Authority months away from seeking purchase offers for Luzerne County rail line

Luzerne County’s Redevelopment Authority is months away from seeking purchase offers to buy or lease its rail line.

The authority board approved a contract Tuesday with Trenton, N.J.-based Strauss & Associates/Planners to document county rail line assets and help prepare the public request for proposals.

This contract is capped at $20,000, with authority board approval required to exceed that amount.

Authority Board Chairman Scott Linde said he is hopeful Strauss will complete its due diligence and prepare a final report by February, and another 30 to 60 days would be needed after that to prepare and release the request for proposals.

However, Linde cautioned that the time estimate is “speculative at best.”

Reading & Northern Railroad Chairman and CEO Andy M. Muller Jr. had made an unsolicited offer to purchase the line for $10 million in October, stating that he would increase freight service and introduce passenger train excursions from Wilkes-Barre to Pittston. These are not commuter routes, but they would connect Wilkes-Barre to popular tourism train rides, such as existing excursions Reading & Northern operates from Pittston to historic Jim Thorpe.

Although initially resistant to non-public rail ownership, authority representatives decided offers should be considered, but only in a public process open to all interested entities.

Letters show the county wants the authority to turn over the railroad so it can be sold to recoup $3.28 million that had been loaned to the authority for the rail line. A county council-authorized lawsuit filed against the authority in July is now in the discovery phase.

While the delinquent loan was cited as a reason for the county litigation, it appears to be part of a broader effort to privatize the track, with the hope of adding passenger rail excursions while expanding commercial use.

The suit seeks court appointment of an oversight receiver or a declaration that the $3.28 million the county loaned to the authority is immediately due. The county suit is also against the nonprofit Rail Corp., which maintains a lease agreement with the rail operator, R.J. Corman Railroad Group.

The authority and Rail Corp. have argued there is no breach of contract to litigate because the authority has until October 2026 to repay the county.

Upon convening Tuesday’s meeting, authority representatives immediately met in closed-door executive session for approximately one hour to discuss the pending litigation and real estate matters.

Linde said Tuesday the expertise of Strauss & Associates/Planners is needed to assess all holdings in multiple municipalities, including approximately 30 miles of active line currently operated by R.J. Corman and 25 or so miles of inactive line largely “behind people’s houses.”

“We have to get a good inventory of what we own,” Linde said, adding his usual notation that the authority is “looking to work with the county.”

The board discussed interest from two entities to purchase authority property on Tuesday, but Linde said the authority cannot sell or transfer property while the litigation is pending.

The two inquiries presented on Tuesday:

• Steamtown National Historic Site is interested in authority-owned land near the former Rocky Glen Amusement Park in Moosic. Unlike most authority property, this parcel is in Lackawanna County, representatives said.

• Forty Fort is interested in acquiring a section of the authority’s former Kingston Industrial Line needed to access a parcel it wants to acquire to construct a maintenance facility. While a sale is not possible at this time, the board may consider granting a temporary easement on its property for construction purposes, members said.