(Gazette News Services circulated the following story on January 4.)
SIOUX FALLS, S.D. — For former Dakota, Minnesota and Eastern Railroad President Kevin Schieffer, timing could have been everything.
A federal agency denied the DM&E a $2.3 billion loan two years ago. The money would have helped finance Schieffer’s dream of building track to the Wyoming c fields and fixing the remaining DM&E rail line to haul coal across South Dakota and southern Minnesota to eastern customers.
“Everything had lined up. We needed the financing to get it done, but somehow that last brick didn’t fall into place,” Schieffer said in an interview.
But if he had approached the federal government with a huge building project now, a new president promising big spending to jump-start the economy might have meant a different result.
Luther Miller of the Railway Age magazine says he thinks passenger railroads will grow under the Barack Obama administration.
“Someone like Schieffer, with a solid background in Washington and in railroads’ needs, could be working in that area as a consultant,” he said.
Schieffer, who was chief of staff to former Sen. Larry Pressler, said he’s not sure he wants to get back into railroads.
Last year, the DM&E was sold to the Canadian Pacific Railway for about $1.5 billion, with possibly another $1 billion in contingency payments.
Canadian Pacific has not formally revealed its intentions on the coal train project and seems content to weave the DM&E into its operations.
“It’s a natural fit. You’re talking about two companies whose service lines complement each other very much,” said CP spokesman Mike LoVecchio.
Schieffer said he left the DM&E in October after it became clear the expansion project was not a CP priority. The Canadian Pacific people who had an eye toward finishing it “had all been fired or reassigned,” Schieffer said.
He left the job a wealthy man but said he’d be “very happy to be a lot less liquid and building” the coal train project.
Schieffer, 50, said he plans to take at least a year to decide his next venture. His oldest daughter is in college, and he and his wife are raising a 9-month-old daughter.
Schieffer said he plans to open an office in Sioux Falls next month, “mostly as a place to putter around.”
Some who dealt with Schieffer on the coal train project point to an antagonistic relationship. “I always thought of him as being a politician in the railroad business rather than as a railroader,” said Larry Kaufman, a transportation writer and railroad consultant. “I did not think his building project worked.”
Rochester, Minn., City Council President Dennis Hanson said he and Schieffer “both started off on the wrong foot. It was very antagonistic from day one.”
Rochester interests fought Schieffer’s project, which would have had coal trains running through the southern Minnesota city.
Hanson did call Schieffer “a very sharp individual. If you could look back, and we could have gotten off on the right foot, you’ve got to wonder sometime where things would have led.”
Sen. John Thune, R-S.D., supported the project and has known Schieffer for years. Schieffer “is a person who wants to be in the mix. He wants to make things happen,” Thune said.
“I don’t think Kevin and railroads have seen their last days.”