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DAVID KRUSE

By Staff | Sep 19, 2014

U.S. transportation and energy infrastructure systems were often built with use of eminent domain.

The power to appropriate private property for purposes considered to be a public use was frankly, necessary in order to build the highways, bridges, pipelines and power transmission lines, ports and airports that commerce depends on today.

In Iowa, the authority to grant eminent domain power to infrastructure projects rests with the Iowa Utilities Board. Now if the state of Iowa was building a new road, the power of eminent domain to acquire the property is a given. What we are seeing, however, is private companies – seeking to build power transmission lines and oil pipelines – want public domain power to acquire needed easements through private property.

The Register quoted Rob Hillesland, a spokesman for the Iowa Utilities Board who said, “Companies planning pipeline projects have the right to ask the board to approve the use of eminent domain for parcels where they have been unable to secure voluntary easements. The board says it typically asks a utility to secure as many voluntary easements as possible before submitting a formal petition seeking the right of eminent domain.”

What is the clear definition of “the public interest?” Is it in the U.S. public interest to bring oil from Canada through the Keystone XL pipeline to U.S. refineries?

Is it to bring oil from the Bakken in North Dakota through a proposed pipeline to Illinois? Is it to move power through transmission lines from wind turbine farms in the western Corn Belt to Chicago consumers? Strong cases can be made that these ventures are in the public interest the same as all the pipelines and power transmission lines that have been built before them.

Opponents will tear into them with territorial arguments against them. It’s Canadian oil, there is no refinery in Iowa for Bakken oil, or the power from the Rock Island Clean Lines power transmission line will not be used in Iowa.

I find it absurd that infrastructure opponents narrowly define “public interest” so parochially even though clear public interest to the country exists.

I think that use of our own oil and renewable energy is compelling. That said, the right of private property is sacrosanct.

The IUB asks a utility to acquire as many voluntary easements as possible before submitting a request for eminent domain power.

If the utility can’t produce a large majority of voluntary easements, there is something wrong. Private companies need to make private deals as to acquire easements with landowners.

The RICL and the Texas company pipeline are commercial enterprises. They are going to make money, enormous sums from their projects yet they have arbitrarily decided what they will pay landowners for easement, refusing to negotiate.

The use they seek has nothing to do with growing crops. This is a commercial enterprise, and the land they need should have a commercial value transferred to the value of the easements, which, at a minimum, twice farmland values.

The Texas pipeline company is just starting its process of requirements to seek a franchise from the Iowa Utilities Board. The RICL effort is more advanced – expected to file by the end of the year. If they want to build this power transmission line and pipeline then make commercial deals.

The IUB should only get involved with eminent domain after 90 percent or more of easements have been acquired voluntarily. Anything less would give RICL license to deny landowners the real commercial value of the easements.

Unless RICL is under-reporting acquired voluntary easements to the IUB it had 131 of the 1,247 voluntary easements needed – about 10.5 percent.

No progress has been reported since late June. There were 1,117 objections filed against the RICL project which far exceeds the number of easements gained.

RICL may have acquired more easements that it has not reported. If it was having tremendous success in securing more voluntary easements, I think they would be sharing their joy.

The fact they are quiet likely suggests it is not going as well as it hoped.

It should be public knowledge as to the number of easements RICL has transacted and what the benchmark of voluntary easements RICL acquire.

I am not against pipelines or power lines. The country has to have them as a key component of economic growth. But, private companies should not be able to skate in under the radar as a guise of being a public service provider by use of eminent domain.

They are for-profit concerns and as such, need to acquire commercial agreements for easements. They are hoping the IUB does the work for them at half the market price by granting eminent domain power.

David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.

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