photo credit: South Dakota Department of Transportation
| Location | Presho, South Dakota |
|---|---|
| Project Sponsor / Borrower | Lyman County, South Dakota |
| Program Areas |
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| Value Capture Techniques | Tax Increment Financing |
| Mode | Local Road |
| Description | In August 2019, the South Dakota Transportation Commission approved a state loan to Lyman County for $2.3 million to rebuild a portion of County Road 14 to provide access from area routes - including State Highway 248, US 183, and I-90 - to the new Dakota Mill and Grain (DMG) grain-loading rail terminal, in Presho, South Dakota. The rebuilt gravel road, including one bridge, will allow better access for trucks to reach the DMG rail terminal in Presho. The current road is narrow, and the bridge does not adequately accommodate the weight of trucks loaded with grain. The loan is to be repaid to the South Dakota DOT by Lyman County using a tax increment financing (TIF) district, the first in the county. The tax increment that will repay the load derives from the increased property value of the new grain-loading facility and other properties within the district. The need for the access road was stimulated by two TIGER Grants to the Mitchell to Rapid City (MRC) branch rail line. The MRC line, rehabilitated in 2014, allows farmers to easily export their grain across the country. Rehabilitation of the line removed trucks from state highways and put the grain on rail, and a Dakota Southern / BNSF Shuttle Load partnership allows the railroad and shippers to team up and load larger trains, which dramatically improves efficiency. Since the MRC Line was rehabilitated, over $115 million in new grain handling facilities, fertilizer storage, and agronomy centers have been built. These investments have significantly enhanced opportunities for farmers to bring their products to market throughout the state but have required improvements to roads accessing the rail terminals. |
| Cost | $2,878,515 (construction cost, design and construction management services, 10% contingency, and 6% administrative/legal) |
| Funding Sources | South Dakota DOT Agri Business Grant - $600,000 South Dakota DOT State Highway Fund Loan for Local Governments - $2,278,515 |
| Project Delivery / Contract Method | Design-bid-build |
| Private Partner | None |
| Project Advisors / Consultants | To be determined |
| Lenders | South Dakota Transportation Commission |
| Duration / Status | Construction is expected to start November 2019 and be substantially complete in September 2020. |
| Financial Status | The state highway loan has been made, and the TIF district in Lyman County has been created to payback the loan. Dakota Mill and Grain is responsible for any shortfall that may occur if the TIF revenue is not sufficient to cover the debt service. The terms of the loan call for amortizing the loan over 20 years, with a balloon payment in 10 years, and no interest until construction is complete. |
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| Contacts | Ben Orsbon |
