Budget writers derail plan seen as bailout for Hoeven's bank

JAMES MacPHERSON
·2-min read

BISMARCK, N.D. (AP) — Budget writers in the Republican-controlled North Dakota House want to derail legislation to save a troubled shipping facility, after criticism that the move was a bailout for banks, including one owned by GOP U.S. Sen. John Hoeven.

Five Minot-area lawmakers sponsored the legislation for the intermodal shipping facility that sought to provide $8.2 million that would be funneled to a trio of banks — including Hoeven’s — that acquired the facility in the senator’s hometown through foreclosure.

North Dakota's House Appropriations Committee late Wednesday amended the bill to remove the money that would go to the banks and instead provide a loan of up to $2.5 million for track improvements for the facility. The 20-member committee was nearly unanimous in balking at the idea of a bank bailout.

The full House likely will vote on the amended legislation next week.

The original plan received near unanimous approval in the Senate, but several senators later said they were unaware of the specifics of the legislation, including its ties to Hoeven, until The Associated Press published stories about it. Hoeven also said he did not know about the bill until the AP asked about it last month.

If the amended bill passes the House, it would go back to the Senate for review. Its final details likely will be negotiated by a House-Senate conference committee.

The original legislation would have allowed an economic development group to buy the Minot shipping facility from the three banks that bought its assets through foreclosure — the state-owned Bank of North Dakota, First Western Bank and Trust, and the State Bank and Trust of Kenmare.

Hoeven, who served as North Dakota’s governor from 2000 to 2010, is part owner and serves on the board of directors of First Western, which was started by his father. He’s also a former president of the Bank of North Dakota, the nation’s only state-owned bank.

The original bill sought to give the Bank of North Dakota a 49% share of the buyout, First Western 34% and the State Bank and Trust of Kenmare the rest.

Supporters of that plan said they believe the Minot facility will reduce shipping costs and increase markets for the state’s farm products and other commodities.

An effort to establish an intermodal facility in North Dakota has been ongoing for at least two decades but has never fully materialized. Intermodal service involves standardized containers that can be carried on trains, trucks and ships to international markets, allowing products to be moved between different types of transportation without being repacked.