The Surface Transportation Board has approved Rapid City, Pierre & Eastern Railroad’s acquisition of a 15.33-mile state-owned rail line in South Dakota that the railroad has operated under lease since 2014.
The Huron-Yale Line extends from milepost 160.33 in Huron to approximately milepost 145 in Yale. RCPE, a Class II railroad, petitioned the board in May for an exemption from federal requirements that would otherwise require prior approval of the transaction.
South Dakota acquired the line in 2008 from Dakota, Minnesota & Eastern Railroad through a series of transactions. The state has since leased the property to the East Central Regional Rail Authority, which subleased it first to DM&E and then to RCPE after RCPE acquired certain DM&E lines in 2014.
Under the planned transaction, RCPE will purchase the line from the state, ending the existing lease and sublease arrangements.
RCPE told regulators it does not plan to change operations, maintenance or dispatching on the route. The railroad said shippers will see no change in service or service options as a result of the ownership transfer.
The board found that detailed regulatory review was unnecessary because RCPE already provides service over the line and the acquisition would not reduce rail competition or alter the competitive balance.
The STB also waived a 60-day employee notification requirement after finding that no railroad employees would be adversely affected. The union representing RCPE employees submitted a letter supporting the transaction.
The exemption becomes effective Sept. 5, unless stayed. RCPE has said it wants to close the transaction by Oct. 31.
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