Carbon pipeline eminent domain ban advances to SD House; ‘compromise' bill gutted

Yahoo

03-03-2025

Supporters of House Bill 1052 dressed in yellow fill the South Dakota Senate State Affairs room before a committee hearing on March 3, 2025. (Makenzie Huber/South Dakota Searchlight)
PIERRE — South Dakota Senate Majority Leader Jim Mehlhaff – and a carbon dioxide pipeline proposal – took a political beating Monday morning at the Capitol.
The Pierre Republican watched the House State Affairs committee reject his legislation, which he described as a 'compromise' on eminent domain use for pipelines, only to have the same committee revive the bill and amend it into an anti-eminent domain measure.
An hour later, more than 150 opponents of a controversial carbon pipeline murmured and laughed in agreement when he told the packed room he'd 'get run over' for opposing a ban on eminent domain for the project. A proposed ban advanced out of another legislative committee Monday.
'I'm going to stand tall all the way because I think it's a terrible piece of legislation,' Mehlhaff said of the ban in an interview with South Dakota Searchlight.
Summit Carbon Solutions isn't named in the legislation, but it came in response to the Iowa company's proposed $9 billion, five-state pipeline that would pass through eastern South Dakota. It would collect carbon dioxide emitted by more than 50 ethanol plants and transport it for underground storage in North Dakota, to capitalize on federal tax credits incentivizing the prevention of heat-trapping emissions into the atmosphere.
Mehlhaff was one of two votes against House Bill 1052 in the Senate State Affairs Committee on Monday morning. Sen. Arch Beal, R-Sioux Falls, also voted against the legislation, which would prohibit eminent domain use for carbon pipelines. Seven other committee members voted for the bill, which will head to the Senate floor next. It's already passed the House of Representatives.
Eminent domain is a legal process for obtaining land access from unwilling landowners with just compensation determined by a court, for a project beneficial to the public — traditionally for projects such as electrical power lines, crude oil pipelines, water pipelines and highways.
A swarm of landowners clad in yellow testified in support of HB 1052, the latest in a string of bills targeting the carbon capture pipeline in the last several years. Sen. Mark Lapka, R-Leola, spoke as the prime sponsor for the bill. Lapka is a property owner, farmer and rancher. He said the bill wouldn't kill the project but would simply prohibit it from using eminent domain to pressure landowners.
'Should eminent domain be a tool in my toolbelt used to enrich myself for my own wellbeing?' Lapka said. 'I don't think so.'
Lapka and other critics of the Summit pipeline proposal view its potential use of eminent domain as a threat to private property rights. Pipeline opponents also have concerns about potential leaks, which could result in toxic carbon dioxide plumes.
Mehlhaff and other opponents of the legislation said it would be a 'kill shot' to the pipeline project and to the positive economic impact it would have on South Dakota, corn farmers and the ethanol industry.
Banning eminent domain for pipelines is 'the most important issue of the year,' said House Speaker Jon Hansen, R-Dell Rapids, when he suggested reviving and significantly amending Mehlhaff's Senate Bill 198 after the House State Affairs Committee voted unanimously to defeat the bill.
The original legislation would have retained eminent domain as an option, but required entities using it to first attend mediation with the affected landowner and to also have a Public Utilities Commission permit before commencing eminent domain proceedings.
The amended version of the bill duplicates the language of HB 1052, the bill banning eminent domain for carbon pipelines.
Hansen anticipates 'hostile, unfriendly' amendments to HB 1052 on the Senate floor. One amendment posted on the Legislative Research Council's website would ban eminent domain unless a project obtains a permit from the Public Utilities Commission and over two-thirds of easements needed for the pipeline route.
'I'd like to have an ace in the hole just in case things go off the rails over there,' Hansen said.
The amendment passed 9-4.
Rep. Tim Reisch, R-Howard, opposed the amendment and called it a 'bait and switch' maneuver, adding that Summit's eligibility to use eminent domain is being litigated in state courts.
'I think this is just underhanded,' Reisch said. 'This is not how we should be doing business in the people's house.'
The committee plans to reconsider the amended bill on Wednesday, after the Senate decides the fate of HB 1052.
Other bills challenging the pipeline project are still alive in the Legislature, including a proposed moratorium on carbon pipelines until the completion of new federal safety standards, and a bill that would authorize lawsuits by landowners who allege they've suffered from deception, fraud, harassment, intimidation or misrepresentation by a land agent for a carbon pipeline company.
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