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DAVID KRUSE

By Staff | Jan 6, 2017

The Rock Island Clean Line withdrew its petition for a franchise from the Iowa Utilities Board to build a power line to carry current from wind turbines in the western Corn Belt region to consumers in metropolis Illinois.

With even more billion dollar investments being placed into wind farms in the region, the need to carry this power east to more populated areas will continue to grow. Someone, RICL or another entity, will attempt to fill this need, but with a reset moderating the original plan after meeting strong resistance from landowners, from which easements were required in Iowa.

RICL was unable to convince landowners to accept easement terms or gain approval from the IUB to use eminent domain power for the vast majority of the easements it needed. It reportedly obtained approximately 15 percent of easements needed voluntarily.

That was the very low hanging fruit and even many of those would not have consented had they not had the expectation of being forced to participate.

The debate over this project quickly changed from either you favored wind power or powerlines or not, to become a controversy over the reach of eminent domain power and when that power becomes abused.

RICL is a private company not a public utility. When does government have the right to intervene granting eminent domain power to one private entity over another? What we learned is that the IUB was not going to grant eminent domain power to RICL as it requested in order to force 85 percent of landowners to agree to their terms or be forced through the legal process to cede control of their land wrested from them for private use.

There is great activist resistance to the Dakota Access pipeline which also crossed Iowa to Illinois requiring easements, but DA relatively quickly acquired over 80 percent of the easements that it needed privately negotiated with landowners, a threshold that crossed over 90 percent by the time construction commenced.

When the vast majority of landowners “make their deals” with private entities then some use of eminent domain is appropriate to consummate the project for the public good.

The USA needs pipeline and powerline infrastructure for economic growth and even national security. Railroad and truck transportation is inefficient for these entities. I do not oppose wind power or energy distribution infrastructure.

I believe however, that landowners should be appropriately compensated with the deck not stacked against them by utilities boards. The primary difference between the level of resistance over the RICL and DA’s pipeline to landowners is, “What you can’t see doesn’t bother you so much.”

Ag practices such as crop spraying are not interfered with by pipelines, but are disrupted or stopped by powerlines which serve as obstacles to safe practices for aerial operations. This disrupts the use of farmland far and away larger than the footprint of the powerline.

The reason the pipeline proceeded as it did is because the vast majority of landowners voluntarily agreed to easements accepting the compensation offered. An NH3 pipeline crosses my land and other than having to accommodate for it in tile drainage systems, it is no big deal.

While there is always some grousing during construction, the pipeline is buried in the ground out of sight and in a few years the crops grown over it will be little impacted. The RICL transmission line, however, proposed monstrous towers that would loom over the landscape forever and, frankly, they offered less life of project compensation than for a wind turbine.

The Statue of Liberty is 150 feet tall, while a RICL tower was 200 feet tall. Imagine a row of oversized Statues of Liberties crossing the country-side. To get them via use of eminent domain would have been quite the opposite of liberty – more like tyranny.

Hence the debate over what constitutes eminent domain abuse.

I believe that it is inappropriate for eminent domain process to use farmland values to establish the value of easements for commercial projects. If a private company wanted to construct a motel on the edge of a town they would pay a commercial value for the property, not the farmland value.

Thus it is the same with pipelines and powerlines. These are commercial uses of the easements with far higher returns than for farmland, so eminent domain power is abused when used to lower the value of easements for what is commercial property to ag valuations.

I believe RICL easements were worth three times what they were willing to offer in ag valuations in commercial values, but they had hoped to wrest the easements from landowners at devalued rates by use of eminent domain. This would be an inappropriate abuse of eminent domain power for private gain.

Landowners agreed to private easements with DA fair and square, so they should be allowed to build that pipeline unimpeded with the process of law behind the company. President Obama abused his power to temporarily stop the pipeline in North Dakota.

My family and I have farmland that was in the route proposed by the RICL. I attended the first organizational meeting of what became the Preservation of Rural Iowa Alliance – landowners that opposed to RICL.

I quite frankly, was not very optimistic in their prospects for success for blocking RICL in the beginning, but I under-estimated some things, most of which was the sharp leadership and tenacity of the opposition organizers as well as the collective resolve of the landowners in opposition.

The opposition to DA contrarily hired ICCI to represent them, which was a joke. ICCI has its own twisted agenda and frankly were clueless, calling PRIA for advice.

Iowa landowners were always in control of their own destiny more than they realized. The IUB was never going to order eminent domain granting a private company the rights to force themselves on 85 percent of the landowners from which they needed private easements.

The vast majority of DA landowners on the other hand went with the easements voluntarily, so the project was approved. All of the rest is just noise.

I advised PRIA not to make this a referendum over powerlines, but instead focus on the rights of landowners relative to eminent domain. Large trailers were parked along U.S. Highway 20 with “Stop Eminent Domain Abuse” painted for the traffic to get the message.

A bill made it through the Iowa House setting a minimum number for the percentage of voluntary easements required for a project before the IUB could grant eminent domain power for them to acquire the rest. That provision was dropped in the Iowa Senate where there are members who represent commercial over private interests.

I believe that private companies should have to negotiate 90 percent of easements voluntarily before eminent domain power becomes eligible for IUB approval. The Iowa Senate put commercial interests over those of Iowa property owners in the past session.

Shame on them. Fiber optic cable companies have laid thousands of miles of cable crossing the country without use of eminent domain with all easements acquired by private negotiation, so the idea that private companies are somehow owed easements is bogus with opposite precedents.

RICL attempted to game the system with use of eminent domain and failed. This will not be over, however. The opportunity to transfer power from alternative energy to eastern consumers has not yet been met. RICL did not want to break the precedent of paying farmland values for easements and pay landowners the commercial value of easements.

It could have built its powerline if willing to pay commercial values for easements. They chose not to. I am sure that other power companies did not want to see that precedent broken either. That is why it needs to be defined by the Iowa legislature.

Some new entity will come back to try this again. Had RICL not withdrawn its petition in Iowa, it would have been barred by statute from doing so for five years. It has not withdrawn from Illinois where it has a Supreme Court case over qualification as a public utility pending.

RICL would have to start the state process over again in Iowa, but can come back at any time. I would assume that it, or some similar entity, propose a different plan using, a different route to avoid the PRIA.

The weakening of the farm economy would be in their favor.

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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