The Railroad and South Dakota

RRcrossingTo say the issue of rail roads in South Dakota is a complex subject is an understatement. It is an issue that our policy makers will have to address sooner or later (hopefully sooner) The railroad is supposed to be a public-private partnership. While serving our communities, by providing an inexpensive means of getting farm and other products to market; railroading companies also should be able make a profit. There are lot questions about railroading’s future in South Dakota. There are no easy answers, no silver bullets and no quick fixes. It is going to come right down to making some hard decisions, and suffering the consequences of those decisions.

In the past few years, there have been several news articles about high speed rail from Los Angeles to San Francisco,(The Hyperloop) and one from Victorville to Las Vegas and the federal government support for these projects. Meanwhile here in the Rushmore state, there are areas struggling to keep what rail service they do have. The railroad is slowly disappearing, and no one seems to notice, or if anyone does, they just don’t care.

A bit of History.
Okay, I know, it’s not exactly my favorite subject either. However, it helps understand some the issues.

Back in 1889, When South Dakota became a state, there was just under 900 miles of track.
In 1948, when the last track was laid, there was well over 4,000 miles of steel. Rail was essential for many of the smaller towns. They brought people, freight and ‘stuff’ to many smaller towns, They also took grain, livestock and other products to market. In the years that followed, highways had improved, and airplanes could move people in hours what used to take days on rail. The railroads shifted from passenger service to moving freight. The only passenger service offered was that which was require by law at the time.

During the 1970′s There were some major changes in railroading industry; Amtrak was formed and took over much of the passenger rail service. Many of the smaller railroad companies went bankrupt or were absorb by larger companies. Conrail was formed to help some of struggling freight lines on the east coast. Both Amtrak and Conrail were products of the federal government. Up until this point, the federal government had the railroad companies under its thumb, through over regulation and mandates, almost killing the industry as a whole. In 1980 the Staggers Rail Act was passed by congress, which for the most part deregulated the railroad companies. It allowed the railroads to reorganize, drop sparsely used lines, and return to profitability.

During The 1980′s Milwaukee Road embargo, South Dakota was faced with a loss of over ½ of it’s operational track. South Dakota Department of Transportation (DOT) evaluated every segment of track. Those lines that were deemed essential to the state’s economy, the state moved to find other companies to buy and operate those lines, where no buyer was found the state bought the line and ‘banked’ it for future use. It was out this plan that Dakota Minnesota & Eastern was born. Many smaller towns lost rail service. South Dakota came up with a State Highway Plan. In this plan, towns without rail service would be able to truck grain to towns that did. The SD DOT beefed up those highways with wider shoulders, wider turning radius, etc. to handle the increase truck traffic.

Today there is a mere 1,840 miles of operational rail line in South Dakota. The state still owns about 316 miles of the operational track. Of the 15 Railroad companies that once served South Dakota, there are now nine.

How Important is Railroads to South Dakota?

farm1In 2012 South Dakota farmers produced well over 800 million bushels of corn, soybeans and other grains. About 55% of that is exported on rail, according to United States Department of Agriculture (USDA) estimates. (I got this info before the site went dark)

From Governor Dennis Daugaard’s column Sept. 6, 2013

In part, the success of South Dakota’s agricultural development is owed to the industry’s ability to ship products to and from South Dakota via rail. Rail service allows South Dakota products to enter regional and global markets. When our products are shipped by rail, it saves money for producers and consumers. In order to keep the price of our products competitive, the shipping costs need to be competitive as well.

One important rail line in South Dakota is the old DM&E line, now owned by the Canadian Pacific. The line runs through many South Dakota cities and towns including Belle Fourche, Sturgis, Rapid City, Wall, Phillip, Midland, Pierre, Onida, Aberdeen, Huron, Watertown and Brookings. Around 80 to 90 million bushels of grain are shipped each year across the state on the Canadian Pacific rail line.

The American Association of Railroads has published a report indicating how much was exported and imported in and out of South Dakota.tableThe Association of American Railroads estimates it would take 7,200,000 additional trucks to move this amount of freight over the road. This doesn’t include any freight delivered intrastate.

They also published this report The interesting stuff is on page three.

chart1This is across the seven class I railroads, nationwide. As you can see, the of bulk of their freight and income is from coal. Agricultural products only make up just under 8% of the products shipped providing 7.8% of the total revenue. While the loss of Agricultural products would hurt, it is something the railroads could recover from.

“Not in My Backyard!”

Regardless how important rail is to South Dakota #1 industry there seems to be some very intense feelings against railroads and trains. The primary complaints are safety, noise and vibration, and they seem to scare people.

I like trains, really, just not real trains. They scare me.
-Kristine Webber, Sioux Falls Resident

Any time a railroad talks about expanding, or moving, sometimes within hours hours of the announcement, grass roots groups are formed to stop whatever the railroad is expanding.

entering rail yard
BNSF Entering The Sioux Falls Rail Yard

When Burlington Northern / Santa Fe was trying to move the Sioux Falls rail-yard to an area out side of town every site had people against it. They were saying, “Yes, move it, just not here.” When there was talking of adding a siding so locomotives can move to either end of the train, a lot of people showed up to up to oppose it. It seemed to them the best option was to leave the switch yard right where it’s at. Read that here

When Dakota Minnesota and Eastern was planning to expand their lines into the Wyoming’s Powder River Basin and start shipping coal to customers eastward, they realized they needed to upgrade their current rails to handle the weight, length and speed of the coal trains. Despite the obvious benefits, communities all along the line resisted. The Mayo Clinic in Rochester MN hired then former Congressman and Governor Bill Janklow as consultant to oppose the expansion. DM&E tried to work with many of the communities to allow the up grades to the existing rails for the coal trains, yet these grass roots groups still opposed any expansion, upgrades and some extreme cases they wanted the existing rails to be removed.

Back to the Sioux Falls rail yard. From the Sioux Falls Web site.

PIC_0240
Sioux Falls Rail Yard.
Photo Courtesy of Sarah Clark

The Rail Yard Redevelopment Project is moving forward. A key milestone in the project was reached last week when the draft Environmental Assessment and Section 4(f) Evaluation document was signed by state and federal officials.
“This is an exciting time for Sioux Falls when a large project like this is one step closer,” says Mark Cotter, Director of Public Works. “Our goal is that the City’s purchase of the rail yard from BNSF will be complete by the end of the year.”

The downtown rail yard occupies an area of Sioux Falls that has been identified as a central location for economic redevelopment. The purpose of the Rail Yard Redevelopment Project is to remove the yard tracks, while maintaining BNSF’s railroad operations, meeting applicable railroad design criteria and safety standards, and being feasible from an engineering and logistics standpoint.

The removal of the yard tracks will open up approximately ten acres of land downtown for future development. If the proposed alternative is approved, trains still will travel through the heart of Sioux Falls but will interchange in the northeast part of town instead.

It would seem before the ink was dry, that Sioux Falls was almost dancing the streets in joy over the removal of the rail-yard. To be fair, several Sioux Falls in town businesses will still serviced by rail, The city just gets the rail yard moved so they can develop that area of downtown.

The Rail way vs. The Highway

consider this chart that show the number of vehicles miles traveled vs the total number lane miles.Chart 2

The result has been increasing highway congestion. The Texas Transportation Institute reports that over the decade between 1993 and 2003, the cost of highway congestion in the nation’s urban areas increased from $39.4 billion to $63.1 billion, an increase of 60.2 percent. The U.S. DOT estimates that the cost of congestion across all modes of transportation could be three times as high—approaching $200 billion per year—if productivity losses, costs associated with cargo delays, and other economic impacts are included. These include losses accruing to auto drivers, freight carriers, businesses, consumers, and the general public. As the cost of highway congestion has increased, public policy-makers at all levels of government have started looking to the railroads to carry more freight to relieve truck and highway congestion, and to help conserve energy, reduce engine emissions, and improve safety. Shippers, too, have started looking to railroads to carry more longer-distance shipments, especially as the costs of truck fuel and labor have increased.

It is in this report here.
(warning: it is a LOT of really dry reading)

Now, out of The South Dakota Department of Transportation fact book 

Chart3Interstate highway maintenance cost about $9,800 per mile per year and other state highway cost about $5,900 per mile per year.

It also might be worth noting that a lion’s share of the bridges and box culverts in the state are quickly reaching end of life.

If we add an additional 7,200,000 trucks with over 28 million tons of freight, our roads are going to take a severe beating.

Because railroad companies own their rail, the cost to lay and maintain rail is consider proprietary, and are rather unwilling to share it with me. The numbers I have found generally indicate the cost to install new rail ranges from 500,000 per mile to 49,100,000,000 per mile, depending on the obstacles and the location. Maintenance costs is some where between $1,000 and $500,000 per mile per year, again depending on the location and current condition of the track itself. That doesn’t mean they are going to spend that much each year, just an average cost. Keep in mind the railroad is suppose to cover all these costs, and not rely on any tax revenue.

Wow! that is a lot to digest there. Here is some more to chew on.

According to the Burlington Northern Santa Fe press releases via their web site,
over the past two years they have committed over 8,000,000,000 to their capital improvement program. That sounds fantastic, or does it?

2012-
BNSF plans $61 million capital program in Iowa to maintain and expand rail capacity
BNSF Plans $86 Million Capital Program in North Dakota to Maintain and Expand Rail Capacity
BNSF Plans $100 Million Capital Program in Minnesota to Maintain and Expand Rail Capacity
BNSF plans $202 million capital program in Nebraska to maintain and expand rail capacity
BNSF Plans $60 Million Capital Program in Wyoming to Maintain and Improve Rail Capacity
and
BNSF Plans $30 Million Capital Program in South Dakota to Maintain and Expand Rail Capacity

They will make that up the next year, right?

2013-
BNSF Plans $95 Million Capital Program in Minnesota to Improve and Expand Rail Capacity
BNSF Plans $110 Million Capital Program in Nebraska to Improve and Expand Rail Capacity
BNSF Plans $220 Million Capital Program in North Dakota to Improve and Expand Rail Capacity

There is still some time left for this year.

Burlington Northern/Santa Fe did not respond to any questions either by E-mail or by phone.  They just responded with various links.

So much for Burlington Northern / Santa Fe Let’s move on to Canadian Pacific, which owns and operates the only East-West rail way in the state-

When Canadian Pacific bought out Dakota Minnesota & Eastern in October 2008, They were all set to continue the Dakota Minnesota & Eastern plans for upgrading and expansion into Power River Basin.

From Christine Brown at Canadian Pacific:

In December, 2012, Canadian Pacific announced to defer indefinitely plans to extend its rail network into the Powder River Basin coal mines. There has been no change in this decision.

Here is that press release:

On August 8th The Governor’s releases this statement

“I am asking the Surface Transportation Board to determine whether or not the Canadian Pacific has met its obligations to the people of South Dakota,” Gov. Daugaard said. “This examination is imperative because past support for the Canadian Pacific’s purchase was based chiefly on promises it made to the STB.”

The petition serves as an official inquiry with the STB to determine if the CP lived up to the representations it made while seeking to acquire the DM&E. The Governor has asked the state Attorney General’s Office to assist in filing the petition.

uh-oh, Looks like CP is reneging on their deal.

Now Christine Brown from Canadian Pacific tells me:

At the time Canadian Pacific (CP) was in the process of acquiring the former DM&E it committed approximately $300 million in improvement and replacement capital.  In fact, from 2008 through July 2013, CP has invested more than $400 million to improve the safety and efficiency of the former DM&E network.

Yet, even with all those improvements, the CP Christmas Holiday Train still did not come to South Dakota last year.

I hope I am not the only one to catch the corporate double speak in that statement. ‘Safety and efficiency’ is not the same as ‘improvement and replacement.’ They are related, but not the same.

Now it is rumored that CP might sell its 660 mile line in South Dakota.

from CP spokesperson Christine Brown again:

CP is currently reviewing a 660-mile section of its 2,500-mile Midwest Network.  No decisions have been made as the process continues.  It should be made clear if a decision was made to sell the 660-mile stretch, it would only be with a party that can provide quality service to shippers and grow the business.  Again, no decisions have been made as the process continues.

I am going add a bit more, when the Milwaukee Road Railroad went in to their death spiral, much of track in South Dakota went into break/fix mode and sometimes not even that. Maintenance on the lines was deferred. DM&E started to rehabilitate the track, east river, and was in the process of asking for a loan to finish the project when they were bought out by CP. It is a good bet that there are segments of track that hasn’t seen much in the way of real maintenance since 1970′s or possibly even later than the 1960′s.

This part of the story is still developing…..stay tuned.

Heading south, the rail line from Napa Junction to Platte all but done. The last locomotive to use that rail was a single unit that traveled to Tabor, spent the night then then back to Napa Junction, north of Yankton. Just to show the line could be used. That was about ten years ago. Most of the line is still there, however it needs a little TLC ( okay, a lot of TLC) However, there might be a chance. An ethanol plant, east of Wagner, was looking at upgrading the line, but didn’t come up with the money. The state was going to sell the line for $1,500,000, and estimates it would cost $30,000,000 to 50,000,000 to rehabilitate the rails. That single locomotive? It went up to Aberdeen to spread ballast on the Britton line rehab project. It is now stranded in Aberdeen, broken down.

There are many more examples. Bottom line, while railroad can make an small profit with moving grain, they can’t make enough to justify the cost of laying new rail or even really keep up the rail they already have. The Railroad needs something else besides grain, to make it worthwhile.

Bruce Lindholm at the Department of Transportation told me the best way to improve the rail system is to get businesses to locate next to a rail and then use it.

There are plenty of places that companies locate, and have good access to rail. However, businesses can locate almost anywhere, have and door to door service by truck. Investing in private rail is a long term commitment. Before any rail is laid to a facility, that facility needs to commit to be around for awhile either accepting and producing some kind of freight. In today’s economy getting such a commitment is almost impossible. If the railroading companies what a (larger) piece of the transportation pie in South Dakota, they are going to have to (really, really) step up their game. What worked in the late 1900′s, won’t work today.

ellis&eastern
Ellis & Eastern @ La Mesa in Sioux Falls.
To Eastern – Not to bad
To Ellis – Not so much
Photos Courtesy of Sarah Clark

What do our elected officials have to say about all this?

From Repsentitave Mike Verchio, ( R )Dist. 30 Chairman of the House Transportation Committee

As I understand the finding of the Surface Transportation Board during the purchase of the DM&E lines CP promised to do approximately $300 million in upgrades to the rail beds & rails . To date they have not documented those improvements . Those were conditions of the purchase . As far as aspirations for rail service in South Dakota we would like more & better service , solid track , decent train speeds & no restrictions on inter changes . That means no paper barriers such as restrictions on the types of commodities carried & let others use existing connections without large fees & various other prohibitions .

From Governor Dennis Daugaard’s column Sept. 6, 2013

Daugaard
Gov. Dennis Daugaard

When the Canadian Pacific purchased the line from the DM&E in 2008, it promised more efficient service, more competitive shipping options and the investment of hundreds of millions of dollars in the line. At the time, the people of South Dakota relied upon these promises and supported the acquisition.Last December, the Canadian Pacific Railway announced that it may sell the portion of the DM&E line that runs from Tracy, Minnesota to Colony, Wyoming, including the entire line in South Dakota. When I learned of CP’s intentions to sell the line, I reached out to the company’s president to verify that the company had kept its initial promises for investment in improvements. Unfortunately, my request went largely unanswered.  Consequently, I felt compelled to file a petition, on behalf of South Dakota, with the federal Surface Transportation Board, asking these same questions.

This week I am traveling to Washington, D.C. to encourage federal officials to get to the bottom of this. South Dakotans deserve to know whether CP kept its promises. This line is too important to the farmers and ranchers – and to all people in our state – for these questions to go unanswered.

The most telling came from my own State Representative Steve Hickey ( R ) Dist. 9 and member of the Transportation Committee.

Railroads in SD are not an issue that is on my radar or that I’m versed in.

 

 

 

The railroads are quietly slipping away. A little bit at a time. It won’t be too long before Railroads in South Dakota are the stuff of legends. The people that once rode the train will now drive themselves, take the bus or fly. The freight that once traveled from the small towns to the markets on rail, will be moved by trucks.
Since we have an election coming up, I also asked some of the candidates:

Gubernatorial Candidate Lora Hubbel:

hubbelMy emphasis would be to have as much as possible in private hands…..that being said rail is infrastructure. Utilities and infrastructure are the only times we should use Public Private Partnerships. The rails need fixed and if we can “find” $8 million in the budget, Im sure can come to some sort of way to fix the rails. Until we know how much CP in indebted to the rail we don’t know how much we need to come up with. But I assure you I will not hire my brother, sister, cousin-in-law to reap the benefits of fixing the rail lines.

Gubernatorial Candidate Mike Myers:

MMyersI am not completely versed on the issues regarding the railroad. I support a strong freight based system. I also support Governor Dauaard’s efforts to hold Canadian Pacific to its obligations

 

Your turn.

This is one of those ‘slow burn’ topics, that builds up over time. Politically speaking, this isn’t an sexy issue, it’s ugly, with deep rooted feelings on all sides.

Everyone I spoke with are saying, South Dakota needs a strong, vibrant rail system. No one is saying how do we get there from where we are now.

The readers of the South Dakota War College are some of the most well informed, and innovated thinkers in the state. I stated before there are no quick fixes or easy answers, but we don’t shy away from something because it’s hard, we tackle it, we wrestle with it, then we own it. Now it’s your turn, dedicated reader (if you gotten this far, you surely are); What should we do, if anything about South Dakota’s Railroads?

28 thoughts on “The Railroad and South Dakota”

  1. Mr. Nelson just robo-called me with a poll. They spewed a phone number faster than this old mind could register it and then asked a question, which said “if the election were held today would you vote for ‘conservative’ Stace Nelson or ‘moderate’ Mike Round.”

    No mention of Mr. Rhoden or Dr. Bos, only those two items with Stace’s adjectives applied. If you pick the non-Stace option the poll hangs up on you, so be sure to pick the pro-Stace options to keep on the line for more entertainment and to skew the results. (I often claim to be a 21-yr-old black female making $100K a year just to entertain these poll people. You should too.)

    Let’s keep this on topic. -MC

    1. We should have a topic on this, but there were no other posts here related to Rounds or Nelson or robo-dialing. I would be obliged if you moved my post to a more relevant place Mr. MC as I cannot.

  2. I just got the same call with the same hangup after I chose Rounds.

    No doubt this is a half-baked Nelson/John Bircher strategy to try to produce big poll numbers for Stace.

  3. A couple historical notes from an old railroad aide to Sen Adbnor.
    The state didn’t have the funds in the Janklow deal to buy the main line. Sen Abdnor got that funded by working with the Reagan White House. It has proven to be the most valuable piece of the line that was salvaged, because the coal traffic to Big Stone supported the rehab – that created the grain facility oportunities (lke the new one in Day County).

    The pasenger train we ran on it in 1981 while putting the deal together, pre rehab, was only able to go about 15 miles for hour, and the rocking made you sick.

    You refered to the historical line as the DM&E, but the line was actually the C&NW, later becoming the DM&E.

    The C&NW had been in bankruptcy, like the Milwaukee. Unlike the BN, they weren’t land grant railroads, so they lacked the western real estate (timber interests) to subsidize their rail operations.

    The challenge that the C&NW could never overcome, and an Argus article a few months ago described the problem as still existing, are the (my recollection) 165 bridges on the line where it follows the Bad River through western South Dakota. The C&NW never had the resources to get past that challenge. I don’t thnk the DME could either.

    Hasn’t been my job for 32 years, but there’s a few extra background facts.

    1. Lee you are right. The C&NW never adequately dealt with the biggest issue on this line: the railbed. The DM&E knew that in order to improve the line they needed a new railbed under newer heavier rail. The “gumbo soil” in the central region of the state was a big problem for a railbed that had been built by human and horse drawn labor. Of all the new technological advances in the railroad industry, the advances in earthmoving would’ve made a newer, stronger, more stable railbed that would allow heavier, faster, and longer trains making the line more profitable. Not to mention the fact that with modern seed and hybrid advances available to producers, more and more corn and soybeans are grown farther and farther north and west in our great state. How will we get those commodities to market? Our state made the right decision to buy the lines in 1980. Pressler and his staff made a great move by saving the C&NW line in South Dakota. But we let our rail lines go for quick cash and now we are getting set to let go again. Farm products, coal, and North Dakota oil, I’d like to have this 1980 decision back.

        1. First, we get a hold of the former DM&E line along with the Colony Line in the Black Hills. I’d hate to say it but a public/private venture would be the best way to go about that, ensuring of course that ownership remain with the state as long as possible. How much of the line is available? Would access to Chicago still be available at a price that doesn’t kill the deal? Second, get our State government and the public behind behind this deal. The price for purchasing and rehabbing the track will never get cheaper if we wait much longer. Third, add value to the line by connecting it with the D&I rail line from Dell Rapids to Brookings or another connector line. Competiton in the market place is the great equalizer. Hypothetically, if the D&I could take trains down to Sioux City and connect with the UP or the CN, then Chicago is in play again. Options are what we need to make competition in the marketplace. From an interested outsider’s perspective That may be a start.

          1. While I am not opposed to a bond or loan, however, the rail needs something more.

            Maybe a couple of some kind of ‘small’ inter-module (container) centers?

            1. I agree. Problem is the “not in my backyard” arguement will then surface along with it’s cousin phrases: “we’ve never needed that before” or “this is just South Dakota, we don’t need to try new things.”

              1. This is were our ‘leaders’ should step up and educate the communities.

                It is going to be a tough sell, however, with the right backing it just might work.

                What we don’t want is another boondoggle like Amtrak, with state ran rail company

  4. Steve Hickey, when you typed this as a response: ‘Railroads in SD are not an issue that is on my radar or that I’m versed in,’ you should have stopped right there.

    ‘The railroads are quietly slipping away. A little bit at a time. It won’t be too long before Railroads in South Dakota are the stuff of legends.’ This already happened in the late 1970s and early 1980s. When the Milwaukee Road abandoned its lines in SD, former Gov. Bill Janklow led the drive to purchase those lines and lease them to a railroad. What was known only as Burlington Northern in the early 80s was chosen to operate its trains from Sioux City to Aberdeen, the Sioux Falls to Canton to Mitchell line and the line that traverses across northern SD from Appleton, MN to Aberdeen to Miles City, MT. The BN exercised its option to purchase the line from Appleton to Miles City in the early 90s. In 2005-2006, what is now known as BNSF exercised its option to purchase the Aberdeen to Mitchell to Sioux City line and the SF to Canton to Mitchell line. BNSF has also replaced most of the rail on the purchased lines with continuous welded rail so trains can travel up to 40 mph. BNSF is also upgrading the rail on its Appleton to Aberdeen to Miles City line. A railroad planning on discontinuing service would not replace rail at its own expense. The state-owned line from Mitchell to Chamberlain was rehabilitated in 2012 with stronger rail. Trains operated by the Dakota Southern Railway can now operate at speeds up to 25 mph. So, no the railroads are not ‘quietly slipping away.’

    ‘The people that once rode the train will now drive themselves, take the bus or fly. The freight that once traveled from the small towns to the markets on rail, will be moved by trucks.’ Did you just walk in the door from the early 1900s? It’s been more than 40 years since the last passenger train departed this state. And freight traveling on highways in trucks started happening a long, long time ago. Now, many interstate trucking companies put their trailers on flat cars, haul them cross country on trains for delivery in other markets. It’s much cheaper and economical to ship by rail.

    Please, Mr. Hickey, the next time someone asks you to comment on a topic in which you admit you know nothing about, just say ‘No comment.’

    As for the CP, I believe the major issue for that railroad is rehabing the Pierre to Rapid City line. The rail is very old and light weight. The Federal Rail Administration placed restrictions on parts or most of the line that do not allow trains to travel faster than 10 mph. It would cost CP millions and millions of dollars to replace all the rail, ties and ballast, and fix parts of the road bed from Pierre all the way to Rapid City. They obviously don’t want to bear that burden but they purchased the DM&E. They should be required to fix it before they sell it.

    He did stop. The formatting may make it seem like he said more. -MC

      1. Okay I tweaked it a bit.
        It looked should much better in my KDE KWord :/
        I am also finding out there is something here that doesn’t like tables too well.

  5. Many many reasons the DME coal project didn’t work, but politics was the main reason. UP and BNSF fought hard but quietly in DC to ensure that it would be a long and expensive undertaking. Obama in 2008 campaign said that his goal was to bankrupt the coal industry and he nearly has. More locally, Bill Janklow went out of his way to try to ensure that Scheifer’s and Pressler’s DM&E stalled, bankrupted, and went out of business. After Janklow pushed buying the Milwaukee lines he said no to saving the C&NW line. Pressure and Schiefer pulled that off and Janklow never forgot. His personal interests out-weighed the economics of our state in this case and he worked against the coal expansion project and against a large South Dakota corporation and we lost jobs with the sale of DM&E to CP. DM&E also had a line less than 40 miles away from Canton that could’ve brought SE SoDak ag products to Chicago, the Great Lakes and ST Lawrence Seaway to other markets. That 40 mile link could’ve been financed by the DM&E’s Powder River Coal Line Driving shipping prices down by competing RRs and opening new markets to our farmers. Politics. Nothing more than politics.

  6. Living in the southwest part of the state lends my self well to an opinion about RR. The BN runs through our part of the territory as well as the DM&E meets in the same general area and there is no mandates/encouragement for them to work together at all. Kinda like plane service out of Pierre no which way you go service sucks. West coast would be great place to market the grains, but SD people don’t want coal hauled the other direction because it might be on a train that goes to fast. You can’t haul freight only one direction and expect it to be profitable Good luck with the RR system, but I just see a old RR bed for pheasant hunting

  7. Two comments:

    1) Be easy on MC on formatting. We are amateurs and what we use to write it and then upload causes significant formatting issues. I have spent evenings trying to figure it out. WordPress definitely hates spreadsheets/tables as far as I can figure out.

    2) Absolutely fantastic article. South Dakota has traditionally been pretty forward thinking regarding railroads as we understand how critical they are for a rural state (grain out, goods in). If those items got transported onto our highways, we would have broken down roads. In my mind, we have to treat rail beds as a common good like highways. It is cheaper (lower transportation and maintenance costs) than using highways (a common good). However, when DM&E proposed its improvement project, we had a knee-jerk ideological response (crony capitalism) which pushed the DM&E into foreign hands who had no real incentive in the well-being of the economy of South Dakota. It was foolish.

    Now, we have to start consider most drastic action. Without being nearly as informed as MC, my first blush is we may have to entertain something similar to what Janklow/Abdnor/Pressler/Reagan did with the mainline. My thought is to help engineer a new “DM&E” to buy back the track. The State/Federal government put together a financing package for rehabilitation of the track. The new owner then repays the State/Feds over time based on miles traveled.

    As I once served as the Director of Finance in GOED and have intimate knowledge of the different bonding authorities of the state, this all is doable.

    We blew it when we opposed the DM&E loan (Daschle proved to me he was not a South Dakotan in leading that charge as it transcended all good he may have done in his career). Now we have to step up in a bigger way. It will take some education and communication to the public to re-educate them on how critical rail traffic is for South Dakota.

    If we do nothing, the migration from the non-metro areas will be huge. In 30 years, we will be 600,000 people with 450,000 living within 100 miles of Sioux Falls and Rapid City. Aberdeen, Watertown, Huron, and Mitchell will not total 50,000 and most of the towns between will be ghost towns.

    1. ‘Absolutely fantastic article.’

      I think it’s a good article that shines an important light on CP’s attempt to sell its lines in South Dakota. I would not go as far as to say it’s a fantastic article. It’s unfair to lump all the railroads serving SD in one bucket and claim they are ‘slowly slipping away.’ That is just not true. BNSF operates two very busy lines in the state serving ethanol plants, large grain elevators, a coal-burning power plant near Milbank and other industries. It purchased the ‘Core Lines’ in 2006 which indicates the BNSF has no plans to slip away.

      Gov. Daugaard has taken a step in the right direction concerning the CP and its SD line by going to the Surface Transportation Board and asking it to determine if the CP has spent the money it promised fixing DM&E’s line in western SD. I don’t believe it has spent enough in SD to fix that line. Check out this recent photo near Ft. Pierre. Any buyer of the that line will spend a lot of money fixing it. http://www.flickr.com/photos/29578505@N03/9731630314/

      1. To be honest, I wanted to get BNSF side of the story, or some idea of any expansion into South Dakota. The most I got from them was a link.
        If they want to present some kind of statement, and/or pictures, I’d happy to present their position.

        1. So, how’s your ‘story’ working out for you? Railroads gone yet? No? Shocking. Here’s something for you to chew on. http://www.mitchellrepublic.com/content/new-rail-carrier-service-gavilon-liberty-grain-facility

          Oh, and the CP Holiday Train made an appearance in SD this year: Brookings and Huron. Doesn’t have to come here every year. BNSF isn’t required to explain to you their ‘position’. Especially when you’ve demonstrated that your ‘story’ is full of inaccurate information.

          1. BNSF doesn’t have to explain anything to me. They only have to show they are following the law and making money for their shareholders.

            Because they are a major railroad in this state, I sought out a comment or statement. It seems only fair. However just because I request something doesn’t mean I’ll get it.

            You are correct the CP Holiday Train did stop in South Dakota.

            Even with all of that, rail service in South Dakota is lacking. WE are all going to pay the price in higher taxes to fix our roads.

  8. You can find information about BNSF’s financial performance its website if you are so concerned for the shareholders. As for following laws, can you name the specific laws you are worried about? Remember, these would be federal laws. States have no authority over railroads. It’s interesting how you’ve diverged from railroads disappearing to making sure they follow laws. But I can understand the delfection.

    http://my605.com/pierrereview/

    And I’ve provided a link to some more data that debunks your inaccurate conclusion that railroads are ‘quietly slipping away.’ And what a coincidence that as I type this, I can hear in the distance the horn of an approaching BNSF train. One of many that have traversed through Mitchell so far today since midnight. It will pass another waiting train parked in the siding about three blocks from my house. It will continue its way north once the approaching train has passed. I love the sound of trains rumbling in and out of the city at all hours. :) It’s a pleasant reminder to how woefully misinformed you are.

    1. One addendum: it seems you are now suddenly concerned about the roads and highways in this state. Maintaining and rehabilitating them falls on the Legislature to provide funding. While I appreciate and support Mr. Vehle’s effort to secure funding, it seems that some in the Legislature are fixated more on banning things rather than supporting vital infrastructure.

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