BILL WOULD ALTER RAIL TAXES

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, February 25, 1993                   TAG: 9302250166
SECTION: VIRGINIA                    PAGE: B8   EDITION: NEW RIVER VALLEY 
SOURCE: From staff and wire reports
DATELINE: RICHMOND                                LENGTH: Medium
BILL WOULD ALTER RAIL TAXES
A bill crafted by House Majority Leader Richard Cranwell and awaiting Gov. Douglas Wilder's signature has come under criticism by local-government officials who fear it could cut taxes paid by railroads.
But not all railroads operating in Virginia would pay lower taxes under the measure. Norfolk Southern Corp. expects the bill's provisions will increase the taxes it pays on its track.
The legislation faced little resistance from lawmakers, even though its financial impact was uncertain. Railroad officials called it a compromise that will end years of litigation over the methods used to assess rail property.
"Under the formula our taxes would go up in about every jurisdiction in which we have track," said Hank Wolf, NS vice president for taxation. "It doesn't affect land, it doesn't affect buildings, it doesn't affect any other structure."
The bill calls for an assessment formula based on property values reported by railroads to the Interstate Commerce Commission and to the Internal Revenue Service. The old formula based assessments on factors such as how much it cost to build the lines, minus a certain amount for depreciation.
Local officials say the legislation would reduce revenue to localities, but they could not say by how much. To figure that out, they would have to know the value that the railroads ascribe to their lines for tax purposes - numbers found only on confidential federal tax returns.
Robert W. Shinn, a vice president with Richmond-based CSX Corp., said tax records will be made available if Wilder signs the bill.
In many cases, he said, the new formula will increase the amount of taxes being paid to localities because the measure prohibits the assessed value of company property from dropping below its 1992 rate for four years.
Local officials contend the bill is an effort to get around a recent court ruling upholding the assessment method.
Keywords:
GENERAL ASSEMBLY 1993

by Archana Subramaniam by CNB