(Iowa Capital Dispatch Story Written by Joshua Haiar)
(South Dakota) A committee of state lawmakers advanced legislation Friday asking voters to put restrictions on eminent domain in the state constitution, after the measure’s supporters argued South Dakotans need stronger protections than the law banning eminent domain for carbon capture pipelines adopted last year.
Eminent domain is the power to take private property for public use, with just compensation to the landowner. Although eminent domain is often used for water pipelines, electrical transmission lines and other infrastructure, it’s been a divisive issue in South Dakota the last several years because of a proposed multi-state carbon capture pipeline that would pass through the eastern part of the state.
The Legislature’s House State Affairs Committee voted 10-3 on Friday at the Capitol in Pierre to send the new eminent domain resolution to the full House of Representatives. If passed by the House and Senate, the measure will go on the ballot for the November general election.
Rep. Spencer Gosch, R-Glenham, introduced the bill. He told lawmakers the resolution is meant to “revert the power of eminent domain authority to the government and public use only.” He said the current law allows eminent domain for “tax revenue and economic development,” and argued South Dakota should “revert it back to the way it was supposed to be.”
The constitutional amendment would add language to the state constitution that reads, “Eminent domain may not be exercised for the purpose of transferring private property to a non-governmental entity solely to promote economic development or increase tax revenue without the provision of a public use, purpose, or utility.”
Amanda Radke, who farms and ranches near Mitchell and opposes eminent domain for carbon pipelines, said the amendment would “eliminate the predatory practices of private companies who come to take things against the will of the people of South Dakota.”
“This isn’t a change to the constitution,” she said. “This is fortifying what the founding fathers intended when it came to property rights.”
Pacific Legal Foundation policy counsel Emily Amin, of Nashville, said property rights “mean very little if the government can override them whenever it believes a different private use might generate more tax revenue.”
Opponents, including water and electric utilities and various business groups, warned that the language is unclear and could trigger lawsuits and uncertainty for essential infrastructure projects.
Darla Pullman Rogers, representing rural electric cooperatives in the state, said changing the constitution could “inadvertently or indirectly affect our ability to exercise eminent domain,” raising questions about projects tied to economic development, such as electrical service for data centers.
Brett Koenecke, lobbying on behalf of investor-owned electric utilities, said the proposal is “confusing” and could “consign people to litigation to figure out what this means.” He said the clarity opponents were looking for would have to be sought in a courtroom through lawsuits.
South Dakota Chamber of Commerce and Industry CEO Ryan Budmayr said the current system works, calling the amendment “unnecessary,” arguing it “sends the wrong message” to businesses that South Dakota is not “open for opportunity.”
American Petroleum Institute Midwest Region Director Mike Karbo said the measure could hinder oil pipeline connections and jeopardize job creation and economic benefits.
Committee member Rep. Greg Jamison, R-Sioux Falls, asked if the amendment would bar eminent domain for running an electric or water line to a project that was built for economic development purposes.
Gosch said he believed it would not. He argued the resolution is “pretty clear” in seeking to ban eminent domain that’s solely “to promote economic development and increase tax revenue,” and he told the committee that approving the resolution does not amend the constitution.
“You’re simply saying, ‘I trust my voters, I’m gonna let them decide,’” Gosch said.
The proposed carbon capture pipeline through South Dakota is a project of Iowa-based Summit Carbon Solutions. The five-state pipeline would capture carbon dioxide from ethanol plants in South Dakota, North Dakota, Minnesota, Iowa and Nebraska and transport it to an underground sequestration site in North Dakota, to capitalize on federal tax credits incentivizing the prevention of heat-trapping gases into the atmosphere. The project has been granted permits in other states, but those have been subjected to legal challenges, and South Dakota regulators have twice denied permits for the project.
Landowner opposition to the project in South Dakota culminated in the Legislature’s passage of a law last year banning carbon pipelines from using eminent domain. Iowa’s House of Representatives sent a similar bill to the Iowa Senate this week.
