Members of the rail industry have asked Congress to extend tax credit.
Small and regional railroads are working again to get a tax credit renewed that is designed to help small businesses shore up aging railroad infrastructure.
The short line railroad tax credit expired at the end of 2014. In the past 10 years it has pumped in more than $1.5 billion to short lines for track maintenance and replacement, Linda Bauer Darr, the new president of the American Short Line and Regional Railroad Association said Thursday at a freight conference in Chicago.
Reps. Earl Blumenauer, D-Ore., Dan Lapinski, D-Ill., and Lynn Jenkins, R-Kan., submitted the Short Line Railroad Rehabilitation and Investment Act of 2015 earlier this year to extend the short line tax credit through 2016. There are 156 co-sponsors in the House and 18 for a companion bill in the Senate.
Section 45G provides a tax credit of 50 cents for every dollar spent on track improvements. The credit is capped based on a mileage-based formula.
Last year, the credit was extended retroactively.
Short lines play an important role in the freight system by connecting mainline railroads with factories, power plants, refineries, ports, grain elevators and other shipping facilities.
“We’d love it [an extension] to be longer term because we really need to have that level of predictability in order to make investments in the larger projects,” Darr commented after her presentation at the Rail Supply Chain Summit.
Short line railroads seek tax incentive for track rehab
