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CONRAIL CHALLENGES NEW YORK STATE TAXES

 /Following is a repeat for points as needed./
 PHILADELPHIA, Sept. 20 /PRNewswire/ -- Conrail (NYSE: CRR) today


filed suit challenging its property taxes in the State of New York because the railroad's property is assessed and taxed at higher levels than other commercial and industrial property, in violation of the federal Railroad Revitalization and Regulatory Reform Act of 1976 (4R Act).
 New York's assessment of Conrail's rail transportation property represents nearly a 70 percent increase in Conrail's assessments in a single year, resulting in total taxes in violation of the 4R Act of nearly $12 million for 1993. Under the 4R Act, Conrail has asked the U.S. District Court for the Southern District of New York to allow Conrail to pay only its undisputed taxes of about $20 million when due, and deposit the disputed amounts into escrow pending the resolution of its claim.
 Conrail's lawsuit names the New York State Board of Equalization and Assessment and individual assessing, levying and collecting jurisdictions in New York as defendants.
 The 4R Act's Section 306 requires that the ratio of the assessed value of rail transportation property to its true market value must not exceed the same ratio for all other commercial and industrial property in the same jurisdiction. On a statewide basis, Conrail's ratio in New York State is 129 percent, compared to 48 percent for all other commercial and industry property owners.
 The federal prohibition against discriminatory taxation of railroads evolved after more than 15 years of investigation in the 1960s and 1970s by congressional committees and study groups.
 They found that state and local tax authorities discriminated against railroads because they cannot easily relocate their facilities like other companies.
 Congress also enacted the statute because discriminatory property tax burdens imposed by one state are "exported" to others in the form of higher shipping costs. The excessive taxes also hinder interstate commerce by diverting funds from reinvestment and maintenance.
 The Congressional committees also found that state administrative and judicial procedures to end the discrimination were inefficient and ineffective; in some jurisdictions, like New York, multiple state court actions are needed to obtain relief.
 In addition to the State Equalization Board, Conrail asked that the more than 700 assessing units and taxing jurisdictions in the state where the railroad owns property be included as a class in the suit. The suit names six individual taxing jurisdictions as representative of the class: the City of Binghamton, the City of Rochester, Erie County, the Town of Hyde Park, the North Rockland Central School District, and the Village of Cornwall.
 Conrail operates a rail freight network in 14 Northeastern and Midwestern states, the District of Columbia, and the Province of Quebec.
 -0- 9/20/93
 /CONTACT: Robert L. Libkind or Richard W. Husband of Conrail, 215-209-4594/
 (CRR)


CO: Consolidated Rail Corporation ST: Pennsylvania, New York IN: TRN SU:

MK -- PH031 -- 3823 09/20/93 16:29 EDT
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Publication:PR Newswire
Date:Sep 20, 1993
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