Wednesday, July 22, 2015

45G gains ground in Senate

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Sen. Orrin Hatch  (R-Utah) Sen. Orrin Hatch (R-Utah)

The Senate Finance Committee on July 21, 2015 met to debate S. 637, legislation put forward by Chairman Orrin Hatch (R-Utah) to extend expiring tax credits, including the Section 45G Short Line Tax Rehabilitation railroad track maintenance credit. 45G has been publically endorsed by 38 Senators who have cosponsored S. 637, a bill by Sens. Mike Crapo (R-Idaho) and Ron Wyden (D-Ore.) to extend the credit.

The House version of the bill, H.R. 721, currently has 222 co-sponsors, led by Reps. Lynn Jenkins (R-Kan) and Earl Blumenauer (D-Ore).

45G was also the subject of two significant actions leading up to the Senate Finance Committee debate. First, Wyden, the Ranking Democrat on the committee, joined by Crapo, Chuck Schumer (D-N.Y.), Pat Roberts (R-Kan.), Debbie Stabenow (D-Mich.), Johnny Isakson (R-Ga.), Maria Cantwell (D-Wash.), Ben Cardin (D-Md.), Sherrod Brown (D-Ohio) and Bob Casey (D-Pa.) successfully advocated for the inclusion of language to make investments to short line railroad track created between Jan. 1, 2005 and Jan. 1, 2015 eligible to earn 45G credits. This has been a goal of the American Short Line and Regional Railroad Association Legislative Policy Committee (LPC) since 2007. Chairman Hatch and Ranking Member Wyden included this language in S. 637 for the first time in the history of the effort, ASLRRA noted.

In addition, Sen. Crapo proposed an amendment to make the 45G credit permanent, “to ensure stable and long-term tax relief and infrastructure investment for small railroads,” ASLRRA said. “The permanency of a tax credit would enable small railroads to plan more effectively and efficiently for capital improvements.”

However, Crapo’s amendment, “like all other amendments dealing with the permanency of credits,” was ruled out of order for the debate.

“The 45G tax credit is absolutely critical to our industry, allowing for continuous investment in the upgrading and maintenance of track, which is a private-sector investment in America’s future economic success,” said ASLRRA President Linda Darr. “A safe, well-maintained rail infrastructure is the basis of a strong safety commitment. The 45G tax credit allows our members to invest their own capital at a pace that meets the needs of their customers, many of whom would otherwise be cut off from the national freight network, and allows short lines to be a competitive transportation solution. Ten new Senators have joined this effort in the past three weeks.”

“The employees of short line railroads, railroad customers, railroad contractors and suppliers have been reaching out to their elected officials for months and have built congressional support at a record pace in 2015,” said ASLRRA 45G Subcommittee Chairman Bob Ledoux of the Florida East Coast Railway. “Every Senator and Representative that steps up to support small railroads does so because they have heard directly and persuasively from their constituents. I thank Sen. Crapo and Sen. Wyden for answering this call. I also thank the 38 Senators and 222 Representatives that have joined this effort and the thousands of rail industry employees and customers that have reached out to their elected officials.”

“All of the short line railroads in Oregon are very appreciative of Senator Wyden’s and Senator Crapo’s efforts to enhance our ability to make the infrastructure investments necessary to safely and efficiently serve rail customers not only across Oregon, but the entire nation,” said Central Oregon & Pacific Railroad and Portland & Western Railroad Assistant Vice President Jerry Vest, who also serves as ASLRRA LPC Chairman. “This credit gives short line railroads the ability to reinvest more of their own funds back into their tracks and bridges, supporting the thousands of communities and customers across the nation dependent upon short line rail freight services.”

“ASLRRA Chairman and Watco Companies Chief Commercial Officer Ed McKechnie said, “Sen. Crapo today proposed an amendment to make the Section 45G credit permanent. This is the first time permanency of the short line credit has been discussed in the Finance Committee, and we thank Sen. Crapo for his continued efforts in this regard.”

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