L.G. Everist to purchase South Dakota-owned track

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A D & I rock train crosses the Big Sioux River near Hudson, S.D., on state-owned track on July 25, 2016.
Steve Glischinski
SIOUX FALLS, S.D. – The South Dakota Railroad Board has authorized the South Dakota Department of Transportation to negotiate the sale of its Sioux Valley Line between Canton and Elk Point, S.D. to L.G. Everist, Inc., which owns D & I Railroad. The railroad is a wholly-owned subsidiary of L.G. Everist, an aggregates company founded by Lucius Garland Everist in 1876 and still owned by the Everist family. D & I is the only user of the line. The railroad reports that so far the state has not yet given its any information to move the sale process along.

D & I operates on 130 miles of track – 84 miles of leased/owned track and 46 miles of trackage rights over BNSF Railway. Its main line is the 112-mile former Milwaukee Road line between Dell Rapids, where it serves large rock quarries, and Sioux City, Iowa. L.G. Everist only owns 18 miles of line between Dell Rapids and Sioux Falls. From Sioux Falls it operates on BNSF Railway trackage rights to Canton where it swings onto State of South Dakota-owned track to Elk Point. There it returns to BNSF rails into Sioux City, where Everist maintains a transload facility for the distribution of aggregates. Also included in the sale will be the 18-mile ex-Chicago & North Western branch line between Hawarden, Iowa, and Beresford. After the sale is completed D & I would gain ownership of all the state-owned track it currently uses.

In June 2019 the South Dakota Railroad Board authorized the DOT to prepare packages for soliciting proposals for the purchase state-owned rail lines. The majority of the lines were acquired after the 1980 Milwaukee Road embargo which resulted in bankruptcy filing and possible abandonment of the lines. DOT prepared packets for each line, provided tours for inspection of the lines, and provided a question and answer forum to answer any remaining questions.

Nine operating proposals from seven proposers were received during the invitation for proposal. During their special board meeting on Dec. 4, the Board provided applicants the opportunity to present their proposals prior to the Board making any final decisions. However, on Dec. 19 the Board rejected eight of the nine proposals, only accepting the one from L.G. Everist. Those offers included proposals on the Britton Line, Mitchell to Rapid City Line, Napa to Platte Line, and the Wolsey Interchange west of Huron. There were no proposals submitted for the Yale Line near Huron. With the rejection of the proposals, those lines will remain the property of the State and will continue to be operated by the current lease/sublease holders.

“We are pleased the Board agreed to move forward with negotiations for the Sioux Valley Line and look forward to discussing the possible sale of this railroad asset with L.G. Everist,” South Dakota Transportation Secretary Darin Bergquist said in a news release. “Although we are disappointed with the result of proposals for the other lines, we learned a lot by going through the process and feel there will be other opportunities for future solicitations. The goal is to get these rail lines back in the hands of private entities, as long as it is the best interest of the State of South Dakota.”

NEWSWIRETrains News Wire

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