Personal Income Tax Law: Corporation Tax Law: credits: shortline railroad expenditures and railroad infrastructure.
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Majority
Fiscal committee
No
Appropriation
No
Current location
Appropriations
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Progress
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- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Overview
This bill, the Shortline Railroad Modernization Act of 2026, creates tax credits for qualified shortline and regional railroads in California. It allows these railroads to claim credits for 50% of their qualified expenditures for railroad infrastructure maintenance and improvements starting in 2026, and 50% of new rail infrastructure expenditures starting in 2028. The bill also establishes a process for obtaining credit certification and sets limits on the total amount of credits that can be allocated annually. Additionally, it includes provisions for carrying over unused credits and requires detailed reporting to ensure the credits are used to achieve specific goals related to rail safety, access, and environmental benefits.
Key provisions
- Allows a 50% credit for qualified shortline railroad expenditures (maintenance and improvements) from 2026-2031.
- Allows a 50% credit for qualified new rail infrastructure expenditures from 2028-2032.
- Establishes a process for obtaining credit certification through an application and department review.
- Limits the total amount of credits that can be allocated annually to $7 million and $10 million respectively.
- Provides for the carryover of unused credits for up to five years.
- Requires detailed reporting to the legislature on the use of the credits and their impact.
- Specifies criteria for prioritizing applications, including projects supporting industrial access and environmental sustainability.
- Includes provisions for assigning credits to other taxpayers.
Who is affected
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1 on record
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