USDA 

Unhed States 

-

Department of Agriculture 

SEP 2 0 2013 

The Honorable Daniel R. Elliott III 

Chairman 

Surface Transportation Board 

395 E Street, SW. 

Washington, D.C. 20423 

Office of the Secretary 

Washington, D.C. 20250 

RE: Finance Docket No. 35081 Sub. No.2, Canadian Pacific Railway Company, et al.-

Control-Dakota, Minnesota & Eastern Railroad Corporation. et al. 

Dear Chairman Elliott: 

This letter1 is in support of the petition of the State of South Dakota, acting by 

and through its Department of Transportation to enforce Canadian Pacific Railway 

Company's (CP) investment representations to the Surface Transportation Board (STB). 

On March 4, 2008, the U.S. Department of Agriculture (USDA) filed comments with 

STB in support of the merger ofCP and Dakota, Minnesota & Eastern Railroad 

Corporation (DM&E), which had interchanges with all seven major railroads. 

USDA provided its support of the merger on the condition that CP kept all current 

connections to these other railroads open at economically competitive and nondiscriminatory rates. USDA also encouraged CP to make sufficient investment 

in the former DM&E line to maintain or improve its condition. 

South Dakota is served by only two major railroads, the BNSF Railway Company and the 

former DM&E line, which is now operated by CP. The former DM&E line is the only 

east-west rail line that crosses the middle portion of the State. It has improved shippers' 

competitive access to markets in Chicago, the Pacific Northwest, Texas, and the eastern 

United States with its connections to all major railroads. The loss of this line, or major 

portions of it, could eliminate rail service to a major portion of the State. Even where 

service would remain, agricultural shippers would only have access to a single railroad, 

which could increase rail rates for agricultural shippers and receivers of corn, wheat, 

soybeans, ethanol, distillers, dried grains, flour, fertilizer, and seeds. This, in turn, could 

reduce farm income and increase truck traffic on rural roads and bridges. 

1 The Agricultural Adjustment Act of 1938 (7 U.S.C. § 129 1) and the Agricultural Marketing Act of 1946 

(7 U.S.C. 16210)) provide USDA authority to represent the interests ofthe agricultural shipping industry 

to the STB (and other Federal transportation regulatory bodies) with respect to rates, charges, tariffs, and 

practices relating to the transportation of farm products. 

An Equal Opportunity E~r 
The Honorable Daniel R. Elliott III 

Page 2 

Investment in the former DM&E line is therefore critical to serve the needs of 

agricultural shippers and receivers. 

It is important to enforce the investment represe.ntations with regard to the former 

DM&E line, particularly for the line west of Tracy, Minnesota. This portion of the 

line could be sold without connections to other major railroads, resulting in a large 

portion of South Dakota's agricultural producers losing cost-effective rail service or 

having access to only one major railroad with higher rates. A full accounting of the 

promised investment, as requested by South Dakota, is a reasonable step forward. 

Sincerely, 

~&· Secretary 

~l-"'