The South Dakota Railroad Board decided Wednesday there isn’t a reason to rush for federal funding for a major improvement on its Mitchell-Rapid City line.
Board members agreed last month to seek federal aid for a meet-and-pass that would let trains get around each other on the single track. They thought the deadline for a federal grant was June 21, based on information from Joel Jundt, deputy secretary for the state Department of Transportation.
But Jundt said Wednesday he’s received further information from federal officials that available funding could roll over to next year. The board accepted his recommendation to delay the application and pay up to $30,000 to Civil Design Inc. to develop a preliminary design.
“This wasn’t going to happen in two months,” Jundt said.
That also provides more time to work with Dakota Southern on a cost-sharing plan. Seven possible sites previously were identified between Mitchell and Chamberlain. The estimated cost is $1.8 million; the federal funding currently available would have paid up to $978,200.
Jundt said Wednesday that South Dakota could receive another $8.2 million in the 2019 federal fiscal year. In addition to freight customers, there are two large grain-loading facilities at Kimball and Kennebec, with a third planning to start shipments at Presho this fall.
Dakota Southern operates on the line under a sublease from the Mitchell Rapid City regional railroad authority that leases it from the state.
The board also set a formal policy Wednesday for paying landowners who want to separate their livestock pastures from the rights of way along state railroads.
The state rail office has spent approximately $3,500 to $8,500 reimbursing landowners for materials during each of the past three years. The money came from the state railroad administration fund.
The board switched the funding source Wednesday to the state railroad trust fund, set an annual limit of $25,000 total and gave the green light for the office to approve a project up to $5,000. A project costing more needs board approval.