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Bakken hearing nears completion; decision could be weeks away

Iowa's eminent domain decision is key issue

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A forthcoming decision by Iowa regulators is just one of the approvals needed across four states for a proposed 30-inch diameter crude oil pipeline, but may prove the biggest hurdle.

The Iowa Utilities Board is expected to conclude its hearing next week after 11 days of testimony, 80 witnesses and a public comment day that drew hundreds of people. The anticipated decision may not come until February, though.

“In my opinion, the Iowa utility commission and Iowa courts are going to be the biggest hurdle to getting the pipeline built,” said Chris Healy, a lawyer with Meierhenry Sargent LLP of Sioux Falls, S.D., who represents landowners on eminent domain settlements in the case.

The governor-appointed, three-person Iowa Utilities Board will not only rule on Texas-based Dakota Access LLC’s hazardous liquid permit to cross 346 miles of Iowa as part of the 1,134-mile Bakken pipeline, but also to what extent, if at all, to empower the developer to condemn private land in the path.

Dakota Access, which is seeking permission to build the pipeline from North Dakota through South Dakota and Iowa to a terminal in Illinois, did not return several messages seeking comment.

Iowa’s process for eminent domain, which will play a key role in how quickly the $3.8 billion pipeline if approved gets built, is different from other states.

Iowa could grant or deny the permit, and has a range of options for eminent domain — from all or none to some point in between.

“The board could also grant a permit and grant eminent domain, but limit the exercise of that power to the extent the board determines that is necessary,” said Don Tormey, Iowa Utilities Board spokesman.

In South Dakota and North Dakota, the utility commissions don’t rule on eminent domain.

South Dakota became the first state to approve the pipeline earlier this week when its Public Utility Commission granted permission by a 2-1 vote with some conditions for construction and land reclamation. Under South Dakota state code, utility companies, including pipelines, have the power of eminent domain as a common carrier, Healy said.

“Iowa’s system is better because it can judge on a case-by-case basis whether a specific project is worthy of the awesome power of eminent domain,” he said, noting Dakota Access has been condemning land in South Dakota well before the permit had been granted.

Illinois Commerce Commission’s deadline for a ruling is Dec. 22, but it could come during scheduled bench sessions on Dec. 9 or 16, said ICC spokesman Bob Gough. Illinois has similar authority to Iowa for considering eminent domain.

“In Illinois, they are asking for both the right to build the line itself and eminent domain,” said Jordan Walker, an eminent domain lawyer for Illinois-based Sever Storey law firm. “My anticipation is they will get both.”

The North Dakota Public Service Commission held initial hearings, but hasn’t set a timeline for ruling, said Patrick Fahn, director of compliance and competitive markets for the commission.

This summer, the Iowa Utilities Board had been suggesting a ruling may come in December or January, but the estimate has been pushed back.

Board members “have to go through all of the evidence that has been presented and all of the applicable Iowa law,” Tormey said. “They will take as much time as they need. Early February would be an estimation, but by no means is that an official date.”

The Iowa Utilities Board hearing began Nov. 12 with public comments, followed by evidentiary proceedings beginning Nov. 16. The end of the hearing was extended until at least Monday. The board has the discretion to extend the hearing as necessary, Tormey said.

The Iowa Department of Natural Resources has scheduled a public comment meeting for 5 to 7 p.m. Dec. 16 in the auditorium of the Wallace State Office Building in Des Moines to consider a request to install the pipeline across public lands and waters, including the Big Sioux River and the Nelson Tract of the Big Sioux River Complex Wildlife Management Area in Lyon County, the Des Moines River in Boone County and the Mississippi River in Lee County. The DNR hopes to rule this winter.

Three jurisdictions of the U.S. Army Corps will concurrently rule on a permit under the Clean Water Act for the pipeline to cross hundreds of rivers and streams. Dakota Access has yet to provide all the requested information related to impact on endangered species and cultural resources, in part because of trouble accessing land, said Donna Jones, chief of the Corps’ Illinois/Missouri Section Regulatory Branch.

As part of its endangered species review, the Corps will provide a biological assessment to U.S. Fish and Wildlife Services, which will have 120 days to issue an opinion. Jones said she did not have a timetable for a decision.

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