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Earlier this month, South Dakota Gov. Mike Rounds authorized the state's transportation department to enter into agreements to fund improvements to three state-owned rail lines.
 
The total of $10.7 million in funding would be repaid by a $20-per-car surcharge on freight hauled on the lines. Although the funding essentially is in the form of loans, repayment is based on the number of rail cars moving on the lines and no interest will be charged, Rounds said in a prepared statement.
 
"The goal for these projects is to improve safety, reduce shipping costs and make the state-owned lines more attractive to industries that need rail access," he said.
 
The proposed agreements will be offered to the regional railroad authorities that lease the lines from the state. South Dakota will provide $7.6 million to improve a portion of a 67-mile Canton-to-Elk Point line leased to Sioux Valley Regional Railroad Authority and operated by the D&I Railroad. The project includes the installation of about 14 miles of welded rail.

The state DOT also will provide $2 million to improve the 76-mile Britton line between Aberdeen and Geneseo Junction that's leased to the Marshall County Regional Railroad Authority and operated by the Dakota, Missouri Valley & Western Railroad Inc. In addition, the DOT will provide $1.1 million to improve the 15-mile Huron-to-Yale line that's leased to the East Central Regional Railroad Authority and operated by the Dakota, Minnesota & Eastern Railroad Corp.