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The recent extension of the short-line tax credit is a "game changing" piece of legislation for hardwood and softwood tie demand in 2013, according to the Railway Tie Association (RTA). An updated econometric tie demand forecasting model shows 500,000 to 1.2 million ties will be added to market demand this year, RTA officials said in a release issued to members.

"This raises the total 2013 forecast for new wood tie demand to 23.3 million on the low end, to an upper end of 24 million," they said. "This is an immediate positive for loggers, sawmills and wood treaters."

The American Taxpayer Relief Act (H.R. 8) that was enacted on Jan. 2 extended the Section 45G tax credit for two years: retroactive to Jan. 1, 2012, to cover last year and through Dec. 31 to cover 2013. The Section 45G provision enables short lines to claim a tax credit of 50 cents for every dollar invested in track rehabilitation, up to a cap equal to $3,500 times the railroad's total track miles.

To extend the tax credit beyond 2013, lobbying work needs to begin now, said RTA Executive Director Jim Gauntt in the release.

"There are 81 new members of Congress, very few of which will have any knowledge of, or experience with, the railroad industry. Likewise, of the 255 co-sponsors of the just-passed 45G legislation, 47 are now gone and will have to be replaced with new co-sponsors," he said. "As we have done in the past, we need to do our part by bringing the message to the congressmen who represent us and understand the importance of our facilities."