Posted: Friday, February 2, 2007 12:00 am
SIOUX FALLS, S.D. (AP) - A Federal Railroad Administration ruling announced Wednesday triggers a 90-day period during which the agency must approve or reject a requested $2.3 billion loan for the Dakota, Minnesota and Eastern Railroad's planned coal train project.
"The final decision will be made after thorough consideration of an extensive and independent evaluation of the railroad, the proposed project and the … loan application," the agency said in a release.
Meanwhile another federal agency, the Surface Transportation Board, says it will prepare a full environmental impact statement before it lets the DM&E haul coal over its sister line, the Iowa, Chicago and Eastern. That line gives the DM&E access to Chicago.
Kevin Schieffer, DM&E president, said STB the ruling is a hurdle the railroad expects to clear this year.
But a transportation economist, Frank Wilner, said a full-blown environmental impact statement could stretch into 2009.
"While the (board) said you can go ahead and construct the line, you can't run any coal trains until we complete an EIS. Any lender looking at that would be concerned," Wilner said.
Schieffer said he took comfort in a statement from Charles D. Nottingham, STB chairman.
Nottingham said the DM&E project "will significantly advance key national transportation and energy policy priorities. The decision to proceed immediately with an environmental impact statement allows the STB to meet federal environmental law requirements, protects the project from legal attack, and should ensure that the environmental review process is completed prior to the DM&E's planned commencement of PRB coal train traffic."
The FRA said it has determined the DM&E's project has met the requirements of the federal environmental review process. The release of the agency's final environmental review starts the time frame for the loan decision, according to the release.
"This is a very encouraging development with regard to the DM&E's proposed upgrade project through South Dakota," Gov. Mike Rounds said Thursday in a release.
The DM&E wants to add track to the Powder River Basin coal fields in Wyoming and upgrade its existing line in South Dakota and Minnesota. The $6 billion project would involve building about 280 miles of new track and upgrading 600 miles of existing track so trains could haul coal for power plants.
The agency said that if the loan is approved, it will require the Sioux Falls-based railroad to make additional safety improvements at 10 highway-grade rail crossings in South Dakota and Minnesota and require that locomotives used west of Huron meet or exceed federal emission standards to reduce air pollution in national park areas.
The agency considered nearly 2,500 public comments before reaching its conclusion, according to the release.
In a separate statement Wednesday, the Rochester Coalition in Minnesota said the ruling was not a surprise.
"We disagree with the FRA's environmental ruling, but it was not unexpected," said Chris Gade of the coalition. "The FRA's reliance on an incomplete and inadequate environmental review casts a cloud of doubt over the ruling."
The federal loan "can and should be stopped," Gade said.
The Mayo Clinic, Olmsted County, Minn., the city of Rochester and the Rochester Chamber of Commerce make up the Rochester Coalition that is fighting the project and wants DM&E to bypass Rochester.