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Railroad rehab project still on track for grant

PIERRE -- Wheat Growers CEO Dale Locken told another group of South Dakota legislators Thursday about his company's plans if the state-owned railroad line that runs west from Chamberlain is rehabilitated.

He said the Aberdeen-based company will invest $40 million at Lyman for a grain loading and fertilizer distribution center once heavy rail reaches there from Chamberlain.

Wheat Growers has operations in 37 communities and 600 employees serving some 17,000 farmers, according to Locken.

"It gives quite an economic lift to those communities. We've seen that over and over again," he said.

A lot of senators and representatives seem very interested.

Rep. Don Haggar, R-Sioux Falls, said "a clear and compelling" argument was made for rehabilitating a once-busy line that now is out of service. Rep. Mark Mickelson, R-Sioux Falls, pronounced it "viable."

Championing the project is Sen. Mike Vehle, R-Mitchell. He is asking the Legislature for $6 million of state funding to help pay for the $20 million of rail work.

Opposing him are aides for Gov. Dennis Daugaard — and that's where this gets politically fascinating.

Daugaard has a railroad study under way involving a national consultant.

He also is seeking $1.2 million from the Legislature for rehabilitating the bridge over the Missouri River between Chamberlain and Oacoma.

The bridge is in solid shape, according to railroaders, but refurbishing is necessary if modern grain trains are going to run west of the river.

The bridge is one of two pieces key to Wheat Growers' plan. Farmers would gain 15 to 22 cents per bushel, depending upon whose figures are used, if they had to truck only as far as the proposed new terminal.

Consequently, with just one week left in the main run of the 2014 legislative session, much maneuvering took place during the past two days involving House and Senate members.

The Senate Appropriations Committee, which had voted 9-0 last month to endorse the $6 million for Vehle, delivered another show of strong support. The panel voted 9-0 Wednesday to added $6 million to the Daugaard bridge bill, bringing the total amount to $7.2 million.

The House Appropriations Committee meanwhile spent 90 minutes, an extraordinarily long time for a legislative hearing on a spending bill, listening to the Vehle plan Thursday.

His fellow legislator from Mitchell, Republican Rep. Lance Carson, is the House panel's vice chairman. Vehle had amended the bill down to $1 in the Senate. Carson kept the legislation moving forward Thursday at $38.

"It's a project we need to be looking at," Carson said.

Rep. Susan Wismer, D-Britton, warned that money spent for a railroad won't be available for other purposes. "This is a choice between education and healthcare or infrastructure," she said.

Steve Halverson, who farms in the Kennebec area, helped form a new group called Rails to the Future. He testified Thursday and spoke about the long view.

"It just makes sense," Halverson said. "This is an investment that is going to last generations."