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DM&E project delays threaten economic opportunities - call for railroad corrections bill

Thirty-nine statewide organizations, communities and businesses are urging the Governor and state legislature to correct South Dakota's eminent domain laws that are currently being manipulated to delay a project important to South Dakota's future. The groups expressed frustration over delay tactics designed to block the Dakota, Minnesota and Eastern Railroad's expansion and upgrade project.

"We all want fairness for the landowners," said David McGirr, Mayor of Huron, "and believe that if the merits of the issue are ever allowed to be argued it will prove that DM&E has been fair. But it's time to get on with this project that so many of us have been waiting for so long to happen."

Affected landowners also want the delay tactics to stop because they have worked out fair deals with DM&E. "Eminent domain must be and always has been a last resort for the DM&E to acquire the land it needs for the expansion," said landowner Leonard Benson of Oral, SD, whose ranch will be crossed by the new line. "A very fair and workable agreement was worked out with DM&E as to the movement of livestock. DM&E has a solid record of working fairly with landowners through the landowner outreach program. The delays only serve to create greater uncertainty in the future for all of us involved. The legislation would ensure that the process can move forward, all sides can be heard and a decision made."

Senate Bill 174 was introduced in the state legislature last week by Sen. Tom Hansen, Huron, and Rep. Tim Rave, Baltic. Its purpose is to correct what are viewed as deficiencies in existing law. It is supported by a group of legislators from both houses. The organizations sent a letter to the governor and legislators, urging swift action on the bill.

"An example of the tactics this legislation addresses is the opponents' effort to stall hearings to determine whether DM&E has already negotiated in good faith with landowners," said Hansen. "If the railroad had not acted in good faith, this hearing would be a great opportunity for opponents. Opponents don't appear to want to argue that on its merits."

In May, all parties, including the opponents, accepted holding the Transportation Commission hearing on July 10th to address all issues. Then after two months, on the day before the hearing, opponents used court delaying tactics to avoid the hearing.

South Dakota's agriculture groups also support the bill. "South Dakota agriculture has been among the staunchest of allies in fighting for the DM&E upgrade," said Scott VanderWal of Volga, president of the South Dakota Farm Bureau Federation. "The reason for our support is very simple, viable, competitive rail service is an absolute lifeblood for successful farming. Grain, fertilizers, ethanol, all must be transported by rail. We're confident this bill will find the support it needs in the legislature to pass and become law. It's absolutely critical to moving this project forward. This is a matter of fairness and certainty in the eminent domain process for all involved. That includes landowners, railroads and those who depend on rail service."

Small communities and state economic development groups also are urging passage of the bill. "Transportation is a key component of any economy," said Dave Schneider, mayor of Belle Fourche. "The improved DM&E line means better connections to key markets, which are essential for the current industries in Belle Fourche to remain competitive. We also see the possibilities it could open up for new development. That means jobs and investment. For many communities on the line, this service will determine our economic growth for decades to come."

"Procedural delays mean that economic development is delayed, and it's communities that are paying the price," said Jim Borszich, executive director of the Greater Huron Development Corporation. "The DM&E project holds tremendous economic potential for the communities on the line and the entire state. To date, DM&E has spent over $100 million to advance the $6 billion project. This legislation closes gaps in the current law while living up to South Dakota's approach to responsible business development."

The proposed legislation preserves the rights and protections landowners deserve, but it also provides definitive timelines for the Transportation Commission to do its job in hearing all sides of an application and deciding whether to authorize the use of eminent domain. It also provides a reasonable timeline for the railroad to access land that is subject to eminent domain.

A letter in support of the measure was signed by 40 ag organization leaders, mayors and board presidents of cities along the railroad line, economic development leaders, ag business owners and managers and other businessmen and community leaders. Local signees were Joe Woitte, board president, City of Midland, John Hart, mayor, City of Philip, and David Hahn, mayor, City of Wall.