CSX Florida Panhandle route line-sale deal falls through

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CSXPanhandlesale
CSX's Florida Panhandle route
TRAINS: Rick Johnson/Steve Sweeney
JACKSONVILLE, Fla. — It’s a failure to launch for the Florida Gulf & Atlantic Railroad.

Federal regulators had approved the sale of 373 miles of CSX Transportation trackage across the Florida Panhandle, effective Jan. 6, but CSX and short line operator RailUSA scuttled their deal last week.

“CSX and RailUSA were unable to come to terms on a transaction for CSX tracks through the Florida Panhandle,” CSX said in a statement. “CSX will continue to evaluate options for the rail line and will continue communicating with customers, union representatives, and employees as we move forward.”

In November regulatory filings with the Surface Transportation Board, RailUSA said it would acquire CSX’s Tallahassee Subdivision between Baldwin, Fla., and Chattahoochee, Fla., the P&A Subdivision between Chattahoochee and Pensacola, Fla., and portions of the Bainbridge Subdivision between Tallahassee and Attapulgus, Ga.

The Florida Gulf & Atlantic planned to hire 37 people in Tallahassee to run the railroad.

Florida Gulf & Atlantic was to be the second acquisition for RailUSA, a new company headed by Gary Marino, an industry veteran who founded shortline holding companies RailAmerica and Patriot Rail. RailUSA is a subsidiary of International Rail Partners. Both companies are based in Boca Raton, Fla.

The Panhandle route once hosted Amtrak’s Sunset Limited, which ran between Orlando, Fla., and Los Angeles. It was cut back to a New Orleans-Los Angeles routing after Hurricane Katrina damaged Gulf Coast trackage east of New Orleans in 2005.

The line currently is Class 4 trackage with maximum speeds of 60 mph for freight trains. CSX has rerouted most through traffic off the Panhandle line to its parallel route via Waycross, Ga., and Montgomery, Ala.

RailUSA officials did not immediately respond to a Trains email seeking comment.

It was unclear whether the government shutdown — which includes the STB — would have an impact on CSX’s ability to spin off the line to a new operator.

The line sale was scheduled to be the second in CSX’s line-rationalization program. The first was the Decatur & Eastern Illinois Railroad, which Watco began operating in September.
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