Cincy Council Member Says Sell Rail Line

A Cincinnati City Council Member has proposed selling the Cincinnati Southern Railway and using the proceeds to pay off an $870 million unfunded pension liability.

But Cincinnati mayor John Cranley opposes the idea because the rail line between Cincinnati and Chattanooga, Tenn., that is operated by Norfolk Southern is a continual source of revenue for the city.

The Cincinnati Enquirer reported that council Finance Chair Charlie Winburn thinks the line would fetch $500 million, Previous city administrators have put the line’s worth at $1 to 2 billion.

The 336-mile rail route, which is known as the Rat Hole, is operated by the Cincinnati, New Orleans, & Texas Pacific Railway, a part of NS.

It is the only such long-distance railroad route in the United States route owned by a municipality. The NS lease of the route expires in 2026, but has an option for a 25-year renewal.
The trustees of the Cincinnati Southern are appointed by the mayor of Cincinnati and govern the agreement.

NS pays more than $20 million annually to lease the line. Since a 1987 renegotiation, NS has paid the city $432 million in lease payments, all of which go directly into Cincinnati’s capital budget.

The revenue is set aside for such capital as maintaining roads and bridges. “If you took that money away, we’d still be under the charter obligation to fix the infrastructure, which in turn could mean higher taxes,” Cranley said.

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