Hopes of reopening an old railway line to passengers could be scuppered after the sale of land along the route was approved.
The land is wanted by its current leaseholder, property developer Mucklows. It said it had a client ready to invest in the site – but only if the tenancy was secure.
But opposition councillors claimed the decision could end up hitting taxpayers in the pocket if the land needed to be compulsorily purchased should the rail scheme proceed in the future.
The route, which carried trains from Birmingham to Gloucester, closed to passengers in 1941 and is now a freight-only line.
But part of the track would cut across a portion of the council-owned land wanted by manufacturer Sulzer Dowding and Mills to expand its operation in the area.
The firm services and makes components used in high-voltage electrical generation and the development would safeguard 200 jobs, it was thought.
Council deputy leader Coun Ian Ward (Lab, Shard End) told the committee that Mucklows had a 38-year lease and was looking for something more permanent.
He said: “Should the Camp Hill Chord go ahead it would require the compulsory purchase of land.
“The cabinet was aware of that when it made the decision to sell the land. The type of development the owner wants to carry out is a planning matter.”
And his cabinet colleague responsible for jobs and development, Coun Tahir Ali (Lab, Nechells), said the projected £150 million cost of reopening the line meant the project may not proceed for some time.
Tory transport spokesman Coun Timothy Huxtable (Bournville) said the development of New Street Station did nothing to increase rail capacity and the Camp Hill line was required.
But his case failed to convince the five Labour members of the committee, who supported the sale.
The Camp Hill Chords project would allow a suburban line to be run into Moor Street, one from Kings Norton through Kings Heath and Moseley and one from Tamworth through Kingsbury, Castle Vale and Fort Parkway.