Montana Code Annotated 2023



Part 2. Railroads

Definitions Relating To Taxes

15-23-203. Definitions relating to taxes. As used in this part, unless the context requires otherwise, the following definitions apply:

(1) (a) "Base value" means, except as provided in subsection (1)(b), the system value of railroad transportation property of a railroad in the preceding tax year.

(b) For tax year 1999, base value means the system value of railroad transportation property used to determine the railroad's Montana property taxes paid for the 1998 tax year.

(2) "Capitalization rate" means the capitalization rate reported by the surface transportation board, provided for in 49 U.S.C. 701, in its annual cost of capital report.

(3) "Change in earnings" means the value determined by dividing the average earnings for the 5 years immediately preceding the current tax year by the average earnings for the 5 years immediately preceding the previous tax year.

(4) "Change in the capitalization rate" means the value derived by dividing the current year capitalization rate by the preceding year capitalization rate.

(5) "Earnings" means income realized before deducting depreciation, interest expenses, lease expenses, and taxes.

(6) "Gross profit margin" means the ratio of earnings to operating revenue.

(7) "Leased property" means property that is subject to an agreement that transfers the use of the property to the lessee during the term of the lease and that is not capitalized on the lessee's balance sheet.

(8) "Operating revenue" means the amount of money that the railroad is entitled to receive or that accrues to its benefit from services rendered in transporting property or persons by rail.

(9) "System cost" means the total depreciated cost of all railroad transportation property, including leased property within the state and outside the state.

History: En. Sec. 3, Ch. 531, L. 1999.