The Surface Transportation Board issued a decision saying, "We continue to have serious concerns regarding what appears to be Conrail's 1996 sale of a line without board authorization."

The board requires railroad companies to serve notice when they plan to stop using a line, or sell it. The process is referred to as abandonment.

Conrail's explanation is due July 1. A spokesman for the company declined to comment, but said the company would comply with the board's requests.

In 2008, Conrail petitioned the board to abandon a stretch of the Lehigh Valley Main Line in Jersey City. The line runs along the New Jersey Turnpike Extension and Communipaw Avenue.

During the application process, a freight rail company expressed interest in the line and asked how much it would cost. At that time, Conrail disclosed that a portion had been sold to NJ Transit and is being used by the Hudson-Bergen Light Rail, including an active maintenance yard.

"Conrail should explain when, under what authority, and under what circumstances it purported to discontinue service on the line," the STB decision states. "Also, Conrail is ordered to disclose to the board all of its line or partial line sales and all of its discontinuance of services since Jan. 1, 1996."

The Lehigh Valley Main Line is not the only portion of rail in Jersey City that Conrail has been accused of improperly abandoning.

Conrail and developer Steve Hyman, whose wife purchased an eight-block parcel along Sixth Street from the rail company, have been in court defending the land sale.

The City of Jersey City, the Embankment Preservation Coalition, a community group, and Rails to Trails, have filed a lawsuit arguing that Conrail did not properly abandon the line and should have offered it to Jersey City before selling it to Hyman's wife for $3 million in 2005.

Conrail and Hyman have argued that the line is exempt from the abandonment process. The matter is in U.S. District Court in Washington, D.C.

Charles Montange, an attorney hired by the city who is also representing the coalition and Rails to Trails, praised the Surface Transportation Board's decision.