Petitions filed to refer carbon pipeline law to ballot; Summit plans to reapply for SD permit

By Makenzie Huber

South Dakota voters might decide on Nov. 5 whether to reject a new state law regulating carbon dioxide pipelines.

The ballot measure committee known as the South Dakota Property Rights and Local Control Alliance submitted an estimated 28,000 petition signatures to the Secretary of State’s Office on Monday, said Jim Eschenbaum, chairman of the organization. The group needed signatures from 17,508 registered South Dakota voters by Tuesday’s deadline. The Secretary of State’s Office will now sample the signatures to determine if enough of them are valid.

The group aims to refer Senate Bill 201, which the Legislature and Gov. Kristi Noem approved last winter. Supporters said the legislation will implement new protections for local governments and landowners while providing a path forward for pipeline projects. Opponents view it as a capitulation to pipeline companies.

The bill came in response to an $8.5 billion pipeline proposed by Summit Carbon Solutions, which is headquartered in Iowa. The pipeline would collect carbon dioxide from 57 ethanol plants in South Dakota and neighboring states and pipe it to North Dakota for underground storage. The project could benefit from federal tax credits that incentivize carbon sequestration to fight climate change.

The Iowa Utilities Board approved Summit’s project Tuesday. The company announced shortly afterward that it plans to apply again for a permit in South Dakota next month, after its initial application was denied last year by the Public Utilities Commission. The company’s pipeline application in North Dakota is under consideration, and it still needs an underground storage permit in North Dakota.

The South Dakota denial was partly due to conflicts with county ordinances that require minimum distances known as “setbacks” between pipelines and other features. The project has also faced opposition from some landowners concerned about property rights and safety, including health risks associated with potential leaks.

Property rights were a factor in several Republican primary races in eastern South Dakota earlier this summer. Out of 14 incumbents who lost their seat, 11 of them voted for SB 201.

“I think people realize now that people are paying attention and maybe want representation in Pierre that won’t be sellouts to corporate America,” Eschenbaum said.

What the law says

Among the protections in the new law is authority for counties to collect a pipeline surcharge of up to $1 per linear foot, with at least half of the surcharge allocated for property tax relief for affected landowners. The remaining funds could be used at the county’s discretion. Companies also must submit an agricultural impact mitigation plan and bury pipelines at least 4 feet deep.

The law mandates public disclosure of modeling to gauge the impact of a pipeline rupture and ensures that pipeline companies, rather than landowners, are liable for damages caused by the projects.

In response to controversy about out-of-state contractors working for pipeline companies, the law says a land agent must be a pipeline facility employee, a resident of the state, or a real estate agent licensed in the state.

House Majority Leader Will Mortenson, R-Fort Pierre, was the prime sponsor of the bill in the House. The legislation provides additional property rights and money for farmers and counties, Mortenson said. He encouraged voters to support the law if it’s certified for the ballot.

“If you don’t think the pipeline should be held accountable, you should vote no. If you don’t think farmers deserve additional compensation, you should vote no. If you don’t think counties deserve additional compensation from these pipelines, you should vote no,” Mortenson said. “But if you want farmers protected and counties benefited if these pipelines are built, you should vote yes like the Legislature did and the governor approved.”

Setback language

The most controversial part of the new law is its language about the Public Utilities Commission and local setback laws. Prior state law allowed the commission to overrule counties’ pipeline setbacks, although the commission has so far declined to do that.

The new law says a permit from the commission automatically overrules local setback laws, unless the commission specifically chooses to uphold them.

“It took the voice away from county commissioners and gave it to three people in Pierre,” said Eschenbaum, who is a Hand County commissioner. “They basically say we’re not smart enough, that we don’t understand. I think it’s an awful precedent to set.”

Finally, the legislation codifies a “Landowner Bill of Rights” that includes references to rights in other South Dakota laws, including two other pipeline-related bills passed during the most recent legislative session.

If the law is referred to voters, it would join six other measures already approved to be on the ballot.

This story was originally published by South Dakota Searchlight, which is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. South Dakota Searchlight maintains editorial independence. Contact Editor Seth Tupper for questions: info@southdakotasearchlight.com. Follow South Dakota Searchlight on Facebook and X.