Iowa Administrative Code › Agency 701 - Revenue Department › Title II - Property Tax › Chapter 106 - Determination of Value of Railroad Companies › Rule 701-106.1 - Definitions of Terms

Current through Register Vol. 47, No. 3, July 24, 2024
(1) The term
"railroad"
shall mean and include all individuals or
				corporations engaged in the operation of a railway in this state and subject to
				valuation pursuant to Iowa Code chapter 434.
(2) The term
"unit value"
or
"unit market value"
shall mean the market value arrived at by
				using the appraisal method of valuing an entire operating property, considered
				as a whole and capable of performing the function for which it was created,
				such as (by way of illustration and not limitation) transporting freight over
				rail.
(3) The term
"operating property"
shall mean all property owned by or
				leased to a railroad company, not otherwise taxed separately or made nontaxable
				by law, which is necessary to and without which the railroad could not perform
				the activities for which the railroad is formed, such as (by way of
				illustration and not limitation) transporting freight over rail. With regard to
				property whose identity as "operating" or "nonoperating" property is not
				clearly ascertainable, the property shall be considered operating property if
				the railroad could not reasonably be expected to perform the referenced
				activities in the absence of such property.
(4) The term
"nonoperating
				property"
shall mean all property owned by a railroad not defined by
				subrule 76.1(3) as "operating property."
(5) The term
"comparable
				sales"
shall mean actual sales transactions, between willing buyers
				and willing sellers, neither being under any compulsion to buy or sell, of
				property which is similar in purpose, function and design to the property to
				which the comparison is being made. Where the determination of a unit value is
				being made, the sale of a portion of a unit which is nominally similar in
				purpose and function to the unit being valued shall not be considered a
				comparable sale, absent proof by evidence other than the terms of the sale
				itself, that the sales price was based on some unit of measurement which is
				common both to the property sold and the property being valued and which is not
				affected by the fact that less than the entire unit is being sold, such as (by
				way of illustration and not limitation) (1) the price per mile of track and (2)
				the price per square foot of the property.
(6) The term
"income approach to unit
				value"
shall mean the estimate of unit market value obtained by
				dividing an appropriate income stream by an appropriate and compatible discount
				rate.
(7) The term
"stock
				and debt approach to unit value"
shall mean the estimate of unit
				market value determined by combining the estimate of market value of the stock,
				debt, current liabilities, other liabilities, including capital leases, and
				deferred credits associated with the operating property of a railroad
				company.
(8) The term
"cost
				approach to unit value"
shall mean the estimate of value determined by
				combining the original cost less a depreciation allowance for the operating
				property of a railroad company.
(9)
				The term
"respondent"
shall include the railroad company whose
				property is to be valued.
(10) The
				term
"leased assets"
shall mean capital leases.
(11) The term
"original
				cost"
shall mean the actual cost of the property to its present owner,
				not the first cost at the time it was originally constructed and placed in
				service.
This rule is intended to implement Iowa Code chapter
				  434.