Polk County District Court Rejects Landowners' Eminent Domain Challenge

February 17, 2017
Kristine A. Tidgren

A Polk County District Court judge has ruled that the Iowa Utilities Board properly acted within its discretion in determining that the Dakota Access pipeline would promote the “public convenience and necessity.” The court also found that the Board had statutory authority to grant Dakota Access eminent domain over impacted parcels of agricultural land. The ruling was in response to four petitions for judicial review filed with the court following the Board’s decision to grant a hazardous pipeline permit to Dakota Access. Landowners filed three of those petitions, and the Sierra Club filed the other.

Two main questions were at issue in this case: did the Board properly conclude that the Dakota Access pipeline would promote the "public convenience and necessity," and did Iowa law restrict the use of eminent domain with respect to the agricultural land at issue in this case?

"Public Convenience and Necessity"

The court first concluded that the Board’s interpretation of “public convenience and necessity” should be granted deference because this determination was a “legislative, not a judicial, function.” The structure of the statute, the court reasoned, demonstrated a legislative intent to defer to the Board’s interpretation.

The court then considered whether substantial evidence supported the Board’s determination. The court found that the Board properly concluded that “necessity” could not have its ordinary dictionary meaning or a permit would never be granted. Rather, the court found that the Board properly determined that “necessity” more appropriately means “needful, requisite, and conducive.”  It then set out to balance the public interests against the private costs and detriments.

The court found that substantial evidence supported the Board’s conclusion that the public interests of (1) increased safety (as opposed to transport by rail car) and (2) economic benefit stemming from the construction of the pipeline (estimated to be between $787 million and $1.1 billion) outweighed the detriments of (1) environmental concerns, (2) safety risks, and (3) oil spill remediation.

The court dismissed the petitioners’ contention that the pipeline would not be a “service to the public” since it merely runs through the state and does not provide a direct service to Iowans. The court determined that any Iowa pipeline would suffer that same limitation since Iowa does not produce crude oil nor house a crude oil refinery. As such, the court found that could not be the governing legal standard for the Board to apply when considering whether to allow an “interstate pipeline” authorized by statute.

Eminent Domain Power Over Agricultural Land

The court then addressed the petitioners argument that eminent domain was not properly granted in light of Iowa Code §6A.21, which limits the condemnation of “agricultural land” to those uses involving a "public purpose."  The court found that this provision contained an exception directly pertaining to the case at hand. Iowa Code §6A.21(1) specifically states that the limitation does not apply to companies or corporations “under the jurisdiction of the Iowa Utilities Board.” Dakota Access, the court found, was one of those companies.

This exception, the court reasoned, clearly demonstrated that the legislature did not intend to overrule Iowa Code § 479B (allowing the granting of eminent domain power to pipeline companies) when it crafted the agricultural land protection provision.

Appeal in the Works

The landowners in this case have vowed to appeal the decision to the Iowa Supreme Court. It will be most interesting to see if the Court will choose to use this case to further define the contours of “public convenience and necessity.”

We’ll keep you posted.

CALT does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. CALT's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.

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