William Petroski

bpetrosk@dmreg.com

State utility regulators are wrestling with the fact that the owners of nearly 300 parcels of Iowa land have refused to voluntarily grant easements for the proposed Bakken oil pipeline, which would cross diagonally through 18 Iowa counties.

The Iowa Utilities Board met for nearly three hours Tuesday without reaching a decision on a request by Dakota Access LLC, for a state permit to build the 30-inch-diameter pipeline across 346 miles in Iowa. The board plans to resume deliberations Wednesday and is also scheduled to meet Thursday.

Dakota Access, a unit of Dallas-based Energy Transfer Partners, says it has voluntarily obtained signed easements for about 80 percent of the Iowa land parcels, which are primarily farmland. However, owners of the remaining 296 parcels could face condemnation proceedings if the pipeline is approved by state regulators who conclude eminent domain is justified under Iowa law.

Eminent domain is the right of a government to seize private property for public use, in exchange for payment of fair market value. But that definition is posing a legal worry for Iowa utility regulators that may ultimately be resolved by Iowa’s courts.

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“The issue here is: Is the Dakota Access pipeline a public use?” said Cecil Wright, the state board’s assistant general counsel.

Pipeline opponents argue the pipeline is not a public use because Dakota Access is a not a public utility and none of the oil will be refined in Iowa. Proponents say the pipeline will contribute to the nation’s energy independence, will provide a safe method of transportation and will help farmers by freeing up railroads to ship Midwest grain.

The pipeline would be used to transport up to 570,000 barrels of light sweet crude oil daily from North Dakota’s Bakken oil patch through South Dakota and Iowa to a distribution hub at Patoka, Illinois.

State regulators spent part of Tuesday examining electronic displays of Iowa county maps, looking at land parcels in Boone, Buena Vista and Calhoun counties where farmers have refused to sell their land. In some cases, farmers have suggested the pipeline route be relocated, including a northwest Iowa turkey producer who doesn’t want the pipeline to interfere with his operation’s expansion plans.

Wright told the board that some pipeline foes object to the diagonal path of the project’s route, particularly because it will interfere with farm tile drainage lines. Dakota Access has promised to repair any damage to tile lines, and the company says farmers will be able to raise crops on ground above the buried pipeline.

“The board will have to ask, 'Was there a better way to construct this pipeline with regards to Dakota Access and the diagonal route?'” Wright said.

Under the state’s administrative code, a pipeline project is allowed a construction deviation of 660 feet — one-eighth of a mile — from its proposed route. But David Lynch, the board’s general counsel, cautioned that a pipeline route can’t be moved onto land where a property owner hasn’t received legal notice, and regulators wouldn’t want to relocate the pipeline through a cemetery or school grounds.

Pam Mackey-Taylor, conservation chair for the Iowa chapter of the Sierra Club, said after Tuesday’s meetings she is concerned that no alternatives have been presented by Dakota Access for the pipeline route. So now the board is trying to resolve issues facing individual Iowa landowners who have objections and there is no way to relocate the pipeline this late in the process, she said.

MacKey-Taylor also said she doesn’t believe many landowners objecting to the pipeline route had a clear understanding that they needed to provide alternative routes on their land or elsewhere because the administrative proceedings involving the project have been so complex.