The Provincial government sold the railway to the Itel Rail Group in 1988. The railway was renamed the Southern Railway of British Columbia. The line was originally built in 1910 as the British Columbia Electric Railway (BCER), an interurban trolley service for passengers (until 1950) as well as for freight such as farm produce. The railway was taken over by Crown corporationBC Hydro in 1961 and was known as the BC Hydro Railway. In 1994 it was bought by Washington Group International but kept the SRY name. The Washington Group has since merged with URS.
To this day the Province and BC Hydro retain the right to reintroduce passenger service. In recent years, with congestion and growing environmental concerns, there has been increasing demand for this service, and willingness to pay, from persons wishing to travel among Fraser Valley communities other than by private automobile.