MINNEAPOLIS — A federal judge has thrown out parts of a South Dakota law that could have blocked the $2 billion coal-train construction plan of the Dakota, Minnesota & Eastern Railroad (DM&E), reports the Minneapolis Star-Tribune.
The railroad, with headquarters in Brookings, S.D., plans to upgrade 600 miles of track in Minnesota and South Dakota and to build about 280 miles of new line, primarily to haul coal from Wyoming. The federal Surface Transportation Board approved the plan nearly a year ago.
The 1999 South Dakota law would have required that, before using eminent domain to acquire property for the project, the railroad would have had to show that the plan primarily would benefit South Dakota shippers and that all financing was in place. Those were “insurmountable” obstacles, the DM&E said.
The law, favored by Gov. William Janklow, also would have given free use of railroad right of way to other utilities and given a veto power to the governor. The DM&E filed suit in U.S. District Court in Sioux Falls to block it.
Lawrence Piersol, the court’s chief judge, ruled Friday that much of the law is either an unconstitutional burden on interstate commerce or is preempted by federal law. He permanently enjoined South Dakota from enforcing those provisions, narrowing the criteria that the governor — or his designees — can use in evaluating eminent-domain applications.
Piersol upheld parts of the law requiring the railroad to show that using eminent domain is a public necessity and that it has negotiated in good faith to aquire property without using that procedure.
The decision was “a home run” for the railroad, DM&E President Kevin Schieffer said in a statement Monday.