Foes of energy lines seek lawmakers’ help

Source: By William Petroski and Jason Noble, Des Moines Register • Posted: Monday, January 5, 2015

Oil Boom Shifts The Landscape Of Rural North Dakota

Some of the most substantial policy issues facing Iowa in the new year could be decided not by senators and representatives in the Legislature but by bureaucrats and regulators at state agencies.

That is, of course, unless lawmakers push their way into the conversation. And with just over a week before the House and Senate convene in Des Moines, it looks like they will.

A proposed oil pipeline and new wind-energy transmission line are among items to be considered by state agencies in 2015 but are controversial enough that lawmakers, lobbyists and advocacy groups are angling to make them a topic of discussion under the Capitol dome.

“From a policy standpoint, for us to kick this to a regulatory agency under a hopelessly archaic regulatory structure would be mindboggling,” said attorney and Republican power broker Doug Gross, whose law firm is representing land owners in the path of the oil pipeline.

“We fully would expect there to be a (legislative) debate on this this year,” he added. “There’s a lot of interest out there.”

The Dakota Access oil pipeline and the Rock Island Clean Line both are multibillion-dollar projects aimed at transporting new Midwestern energy resources to market: more than a half-million barrels of Bakken crude oil a day through the pipeline, and 3,500-megawatts of wind energy on the Clean Line’s overhead wires. Both could be reviewed and approved by the Iowa Utilities Board without input or influence from the Legislature.

“I’ve been here 33 years, and I’d say these are two of the biggest projects we’ve had in that time,” said Utilities Board Safety and Engineering Manager Don Stursma. “I especially love that they’re happening simultaneously.”

  Both projects are in relatively early stages of the approval process. The company seeking to build the oil pipeline just completed informational meetings across the state, and now must file the paperwork seeking a permit to build. That paperwork has already been filed for the Rock Island Clean Line.

Once permit applications are submitted, utility board staff will review the documents, and ultimately the three-member board will hold a hearing and issue a decision. The entire process follows no defined timeline and could take many months.

Eminent domain a hot-button aspect

But even with a lengthy approval process on the horizon and multiple opportunities for input, critics of the projects are uncomfortable with such big decisions being made by relatively unaccountable bureaucrats and appointees.

A top concern with both projects is the potential use of eminent domain, which allows a company to take private property for the public’s benefit in exchange for fair-market compensation.

State Rep. Bobby Kaufmann, R-Wilton, co-chairman of the Legislature’s Government Oversight Committee, said he can’t support using eminent domain for either project. But he’ll pursue legislation restricting its use only if the takings appear to be “rampant” across the project routes, he said.

The vast majority of easements for the projects should be acquired voluntarily from property owners, Kaufmann said. If they’re not, he’ll push to reroute the projects.

During the 2014 session, the House considered a bill pushed by opponents of the Rock Island Clean Line that would have required transmission line developers to draw up alternate routes if 5 percent of landowners in a proposed corridor were subject to eminent domain. The measure failed, but could be a starting point for bills in 2015.

Senate Judiciary Committee Chairman Robert Hogg, D-Cedar Rapids, said he, too, favors more state influence over where pipelines and power lines are constructed — and will back legislation granting it.

“I would like to see us have our state agencies be more actively involved rather than just react­ing to private companies’ decisions on pipeline and electrical transmission routes,” Hogg said. “It is a big deal when the state gives a company the right of eminent domain. That is something the Legislature is going to look at in 2015.”

Hogg, an ardent environmentalist, supports the Rock Island Clean Line but opposes the oil pipeline.

If the state is going to allow Bakken oil to pass under its farm fields, Hogg suggested requiring pipeline operators to provide adequate financial guarantees in case something goes wrong. Pipeline spills in other states have resulted in hundreds of millions of dollars of environmental damage, he said, and current Iowa law doesn’t provide enough protection.

Gross said his firm’s lobbyists will be representing a group called the Iowa Farmland Owners Association before lawmakers this year. They argue that because the pipeline is merely moving oil through the state while providing no benefit to Iowans, it shouldn’t be allowed to use eminent domain at all.

“It’s not generated here, it’s not produced here and it’s not consumed here. It’s just running through here,” Gross said of the oil the pipeline will transport. “To us, that’s not the basis for eminent domain.”

The group also wants legislation ensuring higher and ongoing payments for land used by the pipeline.

Companies seek voluntary easements

Pipeline developer Energy Transfer Partners is just beginning the process of securing voluntary easements from Iowa landowners, company spokeswoman Vicki Granado said, and views eminent domain as a final option.

Rock Island Clean Line project manager Beth Conley said her company likewise remains “absolutely” committed to winning voluntary easements from the vast majority of landowners within the Iowa corridor.

“This takes a long time. It is a very lengthy process,” Conley said. “Certainly there is no clock for us to begin condemnation procedures.”

Indeed, after nearly 18 months of negotiations with Iowa landowners, the power line project has won voluntary easements from only about 200 of 1,540 landowners, or 13 percent of properties within the proposed corridor, said Carolyn Sheridan, president of the Preservation of Rural Iowa Alliance, which is fighting the project.

Sheridan is among those looking for lawmakers to get involved.

“Our statewide organization, made up of landowners who are opposed to the use of eminent domain to take private property for economic gain, hopes the Legislature will take action to protect landowners in this state,” she said.

Environmental advocacy groups, too, are watching the measures closely, particularly the oil pipeline.

Iowa Citizens for Community Improvement policy director Adam Mason said the majority of landowners contacted by his organization strongly oppose the pipeline. The Iowa chapter of the Sierra Club also opposes the pipeline — and is keeping communications open with lawmakers. 

“There are some real issues for the Iowa Utilities Board,” said Wallace Taylor, an attorney for the Sierra Club from Cedar Rapids. “This is a project that is unprecedented in Iowa.”

‘No effect’ by low oil prices on project


    Despite a free-fall in crude oil prices globally, Dallas-based Energy Transfer Partners is going forward with plans for the Dakota Access project, a $3.78 billion pipeline to bring North Dakota crude oil across Iowa on a 1,134-mile route to Patoka, Ill., said Vicki Granado, a company spokeswoman. The drop in oil prices has “no effect” on the project, she said. The Dakota Access pipeline project is also known as the Bakken pipeline.
    Enterprise Products Partners, which had proposed a pipeline that would have transported crude oil from North Dakota to Cushing, Okla., announced Dec. 12 it was dropping its project amid the steep slide in crude oil prices. The proposed route did not include Iowa. Commitments from potential partners “were not sufficient to support the project,” Enterprise Products Partners said in a statement. Analysts told reporters the firm had appeared to lose a competitive battle with Energy Transfer Partners in bidding for contracts to transport crude oil from North Dakota’s Bakken oil fields.

These 4 issues could lure in lawmakers

Several contentious issues up for discussion in 2015 could be handled by state boards and agencies without any input from the Legislature. But lawmakers may find a way to get involved just the same. Four of the most prominent:

  1. Bakken oil pipeline
    THE ISSUE: A private company is looking to spend billions building a pipeline to bring crude oil to market from the Bakken fields of North Dakota.
    WHAT’S AT STAKE: The pipeline cuts across 18 Iowa counties and the private property of many Iowans. Approval would come only after a lengthy evaluation by the Iowa Utilities Board, but land owners, environmentalists and others already say lawmakers should step in.
    POSSIBLE LEGISLATION: Lawmakers and interest groups say they’re looking at legislation to restrict the taking of private property by eminent domain for the project and to ensure land owners get better compensation for their property.
  2. Rock Island Clean Line
    THE ISSUE: Developers are planning overhead wires spanning 16 Iowa counties to move electrical power generated by western Iowa wind turbines to eastern energy markets.
    WHAT’S AT STAKE: The Rock Island Clean Line would expand the market for renewable energy in Iowa, potentially enabling another $7 billion in wind-energy development. Like the Bakken oil pipeline, approval of the project rests with the Iowa Utilities Board. And, as with the pipeline, property owners are raising concerns about the use of eminent domain.
    POSSIBLE LEGISLATION: In 2014, lawmakers considered a bill requiring developers to propose alternate routes when a certain percentage of land in a given route was subject to eminent domain. Similar restrictions or alternatives to land-taking could be offered again.
  3. Cedar Rapids casino
    THE ISSUE: Leaders and developers in the Cedar Rapids area have been pressing for approval of a new casino in the city, but saw their application to the Iowa Racing and Gaming Commission rejected last year.
    WHAT’S AT STAKE: The commission rejected a $164 million casino proposal last April over concerns that it would cannibalize business from nearby casinos. Officials and developers, led by Cedar Rapids Mayor Ron Corbett, haven’t given up, and will be taking their case in 2015 to the Legislature.
    POSSIBLE LEGISLATION: The Corbett plan would create a new smoke-free casino license that would be used for the Cedar Rapids project. Additional provisions would increase payments to counties without casinos and eliminate taxes on certain casino revenues to make the new license more palatable to existing casino interests. The plan would also set a 10-year moratorium on new casino development.
  4. School start dates
    THE ISSUE: Current state law requires K-12 schools to begin their academic year in the week that includes Sept. 1. Waivers allowing early start dates have been virtually automatic, however, leading the vast majority of schools to open in August, some as early as Aug. 11.
    WHAT’S AT STAKE: The Iowa State Fair and other tourism interests have been pushing back against early start dates for years, arguing that they cut into family vacation time and diminish the industry’s labor pool. Late last year, the Department of Education announced it would establish criteria for granting waivers to the start date law, potentially making it more difficult for schools to begin classes early.
    POSSIBLE LEGISLATION: Key Democrats and Republicans alike have said they sympathize with schools’ desire for local control over start dates and want to review the existing law. A change in the law could nullify the department’s action and allow schools to set dates with less state oversight.

What is the Bakken pipeline?

The Bakken pipeline, officially known as the Dakota Access pipeline, would move up to 570,000 barrels of crude oil a day underground through 18 Iowa counties en route from the Bakken oil fields in North Dakota to a transfer area at Patoka, Ill., about 65 miles east of St. Louis.

The entire project is budgeted at $3.78 billion, of which $1 billion would be spent on the Iowa section of the line.

The proposed pipeline route runs through the following counties: Lyon, Sioux, O’Brien, Cherokee, Buena Vista, Sac, Calhoun, Webster, Boone, Story, Polk, Jasper, Mahaska, Keokuk, Wapello, Jefferson, Van Buren, Lee.

What is the Rock Island Clean Line?

The Rock Island Clean Line would deliver 3,500-megawatts of wind-generated electricity from northwest Iowa to Illinois and other states to the east using overhead transmission lines.

It would begin in O’Brien County in northwest Iowa and cut across 16 counties, crossing into Illinois just north of the Quad Cities. Construction of the 500-mile line across Iowa and Illinois is expected to cost $2 billion, and is projected to enable $7 billion in future wind energy development.

The line’s proposed path runs west to east through O’Brien, Clay, Palo Alto, Kossuth, Hancock, Wright, Franklin, Butler, Grundy, Black Hawk, Buchanan, Benton, Linn, Jones, Cedar and Scott counties. You can see the complete route at