How did California distinguish highway-designed truck cranes from units confined by design to construction or logging sites?

Plain-English summary

Audit staff asked how to classify several truck cranes and other mobile construction or logging units.

California said design controlled. A unit designed to move persons or property substantial distances over highways, under its own power or by towing, could be MTE even if a particular lessee used it only within a limited area. Equipment designed only for confined construction, loading, or logging sites was not MTE.

Speed Swing, Trak-Kleener, Pulpwood Hauler, and Forester units appeared limited to construction or logging sites and were non-MTE. Truck-Krane Models 90TKLS and 60TK and Wrecking Crane Model 200 were designed for highway movement and were MTE; special permits and an apparent 75-mile travel limit did not change that result.

The Multikrane was non-MTE on the stated facts: no substantial-distance transport, no speedometer or odometer, rough-terrain-only tires, no normal highway license, and long-distance relocation by carrier or another vehicle.

Evidence gaps and source-name differences

The memorandum responds to Downey Auditing's March 23 and May 24 requests. Its site-limited findings are based on a brochure; the highway findings refer to brochures and quote Model 60 advertising “fast road” speed; and the Multikrane findings quote selected numbered statements from J. A. Alexander's May 19 letter while replacing item 2 and other material with asterisks. None of those requests, brochures, the full letter, or the listed attachments is included.

The official PDF supplies no manufacturer evidence beyond the printed model names, dimensions, weights, capacities, chassis details, speedometer or odometer inspection, tire specifications, registration, highway permits, license records, speed or distance tests, carrier records, leases, actual use, tax measure, return, assessment, or payment. Several conclusions say the units “appear” designed a certain way; the page does not convert those source qualifications into verified equipment facts.

The PDF calls one unit “Pulpwood Hauler,” while the live 335.0089 annotation says “Pipewood Hauler.” The PDF first names Truck-Krane Model 60TK and later refers to a Model 60 brochure; the live page uses Model 60TK. The PDF says a Truck Krane “does not travel over the highways more than 75 miles” without a stated period, while the live entry says travel is limited to 75 miles “at a time.” These differences remain unresolved rather than silently harmonized.

Common questions

Did a lessee's actual site-only use control?

No. The memorandum focused on the unit's design.

Did special highway permits prevent MTE status?

No. Highway-designed Truck-Kranes remained MTE despite requiring permits.

Why was the Multikrane non-MTE?

Its stated features showed rough-terrain, site-limited design and reliance on other vehicles for substantial-distance movement.

Could the published PDF verify the model features and travel limits?

No. The brochures, full third-party letter, attachments, specifications, permits, licenses, and movement records are absent.

Citations and references

• California Sales and Use Tax Regulation 1661(b)(1)
• Downey Auditing's March 23 and May 24, 1976 memoranda — referenced but not included
• Equipment brochures, including a Model 60 “fast road” statement — referenced but not included
• J. A. Alexander's May 19 letter about the Multikrane — quoted incompletely but not included
• Unidentified attachments — listed but not included
• Unit specifications, permits, licenses, movement and use evidence, leases, and tax records — not included

Verbatim support

From the official June 10, 1976 memorandum:

We do not believe that merely because the particular leased unit is only used by the lessee in a limited area takes it out of the definition of mobile transportation equipment if in fact the unit is designed to move property or persons substantial distances.

I do not believe that merely because the “Truck Krane” does not travel over the highways more than 75 miles excludes it from the definition of substantial distances.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/335-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/335-0089.pdf

Original ruling text

State of California

Board of Equalization

Memorandum

To:

Downey – Auditing (GMS)

From:

Hdqrt – Tax Counsel (GLR)

Subject:

Truck Cranes as Mobile Transportation Equipment

335.0089

Date:

June 10, 1976

This is in regard to your memoranda of March 23 and May 24, 1976 directed to Mr. Nunes relating to the question of whether certain “truck cranes” and other mobile units are properly classified as mobile transportation equipment. As you are aware the classification of certain units is not always clear cut. However, in each case I think we must keep in mind the definitions contained in the first two sentences of Regulation 1661(b)(1). “The term ‘mobile transportation equipment’ includes only equipment for use in transporting persons or property for substantial distances. The term does not include items of a kind commonly used only in loading or unloading persons or property, or short distance moving within the confines of a limited area, such as a loading dock, warehouse, terminal, bay or airport.” In essence, we are to ask the question in each case as to whether or not the particular unit is “designed” to be moved substantial distances, say over the highways under its own power or by being pulled behind say a tractor or is limited in its “design” to be used in the confines of a limited area such as a construction site, loading area, etc. We do not believe that merely because the particular leased unit is only used by the lessee in a limited area takes it out of the definition of mobile transportation equipment if in fact the unit is designed to move property or persons substantial distances. Applying the foregoing principles to your specific questioned items, we make the following conclusions: Speed Swing, Trak-Kleener, Pulpwood Hauler and the Forester appear from the brochure to be designed for limited movement within the confines of a limited area, i.e., construction or logging site, and are not designed for highway use. Accordingly, it is our opinion those items are not mobile transportation equipment.

Downey – Auditing (GMS)

-2-

June 10, 1976
335.0089

Truck-Krane—Model 90TKLS and Model 60TK, Wrecking Crane Model 200 appear to be “designed” for movement on the highways. It may be true that they have to have a special license to be moved; nevertheless, they appear to be designed for long distance movement over the highways. The brochure regarding Truck Krane Model 60 even advertises “fast road” speed. The Multikrane doesn’t appear to be mobile transportation equipment under the above mentioned guidelines. This conclusion is based on the stated facts contained in J. A. Alexander’s letter of May 19. “1.

It does not transport persons or property for substantial distances.

“3.

It does not have a speedometer or odometer.

“4.

Its tires are suitable for rough terrain only.

“5.

It is not normally licensed for use on public highways.

“6.
It is [normally] transported from location to location of substantial distances by common carrier or customer vehicle.” I do not believe that merely because the “Truck Krane” does not travel over the highways more than 75 miles excludes it from the definition of substantial distances. It is clearly designed for movement on the highway notwithstanding the fact they have to have special highway permits.

GLR:lb
cc:

Mr. Robert Nunes }
Mr. T. P. Putnam } w/attachments
Mr. W. E. Burkett }