(The Billings Gazette posted the following Associated Press story on its website on May 1.)
CHEYENNE, Wyo. — A judge has ordered Wyoming not to collect two taxes the Legislature imposed on railroads in 2000.
U.S. District Judge Alan Johnson ruled April 22 in favor of Burlington Northern and Santa Fe Railroad and Union Pacific Railroad, forestalling a civil trial that was scheduled to begin next Monday.
The railroads claimed the coal transportation tax and train mile tax discriminated against railroads in violation of the 1976 federal Railroad Revitalization and Regulatory Reform Act.
Besides permanently enjoining the state from collecting the taxes, Johnson said it must repay the railroads all costs associated with them.
The railroads filed the lawsuit in May 2000, naming as defendants Johnnie Burton, then-director of the Department of Revenue, and Department of Transportation Director Sleeter Dover.
The transportation tax levied 0.1 cent per ton, per mile on coal hauled in Wyoming. Coal is moved almost exclusively by rail in Wyoming and the tax was estimated to raise more than $6 million a year.
The train mile tax was an excise tax of 7 cents for each mile a train operates in Wyoming, plus $100 for each public at-grade crossing. It was to raise an estimated $1.5 million a year.
The coal transportation tax was to benefit the Permanent Mineral Trust Fund and the per-mile tax was to improve rail crossings.
Anticipating that railroads might contest the legislation, lawmakers wrote it so that revenue from the coal transportation tax went into an escrow account that would be used in case of a lawsuit.
“We are pleased the court supported our position that railroads should not be subject to discriminatory taxes,” said BNSF spokesman Gus Melonas.
An attorney for the railroads, Perry Dray, was unavailable for comment. A call to the state attorney general’s office was not returned.