Iowa Gov. Kim Reynolds vetoed a bill Wednesday that would have made it more difficult for companies to use eminent domain to build carbon capture pipelines and other energy infrastructure.

In her veto message, Reynolds said the bill is not just about eminent domain.

“It goes much further — and in doing so, sets a troubling precedent that threatens Iowa’s energy reliability, economy and reputation as a place where businesses can invest with confidence,” she said.

Reynolds said the bill’s insurance mandates and 25-year permit limit would even block pipeline projects that use only voluntary agreements with landowners.

“I understand this was not the intent,” she said. “Those who crafted the bill said they don’t want to stop CO2 pipelines that rely entirely on voluntary agreements. But that is exactly what the bill does. For that reason alone, I cannot sign it.”

Reynolds also raised concerns about the bill’s changes to permitting rules for other types of pipelines, including those that transport oil, gas and fertilizer. She also said the bill would put Iowa at a competitive disadvantage for biofuels production as other Midwestern states move forward with carbon capture projects.

She said she is “committed to working with the Legislature to strengthen landowner protections, modernize permitting, and respect private property.” In the meantime, Reynolds said she is asking Iowa Utilities Commission members to be present for live testimony and informational meetings, which would have been required by the bill she vetoed.

House Speaker Pat Grassley, R-New Hartford, said he has asked House members to sign a petition to hold a special session to override the governor’s veto.

“This veto is a major setback for Iowa,” Grassley said in a statement. “It is a setback not only for landowners who have been fighting across Iowa, but for the work the House of Representatives has put in for four years to get legislation like HF639 passed. We will not stop fighting and stand firm on our commitment until landowners in Iowa are protected against eminent domain for private gain.”

Lawmakers can override a veto if two-thirds of the members of each chamber vote to pass the bill again.

Senate Majority Leader Jack Whitver, R-Grimes, said he supports Reynolds’ decision.

“Based on the votes on that bill in the Iowa Senate, a significant majority of our caucus supports a better policy to protect landowner rights,” he said. “I expect that majority of our caucus would not be interested in any attempt to override her veto.”

Iowans who oppose the use of eminent domain for the Summit Carbon Solutions carbon capture pipeline have fought for years to get a bill passed that would prevent the company from acquiring land from unwilling landowners in its path. State utility regulators gave Summit Carbon Solutions conditional approval last year to use eminent domain for the project.

This year, 12 Republican senators defied their leaders and forced a vote on a bill aimed at further restricting eminent domain and pipeline projects. After a contentious, late night debate in which GOP senators publicly argued with each other about the potential impact of the bill, 13 Republicans joined with 14 Democrats to pass it.

Senate Democratic Leader Janice Weiner of Iowa City said she was disappointed by the veto but not surprised.

“There is simply no amount of political posturing or legislative stonewalling that can deny the fact that Iowans’ right to private property should never be infringed upon for private gain,” she said.

House Minority Leader Brian Meyer, D-Des Moines, said Reynolds sided with her political donors rather than Iowa landowners.

“Iowa House Democrats and Republicans worked together to protect property rights,” he said. “At the end of the day, there is only one group to blame for the failure of the eminent domain bill: Iowa Republican lawmakers.”

Summit Carbon Solutions thanked the governor for her “thoughtful and thorough review of the bill.”

“We look forward to continued discussions with state leaders as we advance this important project,” Summit’s statement reads. “At a time when farmers are facing increasing pressures, this project opens the door to new markets and helps strengthen America’s energy dominance for the long term.”

Supporters and opponents of the bill have disagreed about its impact

The Summit Carbon Solutions pipeline would transport carbon dioxide emissions from ethanol plants in Iowa, Nebraska, South Dakota and Minnesota to be sequestered underground in North Dakota. Biofuels producers have said the project is needed to create new markets for low-carbon fuels, which they said would increase demand for corn and boost Iowa’s economy.

Monte Shaw, executive director of the Iowa Renewable Fuels Association (IRFA), thanked Reynolds for vetoing the bill.

“Any thoughtful review of this bill would determine that it would lead to higher energy prices for Iowans, hamper future economic development, hold back job creation and stifle new markets for Iowa farmers,” he said. “IRFA thanks Gov. Reynolds for listening to Iowans, studying the actual legislation and ignoring the rhetoric that was as inaccurate as it was loud.”

Shaw said the bill would not have enhanced property owner rights, and that it simply sought to kill carbon capture pipelines.

Landowners facing the use of eminent domain have said the bill wouldn’t stop any pipelines — but it would have leveled the playing field for affected landowners and their neighbors.

Mary Powell, an affected landowner from Shelby County, said last month the bill was a reasonable, common sense measure to help protect Iowans’ rights to have control over their land.

“The issue at hand is not a partisan issue,” she said. “It’s not about Democrats or Republicans or who has the most money to push through their private agenda for private gain. It’s about taking a stand and protecting the rights of Iowans. It’s about holding the pipeline companies and those in public office accountable.”

Rep. Charley Thomson, R-Charles City, said he wrote the bill. He recently wrote on Facebook that the bill is “a relatively tepid first step toward fixing Iowa’s broken pipeline permitting system.”

“The entire CO2 pipeline project is based on lies, so I’m not the least surprised that the CO2 pipeline crowd launched a blizzard of lies in their attacks on HF639,” he wrote.

What would the bill have done?    

The bill says a hazardous liquid pipeline can only use eminent domain if it is a common carrier, which is defined as transporting a commodity for entities not affiliated with the pipeline company.

A company seeking to use eminent domain would have to establish “by clear and convincing evidence that the proposed use meets the definition of a public use, public purpose, or public improvement.”

The bill would have established insurance requirements for hazardous liquid pipelines that would’ve included coverage for landowners who couldn’t get insurance or whose premiums rose as a result of the pipeline.

Pipelines transporting carbon dioxide would have also been prohibited from operating for longer than 25 years, and the Iowa Utilities Commission (IUC) would’ve not be allowed to renew a permit granted to a carbon pipeline.

The bill would have put in place requirements for IUC members to attend hearings and informational meetings regarding the proposed use of eminent domain — something Reynolds said she is asking ICU members to do. It would’ve specified who could intervene in IUC proceedings, and limited the situations in which the IUC could impose sanctions on interveners.