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The inner cabinet for economic and social affairs last week authorized Israel Railways director-general Yossi Snir and the finance ministry's Accountant-General Nir Gilad to compile a list of areas under the railway authority's control which could be developed by the private sector, Snir revealed in a press conference Tuesday.

Speaking to journalists in Tel Aviv, Snir said the purpose of the list was to extend the franchise that the railroad has on these tracts from three years to a longer period. Snir said the list would be presented to the cabinet within 60 days.

The cabinet decision was intended to resolve a 14-year-old dispute between Israel Railways and the treasury over control of the land. Israel Railways has some 30,000 dunams of land throughout Israel, including tracts in prime commercial and residential areas, intended for future tracks or for warehousing and maintenance facilities. Israel Railways leases some of the tracts to businesses and industry, collecting rent to the tune of NIS 30 million a year, which is used for development projects.

Snir explained that Israel Railways has been prevented from renting out the tracts since the start of 2001 because the treasury decided not to renew franchise agreements with Israel Railways, which were renewed every three years in the past.

The source of the problem goes back to the British Mandate period, when British authorities registered the tracts in the name of the state and Israel Railways, for the development of train tracks. At that time, Israel Railways was administered directly through the government, but in 1988 it became part of the Railway and Ports Authority, a separate statutory body, and the land was supposed to be eventually transferred to the Authority. Negotiations over the transfer have been going on ever since.