Floyd County hires law firm to help with CO2 pipeline zoning
By Bob Steenson, [email protected]
The new Floyd County Board of Supervisors at its regular meeting Monday morning approved hiring a Des Moines law firm to represent the county in developing a zoning ordinance that could regulate where hazardous liquid pipelines – especially carbon dioxide pipelines – can be located in the county.
The law firm, Ahlers & Cooney, could also represent the county if the county wishes to intervene with the Iowa Utilities Board in the permit application process for either or both of the two carbon dioxide transportation pipelines that could impact Floyd County.
The supervisors’ second meeting as a board again stretched well into the afternoon as the members spent almost four hours on one budget item – discussing whether or not to hire the law firm.
Included in the discussion were Tim Whipple, the Ahlers & Cooney attorney who would do the majority of the work with the county; representatives of the Navigator CO2 Ventures and Summit Carbon Solutions pipeline companies; the Valero Renewables ethanol plant manager; and dozens of county residents who were mostly opponents but included some supporters of the pipeline projects.
Whipple estimated that helping the county develop a zoning ordinance addressing hazardous liquid pipelines would cost about $7,000 to $10,000.
It would cost about $5,000 to $10,000 to review and update the county’s right-of-way ordinance referring to crossing county roads and other property, and intervening in the Iowa Utility Board docket on one permit application could cost up to $100,000, but that cost would be split among the four or five counties the firm was representing in the action.
Already signed on in addition to Floyd are Shelby, Emmet and Kossuth counties.
The vote to approve signing a letter of engagement with the law firm passed 2-0-1, with supervisors Mark Kuhn and Dennis Keifer voting for it and Jim Jorgensen abstaining from voting.
Asked later about the reasons for his abstention, Jorgerson said it was too soon to make the decision.
This was only the second board meeting that he and Keifer had ever attended as supervisors, he said, and the county had just started the annual budget process. Even if, as Chair Kuhn had said, there was money available either in American Rescue Plan Act (ARPA) funds or in the county budget to pay the legal bill, he wasn’t yet certain that was the best way to spend that money.
“It was just too fast,” he said.
Kuhn had introduced the idea of hiring the law firm as a discussion item last week, at the board’s first meeting. He said it had been a priority of his to address the pipeline issue, and that he had made it a campaign issue since first becoming aware that the Charles City Area Development Corp. (CCADC) had been considering granting an easement to Summit for a pipeline through the Avenue of the Saints Economic Development Park in southern Charles City.
Kuhn and others were at a meeting of the CCADC on Nov. 30, asking questions about the recommendation by the group’s Asset Management Committee to accept $299,000 for a permanent easement. The CCADC full board ended up postponing a decision on the recommendation.
Kuhn represents Supervisor District 1, which includes most of southern Floyd County and the part of Charles City south of the Cedar River. The two pipelines are mostly in District 1, with parts also in District 3, Jorgensen’s district.
“I guess the question is, and the question I proposed to the Area Development Corporation on Nov. 30, is this: Who would want to build on top of a hazardous carbon pipeline? According to our Area Development Board, it makes the northernmost 24 acres virtually undevelopable. That ground was purchased for $28,500 an acre. It is worth $10,000 perhaps to develop an ordinance and the county’s prorated share of perhaps $100,000, to protect that investment? I think so. I really do,” Kuhn said.
Kylie Lange, the Iowa project manager for Summit Carbon Solutions, said the CO2 pipeline would go in the same location as two existing natural gas pipelines through the development park, and the restrictions imposed by Summit as far as development would be exactly the same as already exist for the natural gas pipelines, in that they would allow paving over the pipelines for parking and access, but a company couldn’t build structures over them.
Supervisor Jorgensen said, “So, what I want to lead up to is nobody would build over a gas line anyway, would they? I wouldn’t.”
Contacted later Monday, Tim Fox, the executive director of the CCADC, confirmed that to his knowledge the restrictions imposed by Summit regarding development over the pipeline would be the same as already exist with the natural gas pipelines.
The difference is, Fox said,“We don’t know if companies are going to be comfortable with the new technology that this carbon sequestration pipeline brings, whereas with natural gas it has a history of regulation and safety. We don’t know whether that’s going to hold true with the carbon pipeline.”
Attorney Whipple said there are different federal regulations that affect natural gas and CO2 pipelines, and one question is whether the presence of a CO2 pipeline would endanger the site’s renewal as an Iowa Certified Development Site.
Jeff Sherman, the Floyd County zoning administrator, asked at the supervisors meeting if Charles City was doing anything about zoning regarding the pipelines, because county zoning would have no effect on the Avenue of the Saints Development Park since it is in city limits.
“To my knowledge the answer is no, they are not,” Kuhn said. “And you are correct, our zoning ordinance that we’re proposing would not impact, have any authority over that part of it.
“It’s interesting to me that it’s the county that is willing to stand up and fight for our economic development future, and we’ll just have to ask the city why to date they haven’t,” Kuhn said.
Kuhn said that by intervening in the Iowa Utilities Board docket on the pipeline permit applications, it could have an impact on decisions that affect the development park.
Contacted after the meeting, Charles City Mayor Dean Andrews said the topic hadn’t been raised at council meetings, and so far there was no consensus whether a CO2 pipeline would be a detriment to the industrial park or not.
“Is that going to affect the viability of that industrial park? It depends on who you talk to,” Andrews said. “Tim (Fox) did talk to the people who did the certification of the site and their opinion was that it won’t affect the viability of that park. Some people think, yes it will, and some people think, you’ve already got a gas pipeline going through there, what’s the difference?”
Charles City Administrator Steve Diers agreed, saying that was part of the discussion the CCADC is going through.
“I know from our end we’ve tried to raise that issue to be mindful of the decision we make here. We’re trying to sell that site. Is there going to be uncertainly about it? It’s hard to know because there seems to be a limited amount of information,” he said.
Many people at the supervisors meeting made comments regarding pipeline safety concerns and emergency services availability and response times, and arguments that eminent domain should not be used for for-profit companies.
Others said some easements that have been signed by landowners would result in the pipeline being located so close to the edge of those properties that they would be closer to a neighbor’s home than to the property with the easement.
Jake Ketzner, vice president of government and public affairs for Summit Carbon Solutions, said 82% of the pipeline mileage easements had been signed in Floyd County. That figure was 89% in Chickasaw County and 79% in Cerro Gordo County, and $4.7 million had already been paid in Iowa for easements.
He said Floyd County would receive about $875,000 annually in property taxes from the Summit project. He also said Summit had contracted with the Ellingson Companies of Minnesota to provide perpetual warranty for any damages done to drainage tiles because of the project.
Ketzner said 57% of Iowa corn goes to ethanol production, and virtually every ethanol plant in the state has signed on to a CO2 capture and sequestration pipeline project as the best way to reduce their carbon score so that can sell ethanol at a premium in many markets.
Those companies see the pipelines as the best way to keep their companies in business and competitive for the future, he said.
Ketzner said one concern over zoning controlling pipelines is that some of the ordinances that have been proposed or already passed by Iowa counties are so restrictive that there would be no place in the county that met the requirements and so the project would be dead.
Also, he said, with 82% of the easements already approved in Floyd County, a zoning ordinance could change the conditions that would affect those easements already in place.
Dean Tjaden, who farms north and east of Charles City and who raises cattle, said the cattle industry has made a comeback in Iowa because of the availability of wet distillers grain, a byproduct of ethanol production, and if ethanol left the state, so would the cattle industry again.
Paul Rottinghaus, a member of the CCADC board, owner of Zip’s/Aw Direct in New Hampton and owner with his family of a partnership that owns the former Sherman Nursery and the former Kmart property in Charles City, said he was investing millions of dollars in industrial development for the community and planning to invest millions more “to provide modern housing options to entire new families seeking employment by Charles City employers to come here, add to our tax base, fill our schools and bring some vibrancy to our county.”
“I doubt that there is anyone in this room whose property tax bill is comparable to ours,” he said. “It is from that perspective that I am here to ask why we should be considering spending our tax dollars on an attorney in Des Moines to object to what is probably a project that is for the common good.”