Steve Forbes in a recent issue of Forbes discusses the infamous $2.3billion loan the FRA(Federal Railroad Admin.) is considering giving to a small privately owned railroad to build a new line to haul coal from Wyoming. Leigh Pomeroy, at voxverax has the article. The railroad, the Dakota, Minnesota, and Eastern has one of the worst safety records in the US, and is one of only two railroads of 600 plus in the United States to be under a Safety Compliance order by the FRA for its' poor management in maintaining safety.
One can easily scratch their head in wonder how a mainly Scottish owned railroad with a terrible safety record has come into a position that it may be racking up nearly 95% of the federal loans given to railroads. The government wouldn't be in this position if Sen. Thune-R of South Dakota, a former DM&E lobbyist, hadn't slipped it in in a conf. committee in late 2005. It was part of the more widely know package that also had the "bridge to nowhere". More after the fold.
While the "bridge to nowhere" is more well known, this loan creates a lot of harm. The 260 mile new build section of the line will cross national grasslands and generations old ranches. The railroad CEO and Sen. Thune want factories and ethanol plants along the existing line in MN and SD to convert from natural gas to coal. Cities along the line like Pierre and Brookings SD, and Owatonna, Mankato, and Rochester MN, will have to pick up the tab for mitigation for the privilege of having coal trains running through their city from Wyoming to the likely destination market, Chicago. The trains will run within a block of the Mayo Clinic, endangering hundreds of patients in surgery and ICU if they can't evacuate if there is a hazardous spill. The Sierra Club of South Dakota has been active legally in this fight on behalf of those who support environmental, tribal, and historical preservation issues. Rochester groups have fought the project on many fronts.
In recent months, large anti waste and pork groups have come out against this issue as the Forbes article explains. No group has figured out how the railroad can ever repay their loan. It is a low interest loan, no collateral required, and if the railroad defaults, it is not required to sell off assets to make good on the loan.
There's a lot of information out there on the loan and project. One source
Track the Truth has a lot of links to different groups.
At a time when we should be aiding alternative energy sources to reduce global warming, our federal government is subsidizing coal.