Iowa bill would block carbon pipeline developers from using eminent domain power for a year

Source: By Stephen Gruber-Miller, Des Moines Register • Posted: Thursday, May 19, 2022

Iowa lawmakers are seeking to block carbon pipeline developers from using eminent domain to secure land for their projects until next year.

House lawmakers introduced a bill Wednesday through an unusual maneuver — filing an amendment to an unrelated piece of legislation, replacing that proposal with language blocking any carbon pipelines from seeking or exercising eminent domain authority before March 1, 2023. Eminent domain powers would allow pipeline companies to condemn land needed to build their projects and to force unwilling landowners to sell easements at “fair market value.”

“Private property rights go both ways — for landowners that wish to do business with a pipeline and for those that don’t,” said Rep. Bobby Kaufmann, R-Wilton. “Our language allows negotiations with landowners by the pipeline to go on without interference, but ensures a level playing field so that landowners know that eminent domain is not a threat while we at the Legislature are gone.”

Three companies are proposing building pipelines across Iowa that would trap carbon emissions from ethanol and fertilizer plants and store them underground. Only one company, Summit Carbon Solutions, has so far applied to the Iowa Utilities Board for permission to build a hazardous-liquid pipeline. Summit’s request for a permit asks the board to grant it permission to use eminent domain.

The bill is the latest attempt by legislators to ease residents’ concerns about eminent domain, after previous tries sputtered out earlier this year. House Speaker Pat Grassley, R-New Hartford, said Wednesday he is supportive of the proposal because it would give some assurances to landowners that the Legislature is watching to make sure eminent domain isn’t abused, while also not interrupting voluntary deals between landowners and pipeline companies.

“I think we’ve been trying really hard to thread the needle,” he said.

Pipeline critics say eminent domain shouldn’t be used; companies say they’re seeking voluntary deals

Opponents of the pipelines are concerned that eminent domain could be used to force landowners to sell their property. Some have also said they’re worried about potential degradation of farmland. Summit’s $4.5 billion project is classified as a hazardous-liquid pipeline because carbon dioxide in high concentrations can cause illness and asphyxiations.

Ted Junker, a Grundy County resident who operates land in Butler County that would be crossed by one of the pipelines, said he doesn’t believe negotiators for the pipeline companies are operating in good faith.

He said if landowners decline an offer, “their comeback when you refuse them is they’re going to get it by eminent domain anyway.”

Junker said he supports the bill because it would remove the threat of eminent domain  as the pipeline companies seek easements from landowners.

“They’re making billions of dollars off it, OK?” he said. “They need to negotiate for the right. And it’s private property and they’re a private company. It’s not a public utility or it’s not for public convenience. It’s for them to make a lot of money out of, and that’s why they shouldn’t get eminent domain to do it, and they shouldn’t use that threat.”

Kaufmann said his intention is to take the threat of eminent domain off the table so landowners can negotiate in good faith with pipeline companies.

Kaufmann’s bill states that the Iowa Utilities Board shall not grant any requests for eminent domain and that a pipeline company shall not seek or exercise any eminent domain rights until March 1, 2023.

It could be months before the Iowa Utilities Board holds public hearings on Summit’s petition request and then issues its decision. Summit has said it anticipates receiving a decision in the first quarter of 2023.

Kaufmann said the bill intentionally would end the prohibition on the use of eminent domain next year so lawmakers would have a chance to review the companies’ progress on negotiating with landowners for voluntary easements.

“If they’ve achieved significant majority easements voluntarily, great, the project will go on. I support that,” he said. “But it gives landowners a certainty that eminent domain will not be hanging over their heads during the negotiations.”

Summit has said it’s reaching voluntary agreements with hundreds of Iowa landowners in the pipeline’s path. On Wednesday, the company said those negotiations have secured easements on more than 100 miles of the proposed route in Iowa, and that agreements on another 70 miles are in the final stages.

The company’s application with the Iowa Utilities Board says the pipeline is expected to cross 680 miles of Iowa land across 29 counties. There are potentially 15,000 Iowa landowners in the pipeline’s path.

“Summit Carbon Solutions’ project will transform the agricultural and ethanol industries across the region,” the company said in a statement Wednesday. “This substantial investment will allow future generations of farmers to continue to enjoy strong corn prices and land values for decades to come. Since late last year, we have been working closely with Iowa landowners to start the process of securing voluntary easements and are encouraged by the response.”

Summit has previously said the carbon sequestration project is needed to help lower ethanol’s carbon footprint to net zero by 2030. Summit says it has the capacity to capture up to 12 million metric tons of carbon annually, an amount equal to removing 2.6 million vehicles from the road each year.

In considering whether to grant a permit to Summit, the Iowa Utilities Board will have to consider issues including the potential environmental benefits of storing carbon underground, compared with safety concerns around transporting liquefied carbon dioxide.

The other two companies seeking to build carbon capture pipelines are Navigator CO2 Ventures and Archer Daniels Midland. All three pipelines would run through multiple states, including dozens of Iowa counties. They would capture carbon dioxide emissions from ethanol and fertilizer plants, then liquefy the carbon and transport it to be stored deep underground.

Republicans pull last-minute maneuver to save bill from deadline; Democrats object

Kaufmann’s bill is not the first attempt to block the pipeline developers’ ability to use eminent domain for their projects. Earlier this year, Sen. Jeff Taylor, R-Sioux Center, introduced a bill that would have prohibited the condemnation of farmland for “private development purposes.” But the measure failed to pass the Senate Commerce Committee before the Legislature’s first “funnel” deadline.

Kaufmann’s bill circumvents the second “funnel” deadline this week by replacing the language of an existing bill on cosmetology, which already passed the Iowa Senate. Ordinarily, a bill would have to pass a full chamber in the Iowa Legislature and a committee in the opposite chamber to survive the deadline.

House Democrats, who voted no on the bill in committee, said they are supportive of private property rights and said they wanted to hear from all sides who would be affected by the proposal. But they objected strenuously to the process used to advance the bill.

“Those are issues that we all do need to talk about and I do think there is a way to do that. Through a cosmetology bill is probably not the best way,” said Rep. Mary Mascher, D-Iowa City. “And we need to be transparent with our voters. We need to have an opportunity for everybody to weigh in.”

Some Democrats suggested they could support the bill if it provided stronger protections against eminent domain, like a three-year ban on its use instead of one year.

It’s unclear whether there will be support for the bill in the Iowa Senate, which like the House is controlled by Republicans.

“I’m not overly familiar with the House bill. They just rolled it out yesterday, and it was a surprise to me,” said Senate Majority Leader Jack Whitver, R-Ankeny. “And so we really need to sort through that.”

Stephen Gruber-Miller covers the Iowa Statehouse and politics for the Register. He can be reached by email at sgrubermil@registermedia.com or by phone at 515-284-8169. Follow him on Twitter at @sgrubermiller.

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