Union Pacific files complaint against Tulare County

Railroad alleges county is charging railroad higher property taxes than other property owners

TULARE COUNTY – In a closed door battle that could be described as a potential “train wreck” for Tulare County, Union Pacific Railroad has raised the signal on a draft complaint, claiming the county’s assessment of a unitary tax has been running off the rails for roughly six years. 

At its Nov. 7 meeting, during closed session, the Tulare County Board of Supervisors (Board) addressed a draft complaint filed by Union Pacific Railroad against the county alleging that, since 2017, the county assessed the railroad a unitary tax at a higher rate than what it assesses other property owners.

It is not known when the results of the closed session will be made available to the public.

According to an item on the Nov. 7 meeting agenda, “Union Pacific Railroad contends that the unitary tax rate applied to their property within the county exceeds that permitted under federal law.”

Under a unitary tax, governments treat a multinational corporation as a group made up of all its local branches, instead of treating each local branch as an individual entity separated from the global chain.

Meg Ronspies, a corporate communications manager with Union Pacific, disputed a report in the Porterville Recorder that the company filed a draft complaint with the Eastern District Court of California.

“After talking to the team, here’s what I can tell you – Union Pacific has not filed a complaint,” Ronspies said in an email to the Mid Valley Times/Sun-Gazette.

However, this assertion is rebutted by the fact the law firm of Baker, Donelson, Bearman, Caldwell and Berkowitz, P.C. out of Chattanooga, Tenn. did file a complaint for injunctive relief against Tulare County in the Eastern District Court of California.


Union Pacific contends its unitary tax rate– its tax liability – is “calculated under a different formula from the tax rate for other commercial and industrial property in California,” according to the complaint. The complaint also alleges Tulare County goes against the finding in BNSF Railway v. County of Alameda, where the court found that Section 11501 of the United States Code (U.S.C.) “prohibits States and localities from taxing railroad property ‘at a tax rate that exceeds the tax rate generally applied to commercial and industrial property in the same jurisdiction.’”

According to the complaint, since 2017, Tulare County has charged Union Pacific a unitary tax rate in excess of the benchmark rate – that is, the tax rate at which other property owners in the same commercial area were assessed – as established by Section 11501.

For example, in the 2017-2018 tax year, Union Pacific’s unitary rate was 1.3408%; the benchmark rate was 1.1060%. For the 2022-2023 tax year, the railroad’s unitary rate was 1.3589%; the benchmark rate was 1.0930%. For this year, Union Pacific’s rate was 1.3596%; the benchmark rate was 1.0870%.

Through this legal action, Union Pacific is attempting to prevent Tulare County from collecting property taxes for this tax year. The railroad is also seeking “such further equitable relief to which it may be entitled.”


The Mid Valley Times/Sun-Gazette reached out to Baker, Donelson, Bearman, Caldwell and Berkowitz, P.C., but did not receive a reply. According to the county counsel for Tulare County, Union Pacific is taking similar legal action in every county in the country in which it operates and has property.

This is a considerable undertaking, considering that the railroad connects 23 states in the western two-thirds of the country. According to Union Pacific’s website, the railroad “operates from all major West Coast and Gulf Coast ports to eastern gateways, connects with Canada’s rail systems and is the only railroad serving all six major Mexico gateways.”

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