This story has been further updated with more testimony from Minnehaha County Commission member Joe Kippley.

PIERRE, S.D. (KELO) — Lawyers for Minnehaha County and Moody County argued Thursday that the South Dakota Public Utilities Commission shouldn’t overrule their counties’ pipeline zoning ordinances.

Navigator wants the state commission to pre-empt the local regulations, which the company’s Monica Howard said Thursday would keep it from building a multi-state carbon-dioxide pipeline through five South Dakota counties.

But Minnehaha County’s Alex Hagen and Moody County’s Paul Lewis poked holes in her claim.

Howard, the company’s environmental and regulatory vice president, admitted that Navigator hadn’t yet submitted an application to Minnehaha County. She said Navigator was waiting for the conclusion of the state proceeding.

Howard also acknowledged that the pipeline could be built if the company took a route west of Sioux Falls, rather than the company’s proposed path between Brandon and Valley Springs on Minnehaha County’s east side.

In her pre-filed testimony, Howard was asked, “Can Navigator comply with the setback distances in the Moody County Zoning Ordinance?” She answered, “No. Based on a 1,500-foot separation distance, Navigator’s current route would violate the proposed ordinance. Navigator could not find a feasible route through Moody County based on a 1,500-foot separation distance.”

Lewis pointed out that the Moody County Commission reserved the right to reduce the 1,500-foot distance. Howard acknowledged that Navigator hadn’t yet sought a reduction in the setback.

Howard said the company sought the state pre-emption because of the time needed to go through the two counties’ processes. “Our route before the PUC does not comply with either ordinance,” she told Brian Jorde, an attorney representing landowners who don’t want the project crossing their properties.

Howard began testifying shortly after 9 a.m. She wasn’t finished when she stepped off the witness chair at 5 so that Minnehaha County Commission member Joe Kippley could testify.

Minnehaha County has pre-filed testimony from Kippley, who amended Minnehaha County’s setback distance for pipelines to 330 feet from 750 feet, and the county’s planning and zoning director, Scott Anderson.

Kippley said the Minnehaha County Commission believed the only thing that needed to be regulatory oversight was a possible future eruption. He said the county planning commission proposed 750 feet. He convinced the county commission to reduce the setback to 330 feet. “That’s still my position today,” Kippley said.

Kippley said he agreed with Minnehaha County Commission chair Jean Bender’s observation that the county panel wasn’t looking for a regulation that was onerous or would arbitrarily kill the project. He said they looked at the ordinance generically. “We never overlaid exact pipeline routes as proposed,” Kippley said.

The Minnehaha County regulation calls for the 330 feet to be measured from the property line, rather than occupied structure, as Kippley wanted. He said the ordinance also was intended to tell landowners they should think about whether it was wise to build within 330 feet of the pipeline.

Kippley said the $25,000 fee originated from the planning commission and the Minnehaha County state’s attorney office. He said the CO2 pipelie was a new concept that would take time for the staff to review.

Asked how the ordinance wasn’t unreasonably restrictive, Kippley replied, “It was a series of legislative compromise on every step of the way.” He said the commission tried to be reasonable to the landowners and to the pipeline and wanted to encourage more pipelines. “Trying to find a win-win,” he said.

The county planning commission ran nearly five hours and the Minnehaha County Commission met twice on the recommendation. Kippley paraphrased another Minnehaha County commissioner, Dean Karsky, who thought it was the most feedback the county commission had received in the 12 years Karsky had served.

State commissioner Chris Nelson asked how Minnehaha County would handle the situation if Navigator got 28 of 29 landowners to sign waivers. Kippley said the county commission would hear from all parties and make a decision.

State commissioner Gary Hanson asked Kippley whether he was convinced Navigator wouldn’t have a route without the county ordinances overruled. Kippley said the ordinance was intended to set out objective criteria. “Nothing in this ordinance is impossible. It would go to a conditional use hearing,” Kippley said.

He later added that it wasn’t a Navigator ordinance. “It was not about or against or for any one pipeline project,” Kippley said. 

The state commission plans to make a decision on September 6 on Navigator’s overall request for a permit for the project. The pre-emption portion of the hearing will continue Friday at 8 a.m. CT.