Federal Railroad Administration says: No.

From a release issued by the Federal Railroad Administration:
FRA Administrator Denies DM&E Powder River Basin Loan Application Citing Unacceptable Risk to Federal Taxpayers

Contact: Steve Kulm
Telephone: 202-493-6024

Monday, February 26, 2007 (Washington, DC) Federal Railroad Administrator Joseph H. Boardman today denied a $2.3 billion Railroad Rehabilitation and Improvement Financing (RRIF) loan application from the Dakota, Minnesota, & Eastern (DM&E) railroad concluding it posed an unacceptably high risk to federal taxpayers.

In a decision released today, Boardman found that while the Powder River Basin project met some of the RRIF program’s statutory requirements, there remained too high a risk concerning the railroad’s ability to repay the loan even with an appropriate combination of credit risk premiums and collateral.

He said he was concerned by several factors, including the DM&E’s current highly leveraged financial position; the size of the loan relative to the limited scale of existing DM&E operations; and the possibility that the railroad may not be able to ship the projected amounts of coal needed to generate enough revenue to pay back the loan.

In addition, Boardman cited concerns that the application did not sufficiently address how the railroad would handle potential cost overruns and schedule delays with the Powder River Basin construction project.

Boardman reached his final decision after reviewing the DM&E application using the criteria set by Congress for the RRIF loan program and following an environmental review of the proposed project.

DM&E had applied for the RRIF loan to finance construction of a new 280-mile rail line to Wyoming’s Powder River Basin coal mines and to reconstruct approximately 600 miles of existing track in South Dakota and Minnesota.

###
This is bad news for South Dakota. That's $2.3 billion worth of infrastructure enhancement and economic development that we are not going to see.

Comments

milt said…
Well then. Kevin S. should get out and find private sector venture capital. Shouldn't be too hard if it's a viable and lucrative project. It's not the south dakota chamber way, but it is the free enterprise way and that works just as well in SD as it does in the good ol United States.
Anonymous said…
We can all thank Daschle and Janklow for STABBING SOUTH DAKOTA IN THE BACK and killing the biggest project in South Dakota history. Those bitter has-been hacks are so pathetic it makes me sick
Anonymous said…
milty - it was 2/3 private financed already. Apparently thinking big, being progressive, taking chances and trying to make SD a better place with better and more jobs is not something old Milty wants, because if that happened then he'd have to find something else to whine about.
Anonymous said…
The lefty SD blogs are already crowing about this because of Thune. PP, why do you call that egotistical, elitist, know-it-all guy at ThuneWatch a "friend"????
Anonymous said…
Thune's "clout" is really something in GOP circles, isn't it.

Has this guy ever been able to get something done by himself?

Gee-whiz.
Anonymous said…
7:37. One word: Ellsworth

Yes, all by himself
Anonymous said…
It's funny that people accused Thune of doing it for the money, though he no longer stood to benefit from it. When actually it was Daschle and Janklow, the back-stabbing Benedict Arnolds of South Dakota, who were doing it for the bucks.

Thune's position was pro-DME and consistent all along for the past 10-15 years. Daschle and Janklow were the flip floppers who bent over for whoever had the checkbook.
Mad-Huronite said…
Daschle and Janklow are complete political whores who sold out their state's interests after PUSHING THE PROJECT FOR YEARS WHEN IT WAS IN THEIR INTEREST...they are despicable and disgusting
Anonymous said…
Thank you 7:47. Well said!!
And 7:41, also a good point. The Can't Get Over It crowd gleefully blamed Thune when Ellsworth made the hit list, but refused to give him credit when it was saved. There are many independent people who said that Thune did more to save Ellsworth than ANYBODY. So I don't think we need to write off DME either.
Anonymous said…
these people who are criticizing Thune just don't persuade me. Thune worked hard for his state and that's all we can ask.
Anonymous said…
I couldn't care less about Thune, Tommy-boy, Janklow, or anybody else you conspiracy theorists want to blame for this.

BUWAHAHAHAHAHA!

I'M GLAD OL' KEVIN S. GOT A SETBACK HERE. Take the railroad, the "economic development", the "infrastructure upgrades" and shove 'em.

BUWAHAHAHAHAHAHA!

This is GREAT news for South Dakota. I guess Minnesota, too.
Anonymous said…
There is a huge amount of anger in Huron, like you would not believe. Rochestor and Daschle and Janklow should be run out of the country!
Anonymous said…
First off I do not beleive it is 2/3 privately funded, I though am glad it failed, it would have ruined life in many towns such as Pierre, perhaps he should of tried staying in the original Milwaukee road bed. I am saddened the most by the fact we dont get to see what all the private property people fight for in their beleifs, and would have had to turn their backs on in the taking of private property by eminent domain of private property for a railroad.
Mary P said…
these comments are harsh, but there's no doubt about it, Daschle and Janklow are traitors to their state

I'm embarassed they were ever elected to anything in South Dakota
Tom Daschle said…
if it can be made to look like a loss for Thune, screw the state of South Dakota...the citizens of SD are obviously idiots anyway...

Tom
Douglas said…
Gosh, wonder if the DM&E loan would have had a better chance if Daschle was still majority leader?

This goes back to college days for Janklow and Pressler. They have kept a good feud going for many years.

I think we should be putting trillions into wind energy for generation of hydrogen and methanol and shift from coal and foreigh petroleum as fast as possible. What were the ecological impacts of the DM&E hauling coal or will that hauling be handled well enough by existing railroads and they can take the blame.

I could not understand why the DM&E could not figure out a way to run around the Mayo, etc. and have avoided generating them as enemies.
Anonymous said…
Jailbird Janklow better not run over and kill someone in Beadle County or the sheriff will lock him up and forget where the key is.....
Anonymous said…
I can tell you one thing. May people in Pierre were pretty happy to hear the news.
Anonymous said…
Sounds to me that the DM&E should have hired both Thune and Janklow. Their bad!
Anonymous said…
anol 7:29...Quit your whining!
Anonymous said…
Clearly this wasn't anything about a credit decision. This was all about politics. The way Mayo Clinic went after John Thune was shameless. It pains me to know that Mayo, who incidently was adjudicated by the US Dept. of Justice for fraud, is treated to ongoing grants, even though they've tried repeatedly to rob us taxpayers blind. Where's CAGW when it comes to giving money to people who've already tried to steal from us. I guess you put that money in the same pile as the $10 Billion that no one can seem to find for the Iraq war.

As far as Thune goes, I've never met a more honorable man. I'm sick of watching the DM&E Opposition go after him with their lies. Klobuchar and Walz can say what they want but the real truth is that money won out over what was right.

Popular posts from this blog

Why should we be surprised?

That didn't take long