County’s efforts to regulate pipeline are challenged in court

Summit Carbon Solutions, which hopes to build a pipeline to transport carbon dioxide across Iowa, is suing Story County to block efforts to regulate the pipeline’s construction and location.

Summit filed a lawsuit Monday in U.S. District Court for Southern District of Iowa against the Story County Board of Supervisors. The company is alleging the locally elected county supervisors are attempting to impose on the project “public safety” requirements that are the exclusive province of federal regulators.

Summit is developing an interstate pipeline that, if completed, will transport carbon dioxide captured from more than 30 facilities — primarily ethanol plants but also fertilizer plants — across South Dakota, North Dakota, Nebraska, Minnesota and Iowa through a network of 1,900 miles of underground pipes.

In Iowa, the project would likely involve 680 miles of pipeline through 30 counties.

Summit is now in the process of surveying routes for the project and securing the necessary permits while negotiating with landowners for access to their property.

Summit has been working with the Iowa Utilities Board for more than a year as part of the planning and permitting process. The company says it has already obtained voluntary easements for nearly 60% of the proposed route in Iowa, and has paid out millions of dollars to Iowa landowners.

The lawsuit alleges that some Iowa counties, including Story County, have taken steps on their own to regulate pipelines. That’s improper, the lawsuit asserts, because the federal government regulates the safety of pipelines such as the one proposed by Summit, and the Iowa Utilities Board has the statutory authority to issue route permits.

On Oct. 25, the Story County Board of Supervisors passed an ordinance that establishes setback and other requirements for hazardous materials pipelines in the county.

The lawsuit notes that at a board of supervisors meeting on Oct. 18, Amelia Schoeneman, Story County’s planning and development director, explained the purpose of the ordinance was to regulate “hazardous materials pipelines that pose … health and safety risks” to the public. The setbacks, she stated in a memo to the board, were “the minimum necessary to protect public safety.”

Summit argues the Story County ordinance prevents the company “from completing — or even beginning — the portion of the pipeline project in Story County.” The company says “federal law already exclusively regulates interstate pipeline safety under the Pipeline Safety Act,” which was enacted by Congress in 1994.

That federal law, Summit claims, expressly preempts any local government’s attempt to impose safety regulations on interstate pipeline projects.

Lawsuit could have an impact in other counties 

The lawsuit seeks a court order declaring Story County’s ordinance to be preempted by the Pipeline Safety Act and thus invalid and unenforceable, at least as it relates to Summit’s planned pipeline. Such an order would likely have an impact on other Iowa counties that have sought to regulate pipelines, as well as other companies that have competing pipeline projects.

A central element of Summit’s lawsuit is the importance of ethanol production to Iowa’s economy. The lawsuit notes that more than half of all corn harvested in Iowa goes to ethanol production. The corn grown in Iowa is used to create 26% of all American ethanol, the company argues, and “corn’s value in Iowa — and throughout the nation — is inextricably tied to ethanol production.”

A co-plaintiff in the Summit case, who helps give the company standing to sue in federal court, is William Couser, a Story County farmer who owns a 5,200-head feed lot along the Summit pipeline route.

All of the corn grown on the Couser farms, with the exception of a small amount that is fed to his cattle, is sold to Lincolnway Energy for ethanol production, according to the lawsuit.

Couser is one of the founders of Lincolnway Energy, which operates its ethanol production facility in Story County. With the pipeline, Lincolnway Energy would have a so-called “carbon intensity score” that would enable it to ship ethanol to California and Pacific Northwest markets currently that are currently closed to the company.

Story County has yet to file a response to the lawsuit.

Two weeks ago, the Shelby County Board of Supervisors gave unanimous approval to an ordinance that would force Summit and other pipeline companies to obtain county permits for construction and impose restrictions on any pipeline’s proximity to homes, schools and farm. At this point, Shelby County is not named as a defendant in Summit’s lawsuit.