Unique profit center.

• Position: CSX Tax Department - From 'Connections,' number 3, 1992

(This article is reprinted with permission from CSX Corporation's employee magazine, Connections, Number 3, 1992. L. Wayne Farrell of the Virginia Chapter served as TEI's 1984-1985 President.)

Nothing is certain but death and taxes. While there may be considerable truth to that adage Wayne Farrell would scoff at such a despairing approach to tax planning.

As CSX vice president-taxes, Farrell is responsible for all aspects of the tax affairs of CSX and its operating units. His ultimate responsibility is to make sure CSX pays as little in taxes as necessary, while complying with all local, state, federal and foreign laws.

While it's inevitable that a profitable company like CSX will pay plenty in taxes, how, when and where those taxes are paid can have a big impact on the company's overall performance. In the case of CSX, aggressive tax planning can save the company millions of dollars. Since tax savings flow directly to the bottom line, the tax department's staff can make a significant impact on the corporation's overall profitability.

In addition to tax planning, the department handles all CSX tax compliance, audits, appeals and litigation efforts. The staff also proposes and drafts tax legislation and helps advance CSX's position on tax proposals.

Viewed as Profit Center

The tax department boosts CSX's performance by helping the operating units improve their profitability through effective tax planning. "We truly look at our department as a profit center -- in terms of bringing money to the bottom line," Farrell said. "We work very closely with the units to help them improve their operating ratio and net income."

Maintaining a close working relationship with the operating units is critical to the success of the tax department's mission, said David Bowling, senior tax counsel-special projects. "The tax department relies on information from all levels of the company. The more we know about what's going on throughout CSX and the sooner we know it, the better we are able to do effective tax planning and ultimately minimize the tax impact to the company."

One important part of the department's tax-planning efforts involves working with CSX's state relations and federal affairs groups to support or fight legislation that could have a significant impact on the company, noted Jim Peter, senior tax counsel-corporate.

Leading the department's state legislative efforts is Courtney George Hyers, associate tax counsel and director-state tax legislation and litigation. She drafts proposed legislation, testifies before legislative committees, writes...