Sioux Falls reaches deal to purchase BNSF rail yard for $27 million

The city of Sioux Falls, S.D., plans to use more than $27 million in federal highway funds to purchase a downtown rail yard from BNSF Railway Co.

City officials yesterday announced that negotiations had concluded and that a purchase agreement would now be considered by the Sioux Falls City Council on Aug. 4.

"This monumental achievement for our city certainly has been a long time in the making, but the effort by so many has now paid off in a huge way," said Sioux Falls Mayor Mike Huether. “With the agreement on the terms of the sale, we are a giant step closer to redeveloping that critical piece of our downtown."

The agreement calls for removing the majority of the rail yard in downtown and opening more than 10 acres of property for redevelopment, Sioux Falls officials said. BNSF will construct two siding tracks along a mainline track north of Rice Street and west of Timberline Road, and maintain two mainline tracks though the city's downtown area.

If the agreement is approved by the city council, Sioux Falls will take full possession of the property in two years, following BNSF's completion of the siding tracks.