CHAPTER 70:05:01
ADMINISTRATION
Section
70:05:01:01 Terms.
70:05:01:02 Meetings and quorum, Repealed.
70:05:01:03 Declaratory rulings.
70:05:01:04 Approval of division action, Repealed.
70:05:01:05 Adoption of guidelines for property management -- Notice required, Repealed.
70:05:01:01. Terms. Terms used in this article mean:
(1) "Board" the South Dakota State Railroad Board; and
(2) "Department" the South Dakota Department of Transportation.
Source: 8 SDR 35, effective October 4, 1981; 13 SDR 129, 13 SDR 134, effective July 1, 1987; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 1-44-30, 10-28-21.6, 49-16C-3.
Law Implemented: SDCL 1-44-30, 10-28-21.6, 49-16C-3.
70:05:01:02. Meetings and quorum. Repealed.
Source: 8 SDR 35, effective October 4, 1981; 13 SDR 129, 13 SDR 134, effective July 1, 1987; 49 SDR 47, effective November 21, 2022.
70:05:01:03. Declaratory rulings. A person may petition the board to issue a decision on the applicability of any statute, rule, or order pertaining to railroad matters under its jurisdiction by filing a written request with the secretary of the department. The board shall send a written decision to the petitioner within forty-five days after the secretary receives the request.
Source: 8 SDR 35, effective October 4, 1981; 13 SDR 129, 13 SDR 134, effective July 1, 1987; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 1-26-25.
Law Implemented: SDCL 1-26-15.
70:05:01:04. Approval of division action. Repealed.
Source: 8 SDR 35, effective October 4, 1981; 13 SDR 129, 13 SDR 134, effective July 1, 1987; 49 SDR 47, effective November 21, 2022.
70:05:01:05. Adoption of guidelines for property management -- Notice required. Repealed.
Source: 8 SDR 174, effective July 1, 1982; 13 SDR 129, 13 SDR 134, effective July 1, 1987; 49 SDR 47, effective November 21, 2022.
CHAPTER 70:05:02
MANAGEMENT OF RAILROAD PROPERTY
Section
70:05:02:01 and 70:05:02:02 Repealed.
70:05:02:03 Reserved.
70:05:02:04 to 70:05:02:12.03 Repealed.
70:05:02:13 to 70:05:02:15 Reserved.
70:05:02:16 Record of income.
70:05:02:01. Application for license and permit -- Form and fee.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:02. Criteria for approval.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:03. Reserved.
70:05:02:04. Application for a haying permit -- Form and fee.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:05. Haying permit -- Criteria for approval and fee.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:06. Application for a grazing permit -- Form and fee.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:07. Grazing permit -- Criteria for approval and fee.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:08. Notice of property for lease.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 8 SDR 94, February 14, 1982.
70:05:02:09. Application for lease -- Form and fee.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:10. Priority of current lessees.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:10.01. Lease of property -- Director of division to negotiate.Repealed.
Source: 8 SDR 94, effective February 14, 1982; repealed, 10 SDR 107, April 11, 1984.
70:05:02:11. Bidding procedure to be used if no current lessee or current lessee does not renew.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 8 SDR 94, February 14, 1982.
70:05:02:12. Minimum rental rate.Repealed.
Source: 8 SDR 35, effective October 4, 1981; repealed, 10 SDR 107, April 11, 1984.
70:05:02:12.01. Application for lease of trackage -- Form and fee.Repealed.
Source: 8 SDR 94, effective February 14, 1982; repealed, 10 SDR 107, April 11, 1984.
70:05:02:12.02. Lease of trackage -- Director of division to negotiate.Repealed.
Source: 8 SDR 94, effective February 14, 1982; repealed, 10 SDR 107, April 11, 1984.
70:05:02:12.03. Minimum rental rate for lease of trackage.Repealed.
Source: 8 SDR 94, effective February 14, 1982; repealed, 10 SDR 107, April 11, 1984.
70:05:02:13. Reserved.
70:05:02:14. Reserved.
70:05:02:15. Reserved.
70:05:02:16. Record of income. The department shall keep on file a record of all agreements, maps, and income related to the management of railroad property.
Source: 8 SDR 35, effective October 4, 1981; 13 SDR 129, 13 SDR 134, effective July 1, 1987; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 1-44-30.
Law Implemented: SDCL 1-44-29.
CHAPTER 70:05:03
RAILROAD TRUST FUND LOANS
Section
70:05:03:01 Definitions.
70:05:03:02 Eligibility requirements.
70:05:03:03 Application requirements.
70:05:03:04 Equity contribution, Repealed.
70:05:03:05 Permissible uses of loan proceeds.
70:05:03:06 Factors for board action.
70:05:03:07 Loan agreement and time restrictions.
70:05:03:08 Loan security.
70:05:03:09 Borrower reporting requirements.
70:05:03:10 Inspection of the borrower by the board and retention of records.
70:05:03:11 Additional notification requirements.
70:05:03:12 Maturity and interest rate.
70:05:03:13 Review of financial status.
70:05:03:14 Default on loan agreement.
70:05:03:15 Delegation of administrative functions.
70:05:03:01. Definitions. Words used in this chapter mean:
(1) "Applicant" a regional railroad authority created pursuant to the provisions of SDCL chapter 49-17A;
(2) "Benefitted entity" an individual, corporation, partnership, limited liability company, or other business entity that will directly benefit from a railroad trust fund loan;
(3) "Borrower" an applicant who has been awarded a loan from the railroad trust fund;
(4) "Railroad trust fund" a special fund within the state treasury created pursuant to SDCL chapter 49-16C;
(5) "Primary jobs" jobs that provide goods and services which are primarily exported from the state, that gain market share from imports to the state, or that meet an unmet need in the area and result in the creation of new wealth. Primary jobs are derived from businesses that bring new income into an area, stimulate other local businesses, or assist a community to diversify and stabilize its economy;
(6) "Railroad infrastructure" components of railroad track or other railroad structures, including bridges and drainage facilities;
(7) "Total project costs" the direct costs associated with the purchase of materials and services, necessary site development and improvements, construction or rehabilitation, and works necessary to the operation and protection of the project;
(8) "Rail operator" the railroad company that will provide rail service.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 1-44-20, 49-16C-3.
Example: (2) "Benefitted entity": a grain elevator that will ship grain on a railroad siding constructed with a railroad trust fund loan.
70:05:03:03. Application requirements. The department shall provide application forms to applicants. The application must be complete before it is processed. Applications must include the following information:
(1) The applicant's name and address;
(2) A detailed description of the proposed railroad project;
(3) The names and addresses of the proposed rail operator and any other benefitted entity;
(4) Articles of incorporation and bylaws or other agreements that describe the legal operation or structure of the regional railroad authority;
(5) A statement that addresses the economic benefit of the project;
(6) Assurance of compliance with local zoning laws and building codes;
(7) The approximate project commencement date, the completion date, and the date by which the project will be fully operational; and
(8) Any other information requested by the department or the board to make a sound loan decision.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:04. Equity contribution. Repealed.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
70:05:03:05. Permissible uses of loan proceeds. Railroad trust fund loans may be used for the acquisition, development, and improvement of railroad infrastructure.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:06. Factors for board action. When making a decision on an application, the board shall consider the following:
(1) Number of primary jobs created;
(2) Amount of the loan requested;
(3) Net economic effect on the area and state;
(4) Transportation needs of the area served by the project;
(5) Support of the public entities of the community and area;
(6) The amount of the financial contribution by the applicant or others to the project;
(7) The effect of the project on the environment, health, and safety of the people in the area and state;
(8) Compatibility with the economic development plans of the area and state;
(9) The potential success of the project;
(10) The character, experience, management record, and financial capacity of the rail operator and any other benefitted entity;
(11) The capacity of the applicant to repay the loan. In determining the capacity of the applicant, the board may consider the following:
(a) The amount of the loan;
(b) The economic feasibility of the project;
(c) The ability of the applicant to service the debt;
(d) The financial status of the project, applicant, and rail operator; and
(e) The satisfaction of engineering, legal, and environmental regulations;
(12) The total capitalization of the project, including any capitalization subordinated to the trust fund loan; and
(13) The terms and conditions of the loan.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:07. Loan agreement and time restrictions. The applicant must comply with any conditions required by the board before approval of the application is given. Within ninety days after the board approves the loan, the applicant shall execute a loan agreement with the department. The loan agreement must contain the rights and responsibilities of the parties and the terms and conditions of the loan. If mitigating circumstances prevent the execution of a loan agreement within the ninety-day period, the board may grant an extension of time. Within six months after the execution of the loan agreement, the applicant shall commence construction of the project. If mitigating circumstances prevent starting the project and a diligent effort has been made, an applicant may apply to the board for an extension of time. The request for extension must be submitted to the secretary of the department prior to the expiration of the six-month period unless the board waives this requirement. The board shall decide the length of the extension period based on the mitigating circumstances.
Source: 19 SDR 107, effective January 24, 1993; 48 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:08. Loan security. Loans may be secured by a guarantee or promissory note executed by the benefitted entity, liens on the interest of the borrower in all real and personal property, easements, rights-of-way, a commitment by the borrower to exercise taxing authority, and any other assets of the borrower considered necessary by the board to adequately secure the loan.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:09. Borrower reporting requirements. Until the prinicipal and any interest is paid in full, the borrower shall submit an annual report to the department containing the following information:
(1) A summary of the status of the project;
(2) An update concerning the borrower's ability to comply with the loan agreement; and
(3) Any other information requested by the board concerning the financial condition of the borrower and the benefitted entity.
The board may require that financial statements be audited at the expense of the benefitted entity, if the board reasonably believes the financial statements provided do not clearly or completely state the benefitted entity's financial condition, or are not prepared according to generally accepted accounting principles.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
Cross-Reference: Certified Public Accountants and Public Accountants, art 20:37.
70:05:03:10. Inspection of the borrower by the board and retention of records. During the term of the loan, the board or department may inspect the project and require the borrower to provide any books and records necessary to ensure compliance with the terms of the loan agreement. The borrower shall retain all its accounting and tax records for three years after all principal and interest on the loan has been paid.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 1-44-20, 49-16C-3.
70:05:03:11. Additional notification requirements. The borrower shall notify the board in a timely manner of any change in the rail operator or any other benefitted entity. If the notice required in this section is not provided, the board may call the loan immediately due and payable.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:12. Maturity and interest rate. The board shall set the maturity of the loan, and any interest rates, either fixed or variable, over the term of the loan.
The board may consider the following in setting the interest rate:
(1) State and national market interest rates;
(2) State and national economic conditions;
(3) The solvency and balance of the fund; and
(4) Other economic or business information determined by the board to be relevant.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3, 49-16C-4.
70:05:03:13. Review of financial status. The board or the department may conduct an overall review of the financial status of an applicant or borrower and any benefitted entity. The review may include an analysis of all assets and liabilities and an analysis of the ability of the applicant or borrower and any benefitted entity to service and honor the loan commitments.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 1-44-20, 49-16C-3.
70:05:03:14. Default on loan agreement. If the borrower violates any of the terms of the loan agreement, the board may place the borrower in default. Upon default, the board may declare due and payable the entire principal amount then outstanding and the accrued interest or take any other action provided by law which is considered appropriate by the board to protect its interests.
Source: 19 SDR 107, effective January 24, 1993.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 49-16C-3.
70:05:03:15. Delegation of administrative functions. The department shall perform the administrative functions for the creation, processing, and review of loan applications; the preparation, negotiation, and execution of agreements; the review of the financial status of an applicant or borrower and any benefitted entity; and other functions necessary to expedite the loan process and assist the board in the performance of its duties.
Source: 19 SDR 107, effective January 24, 1993; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 49-16C-3.
Law Implemented: SDCL 1-44-20, 49-16C-3.
CHAPTER 70:05:04
RAILROAD TAX CREDITS
Section
70:05:04:01 Deadline for submission of information for railroad tax credit -- Application form -- Information required.
70:05:04:01. Deadline for submission of information for railroad tax credit -- Application form -- Information required. A railroad seeking certification for railroad tax credits pursuant to SDCL 10-28-21.2 shall submit the following information to the department, on a form prescribed by the department, no later than June 1 of the year following the year in which the replacement, improvement, and repair of rail lines was completed:
(1) The name of the railroad;
(2) The total amount of qualifying capital expenditures incurred statewide for replacement, improvement, and repair of rail lines;
(3) A list of the counties where the replacement, improvement, and repair of rail lines took place;
(4) A description of the kind of work that was performed and an explanation of the purpose and justification for the work performed in each county;
(5) The date the work was begun and the date the work was completed in each county;
(6) The name of the line segment and the mile post markers corresponding to the starting and ending points of the work performed in each county;
(7) The amounts of the labor, material, and total capital expenditures incurred in each county;
(8) The amount of expenditures in each county that were funded with state or federal grant funds or paid for by any third party;
(9) A copy of the tax credit certification submitted by the railroad for each county where a tax credit is claimed; and
(10) A statement, signed by a person authorized to act on behalf of the railroad, certifying that all information provided is true and all documents submitted are authentic.
Source: 31 SDR 89, effective December 28, 2004; 49 SDR 47, effective November 21, 2022.
General Authority: SDCL 10-28-21.6.
Law Implemented: SDCL 10-28-21.6.
