Voters could decide whether Onida will have an ethanol plant

Farm Forum

Sully County can begin receiving absentee ballots on a zoning change that has been referred to voters and is heading for a June 16 countywide vote.

Though the vote is technically an attempt to roll back a zoning change for a parcel of property at the southeast corner of town, the issue behind the zoning change is that the property owner wants to sell the parcel to an ethanol company. The ethanol company can build the plant only if the property is rezoned, and even then, it must seek a conditional use permit.

The Sully County Planning and Zoning Commission initially, and the Sully County Commission subsequently, approved the zoning change at a series of meetings in February and March.

But opponents gathered about 100 signatures in order to refer the County Commission’s action to a public vote.

Sully County Auditor Susan Lamb said only 53 signatures were necessary to refer the issue, or 5 percent of the 1,060 voters who were registered at the county’s last general election in November 2014. It will take a simple majority to decide the issue, Lamb said. She said turnout could be high, even though it will be the lone item on the ballot.

“We’re hoping that we get over 50 percent,” Lamb said.

What’s at stake

Rezoning the 42.5-acre parcel from Agriculture District B to Agriculture District A would allow some carefully defined conditional uses on the property, including “commercial crop processing plants.”

Oahe Grain Corp. of Onida is the owner of the property and has requested the zoning change. It wants to sell the property to ethanol company Ring-Neck Energy and Feed LLC, which wants a location near Onida.

Ring-Neck Energy and Feed LLC had an option to buy the property that was to expire April 1 but has been extended, given the pending vote on the zoning issue, said Oahe Grain Corp. General Manager Tim Luken.

Ring-Neck Energy wants to build a plant that would process grain from as far as 100 miles away – mostly corn, but perhaps also milo.

The plant would cost $120 million or more to build, would require about 40 employees and would produce about 70 million gallons of ethanol a year, company executives have said.

Economic impact

Luken, who has a better handle on what Sully County grows than most people, said he estimates the economic impact of the ethanol plant could add, conservatively, about 13 cents per bushel to what farmers get for their corn. Since Sully County normally grows about 100,000 acres of corn and has yields of about 120 bushels to the acre, that’s 12 million bushels, each generating about 13 cents extra for the county – an additional impact of $1.5 million.

But others besides farmers will benefit because of the added jobs, both during construction and then once the plant is in operation, he said. And the additional workers will help the real estate market, he said.

“It’s going to help home values in our communities, whether it’s Onida, Blunt, Gettysburg, Highmore, Harrold,” Luken said.

Petitioners optimistic

But homeowners such as Clark Guthmiller, who is among those who have circulated petitions to try to roll back the zoning change, are not convinced that an ethanol plant at the southeast doorstep of Onida will be a positive thing for all homeowners.

“I definitely think that the homes that are going to be downwind of a south or southeast wind, I believe those properties would be negatively affected,” Guthmiller said.

Guthmiller said all the other 15 ethanol plants in South Dakota appear to have been placed outside the immediate vicinity of residential neighborhoods. Guthmiller – who has stressed that he is not opposed to the ethanol plant, only to the proposed location just outside Onida, next to where he lives – said it was easy to gather the signatures to refer the issue to a county vote. He suggested that could be a hint of the possible outcome.

“We wouldn’t be at this stage if we weren’t somewhat optimistic,” Guthmiller said.


Walt Wendland, one of the entrepreneurs of Ring-Neck Energy, said the county vote won’t slow the project down too much because the company is moving ahead with what it can do without the zoning change. It is finalizing its bid specifications and doing soil borings in the areas where silos, fermenters and other heavy equipment would be located.

“It’s really not going to change the timeline very much,” Wendland said. But he noted that because the company would have to seek a conditional permit, even if the voters back the county in approving the zoning change, it would probably be mid to late July before the actual work could get started.

Wendland said Ring-Neck Energy has reserved the Onida school gymnasium for a public meeting at 7 p.m. on Wednesday, May 13. He’s lining up the speakers now to help the company make its case for the project, Wendland said, adding it will be critical to convince people to come out and vote. He said a danger would be if some county residents who support the project take it for granted that it’s going to pass and don’t bother to go to the polls.

Wendland said Onida is unusual in that it has good rail access, water, natural gas, electricity, grain-handling infrastructure and lots of grain in the immediate area.

“I don’t think there’s another area as good as this that doesn’t already have an ethanol plant,” he said.

That message may be hitting home. Wendland said about 38 to 40 farmers in the area already have invested in the project in its first round of fund-raising.

“They’ve raised the money to take the project to the next level,” he said.