Friday, February 21, 2014

Sen. Schumer continues to push for 45G tax credit

U.S. Senator Charles Schumer (D-NY) continued the effort to restore and extend the Short Line Railroad Rehabilitation and Investment Act through 2016.

While visiting the New York Susquehanna and Western Railway (NYSW), Sen. Schumer explained that the railroad is an important connector for New York businesses to ship their products to regional terminuses and beyond using locations such as the Port of New York for export, especially agricultural businesses transporting commodities like lumber, feed ingredients, motor vehicles and more.

The shortline tax credit expired on January 1 2014, but Schumer's bill would restore the credit and extend it through 2016. The tax credit is valued at 50 percent of the cost of track maintenance and improvements, up to $3,500 per mile.

Sen. Schumer explained that the tax credit, if extended through 2016, would fund capital improvement projects along the NYSW freight line. According to the railway, an extension of the 45G tax credit would allow it to undertake up to an additional $3 million in infrastructure improvements during the next two years.

Over the course of the life of the tax credit, NYSW has used roughly $7.5 million in tax credits to take on about $15 million dollars in track upgrades that would've been difficult to undertake without the presence of the tax credit. The tax credits were used to replace railroad ties, solidify the surface under the railroad and make other general maintenance improvements to the railroad.

According to the American Short Line and Regional Railroad Association, in the 110th, 111th, and 112th Congresses, legislation to extend 45G was co-sponsored by more than 250 representatives and 51 senators, with broad representation from both Democrats and Republicans. Currently in the 113th Congress, the House bill (H.R. 721) has 228 co-sponsors and was referred to the House Committee on Ways and Means on Feb. 14, 2014, while the Senate version (S.411) currently has 45 co-sponsors.

 

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