Put away the "For Sale" sign.
After months of study and speculation, New Orleans officials are backing off the idea of possibly selling the Public Belt Railroad, which includes 25 miles of track that connect the six major rail lines serving the city's port and nearby industrial facilities.
Instead, city officials will consider two different models for the city-owned railroad: maintaining the status quo, with the city investing money for capital improvements in exchange for financial concessions, or a long-term public-private partnership with an operator that would invest money in the railroad while the city retains ownership.
Ryan Berni, a top aide to Mayor Mitch Landrieu, provided the update Thursday during the Public Belt board's monthly meeting.
The railroad's future has been uncertain for months during a study of potential business models that the city could pursue, a study that until Thursday had included a possible sale.
An outright sale was controversial among local trade groups and maritime leaders, who worried that giving up control of the railroad could push prices higher for some users or lead to preferential treatment for others.
The city's evaluation weighed financial, legal and operational factors, like potential job growth, increasing regional freight volumes and establishing a sustainable rail network. The review ultimately concluded that selling the railroad would "not be in the best interests" of the city's taxpayers, businesses and key stakeholders like the Port of New Orleans, Berni said.
Instead, the city will continue to work with the consulting firm KPMG to explore entering into a public-private partnership that would allow it to retain ownership of the railroad while attracting private investment that could be used to improve the line's efficiency and safety.
The city plans to solicit proposals from potential private-sector partners. At the same time, officials will review whether potential capital investments in infrastructure and real estate development could generate revenue for the city, Berni said.
The process, which could last several months, will operate in two phases. At first, proposals will be non-binding, in order for the city to gauge initial interest. Assuming it attracts interest, the city can evaluate the responses before requesting final, binding proposals.
Already, the city has sought feedback from various companies to find out if private investment potential exists, Berni said.
Still, a few business leaders who rely on the railroad spoke out against the plan at Thursday's meeting. They contended that drawing out the study process will create uncertainty that will hamper business. They urged the city to consider alternative ideas, such as pursuing a partnership with the port.
"It seems the most simple, streamlined, lack of legal bureaucracy would be for the port to look at this," said David Kearney, president of the Kearney Companies, a third-party logistics firm.
Speculation about a potential sale of the railroad had swirled for two years. In January 2015, Thomas Coleman, the former CEO of International Matex Tank Terminals, announced his interest in buying the railroad. (Coleman is the father of Dathel Georges, who owns The Advocate along with her husband, John Georges.)
Even before that, Landrieu had urged the board to consider selling the railroad, which could provide a cash infusion for the city.
Earlier this year, the city hired KPMG to evaluate the city's options. The firm has estimated the railroad's value at between $61 million and $196 million, not including the Huey P. Long Bridge over the Mississippi River in Jefferson Parish, which the agency also owns.