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The Dakota, Minnesota & Eastern Railroad Corp. (DM&E) still is awaiting word from the Federal Railroad Administration (FRA) on a $2.3 billion federal loan that would help finance the railroad’s proposed Powder River Basin project. And the Rochester Coalition — which includes the Mayo Clinic and city of Rochester, Minn. — continues to oppose the project.

But that isn’t stopping the railroad from taking a “calculated risk” by entering into an agreement with Corselab Structures Inc. to build a manufacturing plant in Rapid City, S.D., that would supply pre-stressed and precast concrete bridge components for the project, the DM&E said.

“In a perfect world, the project would be fully approved and committed before we made this kind of investment,” said DM&E President and Chief Executive Officer Kevin Schieffer in a prepared statement. “But because of the size of the project and the number of component parts required, plant construction has to begin now in order to be able to produce enough parts to build the line.”

DM&E and Coreslab expect to begin construction by year’s end and complete the plant in June 2007. The parties currently are procuring cranes and other equipment. The railroad will need more than 750 bridge girders for the project, which calls for building a 262.3-mile line through western South Dakota and eastern Wyoming, and upgrading 600 track miles in South Dakota and Minnesota.

Meanwhile, the Rochester Coalition last week asked a U.S. 8th Circuit Court of Appeals to remand the Surface Transportation Board’s (STB) February decision that granted the DM&E final project approval.

Coalition members claim the STB’s environmental review of the project has not gone far enough, is based on a dated Environmental Impact Statement (EIS) and failed to consider the Iowa, Chicago and Eastern Railroad Corp.’s (IC&E) lines. The STB should extend a National Environmental Protection Act review to the DM&E’s/IC&E’s entire 2,500-mile network and evaluate the environmental and public safety risks associated with the DM&E's plan to move ethanol and chemicals along the new lines, the coalition said.

In addition, coalition members believe the FRA should consider the loan application incomplete until the court challenge is resolved.