RailUSA Buys CSX Line Across Florida Panhandle

RailUSA Buys CSX Line Across Florida Panhandle

A new team with veteran players in the shortline game notched its second win when RailUSA succeeded in acquiring the latest line to be spun off by CSX this year, its former route across the Florida panhandle from just outside Jacksonville on the Atlantic coast to Pensacola on the Gulf of Mexico.

If RailUSA sounds familiar, that’s because it’s the latest project of RailAmerica founder Gary Marino, who later founded Patriot Rail. With two shortline holding company success stories to his credit and a team of veterans from those ventures, Marino has reentered the field with the backing of controversial Chicago real estate investor Sam Zell though his private investment company, Equity Group Investments. With EIG support, Marino created subsidiary RailUSA as a subsidiary of his International Rail Partners in April. The new company acquired its first line from Iowa Pacific Holdings in August, the Grenada Railroad between Jackson, Miss., and Memphis, Tenn., a former Illinois Central subdivision.

A new RailUSA shortline called Florida, Gulf & Atlantic Railroad will operate the 373-miles of former CSX panhandle trackage, according to a November 6 filing with the Surface Transportation Board. This includes the Tallahassee Subdivision between Baldwin and Chattahoochee, Fla., the P&A Subdivision between Chattahoochee and Pensacola, Fla., and parts of the Bainbridge Subdivision between Attapulgus, Ga., and Tallahassee.

The name recalls the Florida, Atlantic & Gulf, built in 1860 between Jacksonville and Lake City, the Baldwin to Lake City segment of which is included in the sale. The line west of Chattahoochee began operations as Pensacola & Atlantic in 1883, but became a part of Louisville & Nashville as the P&A Subdivision within a decade.

This line hosted Amtrak’s coast-to-coast Sunset Limited from 1993 until service east of New Orleans was suspended in 2005 due to damage from Hurricane Katrina. Congress has failed to provide additional funds or require Amtrak to restore the service, despite local efforts to revive the route extension. Backers of those efforts may find comfort in the fact that a key member of Marino’s team not from the freight railroad industry is an Amtrak veteran. An Amtrak report requested by the five-state Southern Rail Commission projected up to 153,000 riders a year on a restored New Orleans-Mobile-Orlando segment for the Sunset Limited.

The line was put up for sale by CSX in January, along with the Decatur and Danville Subdivisions in Illinois and Indiana, which were sold to Watco is September and are now operated as the Decatur & Eastern Illinois Railroad. In July, CSX segments in Alabama and Georgia, which buyer OmniTRAX was already leasing and operating as Alabama & Tennessee Railway and Fulton County Railway, respectively.

—Eric Berger, Railfan & Railroad

This article was posted on: November 12, 2018