Landowners concerned about property acquisition process for carbon sequestration pipeline

Editor's note: This is the second in a series of stories about a proposed Carbon Dioxide pipeline.

Many landowners have voiced their concerns over Iowa-based Summit Carbon Solution's proposed carbon sequestration pipeline. While safety is a main concern, it's not the only one: some landowners are raising questions over how the company is going about acquiring land, and who would be responsible for the pipeline, should anything go wrong.

Summit Carbon Solutions has applied for a permit with South Dakota’s Public Utilities Commission, the company announced earlier this week. The approval process for this permit takes about a year and includes opportunities for public comment.

If approved, Summit Carbon Solutions will be able to move forward with its plan to build a $4.5 billion carbon sequestration pipeline through South Dakota. The pipeline will also run through North Dakota, Minnesota, Nebraska and Iowa. The project has the goal of reducing carbon emissions at ethanol plants throughout the Midwest, allowing them to sell their product to states with low-carbon fuel standards like California and Oregon. Summit Carbon Solutions would split any profit with the ethanol plants and receive a tax credit, which could amount to as much as $600 million per year.

More: A carbon dioxide pipeline could be coming to South Dakota. Here's why landowners are concerned

Who is liable if the carbon dioxide pipeline ruptures?

Brian Jorde is an Omaha-based attorney with Domina Law Group. He represented a group of landowners who were fighting the Keystone XL pipeline. In a telephone interview with the American News, Jorde said, typically, if a landowner were to accidentally rupture the pipeline, they would be held responsible. Jorde said that he has seen his clients get sued for millions of dollars by pipeline companies due to accidental damage of pipelines.

But, after a meeting in McPherson County on Feb. 1, Jake Ketzner, Summit Carbon Solutions’ vice president of government and public affairs, said the company will always take responsibility for maintenance and liability. Federal regulations require annual inspections of the pipeline, he said, and line markers will help landowners know exactly where the pipeline is in case any work is being done on the property.

Property owners along the proposed route of the pipeline are currently being approached by Summit to sign easements that give the pipeline authority to cross that land, but company officials are also talking about using eminent domain to gain access as well.

At the McPherson County meeting, Summit Carbon Solutions Chief Operating Officer Jimmy Powell said he is confident that the company will be allowed to use eminent domain, meaning that landowners will have no choice regarding the pipeline being constructed on their property.

Once easements are signed, there's no going back

If property owners sign easements, they will receive a sum of money dependent on how much of their property would be used for the project. But, Jorde cautioned people against signing easements if they don't fully understand the project. Once someone signs an easement, there is little they can do if they change their mind.

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“You don’t get a redo. You don’t get to go to court. You don’t get to go through the condemnation process and start over. It’s over,” said Jorde.

Companies will also likely offer people a low sum of money to start, said Jorde. If people sign easements right away, they won’t be able to negotiate for a higher price.

Summit Carbon Solutions just applied for a permit through the Public Utilities Commission, and the process won’t likely be over for another year. When asked why people should sign an easement if the company doesn’t yet have a permit, Ketzner said the risk falls on the company.

“We’re confident that we’re going to get a permit,” said Ketzner. “But that’s because we’re doing all the steps that are needed to do that.”

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Ketzner added that landowners will get to keep the money that they are paid for signing the easement. But if Summit Carbon Solutions does not get a permit for the project, it would be able to sell the easement to the next pipeline company that comes along, according to Dakota Rural Action, a nonprofit grassroots organization, which has been working with landowners who oppose the project and is encouraging landowners to not sign easements.

Is eminent domain appropriate?

And while Summit Carbon Solutions is confident that it will get permission to use eminent domain, others aren’t so sure. The Takings Clause of the Fifth Amendment allows the government to take private property if property owners receive compensation. Eminent domain has historically been granted for projects that are for public use, with a classic example being the construction of the Interstate Highway System, said Jorde.

While Ketzner said the project will benefit everyone by improving the environment and the economy, Jorde isn’t sure that’s enough.

“Basically, if I sold my pickup truck and bought a Tesla, I should have eminent domain rights?” said Jorde.

Jorde is currently working with landowners in all five states that will be affected by the pipeline. He will help clients intervene into the proceeding, meaning his clients will go up against Summit Carbon Solutions applying for a permit. The Public Utilities Commission will essentially serve as a court and ultimately make a decision on the project.

South Dakota landowners hold meetings to educate and voice concerns

Landowners have organized multiple meetings over the last several weeks. Some, like Ed Fischbach and Mark Lapka, are using the opportunity to help educate people on the project and go over their specific concerns. Doug Sombke, who is the president of the South Dakota Farmers Union, said he was invited a meeting in Redfield and decided to attend to learn more about the project.

Sombke is concerned about the easements and eminent domain, and said that South Dakota's eminent domain laws are essentially nonexistent. That means that it almost never works out in the landowner's favor, he said.

Sombke said it might be a stretch to say that the pipeline project is a benefit for all of the public, which in practice would make it difficult for the company to get the right to eminent domain.

In the meantime, Sombke said he's supportive of counties placing moratoriums, as McPherson County did last week, so that the process is slowed down and new zoning ordinances can be put in place.

This article originally appeared on Aberdeen News: SD landowners concerned about carbon dioxide pipeline land acquisition