export -n RAILS_ENV
Setting an environment variable to nothing is not the same as removing it entirely. If really need it to go away completely, use the -n flag on export.
Behold:
<code>
jason@idaho:~/Code/subakva$ env | grep RAILS_ENV
jason@idaho:~/Code/subakva$ export RAILS_ENV=development
jason@idaho:~/Code/subakva$ env | grep RAILS_ENV
RAILS_ENV=development
jason@idaho:~/Code/subakva$ export RAILS_ENV=
jason@idaho:~/Code/subakva$ env | grep RAILS_ENV
RAILS_ENV=
jason@idaho:~/Code/subakva$ export -n RAILS_ENV
jason@idaho:~/Code/subakva$ env | grep RAILS_ENV
jason@idaho:~/Code/subakva$
</code>