PIERRE, S.D. (KELO) — There’s a bit more of backstory to the Wednesday announcement that the South Dakota Department of Transportation will receive approximately $24 million in Consolidated Rail Infrastructure and Safety Improvements (CRISI) program funding for the Sisseton Milbank Railroad modernization project.
Governor Kristi Noem appointed Ralph Schmidt of Big Stone City to the state Railroad Board effective June 13, 2023, succeeding Jon Kirby of Sioux Falls. Schmidt is general manager for Sisseton Milbank Railroad.
At the time of Schmidt’s appointment, the state department’s application was still pending for the federal grant to assist the Sisseton Milbank Railroad, which is a subsidiary of Twin Cities & Western Railroad Company.
Earlier this year, the Noem administration received the Legislature’s approval for $6.25 million in state funding to further assist Sisseton Milbank Railroad with the project.
News of the Federal Railroad Administration’s approval of the federal grant on Wednesday came one year after the state Railroad Board decided to submit the request for it.
That same day, on September 21, 2022, the state board approved a low-interest loan up to $6,250,000 to the Roberts County Regional Railroad Authority for the project, with the loan guaranteed by Sisseton Milbank Railroad and Twin Cities & Western Railroad Company. Schmidt is secretary of the regional rail authority.
Sisseton Milbank Railroad also is seeking a federal Special Transportation Circumstances grant of $1,687,038.58 to replace 2.5 miles of 60-pound rail north of Wilmot with new jointed 115-pound rail, as well as adding 2,400 tons of ballast and surfacing that stretch of track.
Schmidt formally disclosed his various conflicts of interest at his first meeting as a state board member on August 16, 2023.
The board’s legal counsel recommended that day that Schmidt shouldn’t participate in board discussions and board votes on matters involving Sisseton Milbank Railroad and Roberts Regional Railroad Authority. Other board members then voted to accept the disclosure, finding that the matters in Schmidt’s waiver request were “fair, reasonable, and not contrary to public interest.”
One of the governor’s sons-in law, Kyle Peters of Watertown, has represented A1 Development Solutions before the Railroad Board recently regarding loans for two projects, according to the board’s minutes: The soybean-processing plant being built at Mitchell and a loading-siding for a sunflower plant at Huron.