Dauphin County, Swatara Township, City of Harrisburg, Central Dauphin and Harrisburg School Districts fight court's ruling allowing Norfolk Southern Railroad to keep its intermodal yards tax exempt

HARRISBURG, PA (November 8, 2018) Following a Commonwealth Court case from the Lehigh Valley in February of 2018 that determined railroad intermodal yards are exempt from the Public Utility Realty Tax (PURTA), Dauphin County and other taxing authorities that host Norfolk Southern Railroad (NFS) have filed a joint appeal in court to fight for $2.14 million that taxing authorities will lose annually as a result of this finding.

Although Dauphin County was not involved with the case, Lehigh Valley Rail Management LLC v. County of Northampton Revenue Appeals, it has an impact locally.

In response to the court’s ruling, the Dauphin County Board of Assessment Appeals granted exemption for NFS’s intermodal yard in Swatara Township and the City of Harrisburg in September of 2018. Other counties have granted tax exemptions in the wake of the court’s ruling.

“This big tax break for the railroad puts a heavy burden on taxpayers,” said Commissioner George P. Hartwick, III, who oversees the county’s Tax Assessment Office. “We intend to fight the railroad’s claim to tax exemption under this archaic law, PURTA, that will leave the county and several taxing authorities, especially Harrisburg and Central Dauphin School Districts, with a revenue deficit.”  

The following NFS properties in the county have been deemed tax exempt based on the court’s finding:

  • 4250 Industrial Road in the City of Harrisburg, and
  • Rutherford Yard, Milroy Road, 7750 Grayson Road, 7150 Grayson Road, and Derry Street L9 in Swatara Township.

The total assessed value of these properties is $53,512,300.

“Norfolk Southern owns a great deal of property in Dauphin County,” said County Board Chairman Jeff Haste, “and it’s only right the railroad pay its fair share of taxes,” said County Board Chairman Jeff Haste. “This loss of revenue is immediate and will be felt for years to come.”

The other taxing authorities affected by this ruling – the City of Harrisburg, Harrisburg School District, Central Dauphin School District and Swatara Township – have joined the county’s appeal to have the tax exemption overturned.

Because NFS initially filed a request for tax exemption with the county’s Board of Assessment Appeals in 2015 and continued to pay taxes on the intermodal yard through September 2018, the taxing authorities must refund a total of $6.8 million to the railroad.

“This case shows why we need a legislative fix to this outdated law,” said Commissioner Mike Pries. “The bottom line is, we have an obligation to protect taxpayers.”

The appeal is filed in Dauphin County Court.