By Jeremy Boren

Published: Monday, January 28, 2013, 12:58 p.m.
Updated: Tuesday, January 29, 2013

An Oakmont-based railroad operator is suing to overturn a special zoning district Pittsburgh City Council formed in the Strip District to help The Buncher Co. build a residential, office, hotel and retail development on a mostly barren stretch of asphalt along the Allegheny River.

Allegheny Valley Railroad is trying to exercise control over a sliver of land between 16th and 21st streets that no longer has railroad tracks and serves mainly as a loading dock hub for tractor-trailer trucks and commuter parking.

Officials with the railroad believe the area still has value to them because of a long-standing easement that once gave trains access to the produce wholesalers' destination on the north side of the building.

“Regardless of whether or not we're currently using that, there's a decision from the (federal) Surface Transportation Board which says that easement has not been abandoned and is still ours,” said Jonathan Kamin, an attorney for the railroad.

The lawsuit, filed Friday in Allegheny County Common Pleas Court, contends the ordinance that council approved in December to establish the “specially planned” zoning district violates a provision of the city code that requires the developer, in this case Buncher, to control all the land in a specially planned district.

The code provision says control is established through “ownership or sales option.” Buncher owns much of the land in the question and has an exclusive option to purchase the Produce Terminal from the city Urban Redevelopment Authority. The lawsuit does not specify damages.

“We believe the legislation was duly enacted and there were no procedural errors,” said Pittsburgh solicitor Daniel Regan.

Kamin said the URA paved over the tracks closest to the Produce Terminal in the mid-1990s. He said his client warned council members about the problem before they approved the ordinance.

On Thursday, attorneys for the railroad and the URA are scheduled to begin a trial on a related legal dispute over how the terminal can be used.

Buncher wants to demolish one-third of the building, renovate the remainder and rent it to retail establishments. The railroad sued to prevent that, arguing that the URA agreed when it bought the building in 1981 to use “best efforts” to give space to produce wholesalers or provide for “rail-oriented use.”

Buying and renovating the Produce Terminal is key to Buncher's larger vision of redeveloping a 55-acre tract it owns along the Allegheny River, company officials have said.

Jeremy Boren is a staff writer for Trib Total Media. He can be reached at 412-320-7935 or jboren@tribweb.com.

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