PIERRE, S.D. — The Dakota, Minnesota and Eastern Railroad is looking at upgrading tracks to transport coal from Wyoming coal fields, the Pierre Capital Journal reported.
Should the upgrade occur, the cities of Pierre and Fort Pierre will be faced with issues such as a local bypass, side tracks and crossings. A regional rail authority could assist local governmental entities with these challenges, according to David Hauschild, executive director of the Central South Dakota Enhancement District.
Issues the region will face should Dakota, Minnesota and Eastern Railroad move forward with its plans to upgrade tracks may be best addressed with a regional rail authority, according to David Hauschild, executive director of the Central South Dakota Enhancement District.
In a brief presentation at Monday night’s meeting, Hauschild introduced the concept to the members of the Fort Pierre City Council.
“There is in state law a provision to where any two subdivisions of governments can form a regional rail authority. What that basically becomes is an entity that can do all the business of working on railroads,” he said.
If completed, the proposed upgrade would allow DM&E to transport coal from Wyoming through South Dakota and Minnesota into Wisconsin. Between 30 and 40 trains daily would be expected to run through Pierre and Fort Pierre, according to earlier reports.
The railroad project, which has been approved by the federal Surface Transportation Board, is currently mired in lawsuits. Also, the company has not obtained financing for the multi-billion dollar project.
Should those problems be resolved, local governmental entities will have issues of their own which may best be addressed with a regional rail authority, according to Hauschild. Among the issues are a bypass, rail sidings and crossings.
“We really don’t want to get behind the ball on this one,” Hauschild told council members.
Fort Pierre council members had no questions for Hauschild following his presentation. In a separate interview, Hauschild explained the benefits of a regional rail authority.
“It gives one legal entity to deal with DM&E and Congress and the state or whoever,” he said. “What they can do then is form a regional railroad plan.”
Currently Hughes County and the city of Harrold have a regional rail authority which was able to borrow money to build the extra track needed in Harrold for the birdseed plant, according to Hauschild. Pierre, Fort Pierre and Stanley County could join this authority or Fort Pierre and Stanley County could form their own.
Hauschild said he believes that joining the existing authority would have benefits.
“The issues we have here have a lot of commonalities. We have the same problems. We need to address them,” he said.
Currently, the DM&E plan does not include a bypass for Pierre and Fort Pierre although the track runs near schools in both communities, near government offices in both communities and along businesses in both communities. An agreement has been reached with DM&E in which DM&E would use a bypass if created and would apply the cost of upgrading existing track to the cost of building a bypass, according to earlier reports. However, the cost of the bypass is currently estimated at between $100 million and $125 million.
A regional rail authority could provide one voice for the separate governmental entities and be an asset in obtaining financing.
“If the bypass is something that they want to pursue, that gives the county and the city that option to act as a unit of government to pursue that option,” Hauschild said.
Should the cost be so high that money cannot be obtained through the state railroad trust fund, a regional rail authority could borrow the money with bonds, he said.
In addition, to meet the needs of local elevators and ag-related businesses, side tracks will need to be upgraded to handle heavier railroad cars if the rest of the line is upgraded, according to Hauschild. A regional rail authority could look at this.
“Those are the types of things that won’t be included in DM&E’s plan for upgrading. If they’re going to be included, somebody has to be there doing the engineering and everything,” Hauschild said.
If formed, the regional rail authority would consist of elected officials from the participating governmental entities and at least one citizen, he said. An executive director and staff could also be hired to address local issues. The cost would not be significantly greater than the cost of working independently, according to Hauschild.
Due to the impact that DM&E has on the region, this type of arrangement is worth looking at, he said.
“They’re a big economic factor, so we need – as an agricultural community and everything – we need to have DM&E, so this is just kind of looking down the road,” Hauschild said.