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Idaho ag groups support shortline investment tax credit

A bill that would provide Idaho shortline railroads an income tax credit for investing in their infrastructure is being supported by the state’s farming community, which depends on these small railroads to move a wide variety of agricultural products.
Sean Ellis

Capital Press

Published on January 26, 2018 9:24AM

A bill that would provide Idaho shortline railroads an income tax credit for investing in their infrastructure is being supported by the state’s farming community, which depends on these small railroads to move a wide variety of agricultural products.

Sean Ellis/Capital Press

A bill that would provide Idaho shortline railroads an income tax credit for investing in their infrastructure is being supported by the state’s farming community, which depends on these small railroads to move a wide variety of agricultural products.


BOISE — Supporters of a bill that would incentivize shortline railroads in Idaho to invest in their infrastructure say it would also benefit the state’s agricultural industry.

There are nine of these smaller class III and class II railroads in Idaho and they transport a wide variety of agricultural and forest products, including sugar, potatoes, corn, barley, wheat and lumber, on their combined 885 miles of tracks.

These railroads, which move more than 190,000 carloads annually, also bring farm inputs such as fertilizer, feed and pulp board into the state.

House Bill 375 would offer shortline railroads a 50 percent income tax credit on investments they make on their infrastructure. The credit would be capped at $3,500 per mile of track.

Members of Food Producers of Idaho, which represents most of the state’s main farm groups, voted unanimously Jan. 24 to support the bill.

“Idaho Grain Producers (Association) supports investing in our infrastructure,” said Executive Director Stacey Katseanes Satterlee, who made the motion to support the bill.

“We move grain by truck, barge and rail and to get to the class one (railroads), you have to take the short lines,” she said. “Anything we can do to help incentivize them investing in their infrastructure is a good thing.”

Veritas Advisors partner John Watts, who represents shortline railroads and is guiding the bill through the Idaho Legislature, told Food Producer members last week that if these railroads use the income tax credit to improve their infrastructure, that would help the agricultural industry.

“This tax credit will allow us to invest in and maintain our infrastructure so we can move farm products more efficiently and less expensively,” he said. “This is really going to benefit you guys directly.”

A white paper explaining the legislation provided to FPI members says improved rail infrastructure “will allow heavier and fully loaded rail cars moving more product for less cost to a shipper....”

Roger Batt, who represents the state’s mint and seed industries, said farmers would benefit from any infrastructure upgrades shortline railroads make as a result of the tax credit, if lawmakers approve the bill.

“A lot of farmers in the state depend on shortline railroads for distributing their commodities,” he said. The tax credit “would benefit shortline railroads and that in turn would benefit the farmers who rely on that system.”

The legislation also allows the income tax credit to be transferred to one of the railroads’ customers.

That would allow them to “use the income tax credit to sustain their role in the Idaho product shipping chain, stimulate business growth, create jobs and help maintain the condition of the shipping infrastructure they utilize,” the white paper states.



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