on a web page that summarizes H.R. 721.


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