DM&E responds to financial feasibility study

The DM&E spared little time in responding to a study commissioned by the Mayo Clinic questioning the railroad's ability to repay a proposed government subsidized loan for the railroad's expansion. Unfortunately, the press release from the DM&E did not directly address the points raised in the study. Rather, it attacked the Mayo Clinic, the City of Rochester, Olmsted County and the coalition that are all fighting the route through Rochester.

There is something fishy going on when a rebuttal dodges the questions raised by legitimate research. It appears that the DM&E doesn't want to debate the financial merits of its proposed expansion. Does this mean that taxpayers will be left with holding the bag on a worthless loan while DM&E CEO Kevin Schieffer and the railroad's investors make out like bandits?

You be the judge:

NEWS from DM&E
8 May 2006

DAKOTA, MINNESOTA & EASTERN RAILROAD CORPORATION
140 North Philips Avenue, * Sioux Falls, SD 57104 * 605-782-1200/Fax 605-782-1299

FOR IMMEDIATE RELEASE

MAYO-FUNDED DM&E STUDY ANOTHER IN LONG LINE OF FLOPS
History of non-credibility creates little cause for concern

SIOUX FALLS ­ — In response to press inquiries concerning a study funded by Mayo Clinic and the city of Rochester, DM&E president and CEO Kevin V. Schieffer today said he is not concerned about the most recent Mayo claims. "I obviously haven't had a chance to review the latest claims made by Mayo and Rochester, but based on past history it gives us very little reason for concern." Schieffer noted that Rochester and Mayo have presented countless and expensive studies in the past, all of which have been unanimously rejected by objective experts. Schieffer recounted some examples of past Mayo/Rochester-funded "studies":

• Mayo/Rochester-funded marketing study claiming DM&E couldn't attract sufficient traffic to support the project was rejected.
• Mayo/Rochester-funded study suggesting the viability of a `by-pass' was rejected.
• Mayo/Rochester-funded claim suggesting the project would result in clouds of coal dust was rejected.
• Mayo/Rochester-funded study suggesting the DM&E project would create unacceptable levels of vibration was rejected.
• Mayo/Rochester-funded studies suggesting the project exceeded permissible noise levels were rejected.

Mayo and Rochester have firmly established themselves as non-credible sources of information, and as easy targets for consultants. "We will review this latest in a long series of claims by a Mayo/Rochester-funded "study", but based purely on their track record of rejected claims, we are not concerned by this latest claim," said Schieffer. "It does, however, amaze me that Rochester can continue to spend taxpayer dollars on this kind of thing, and that the supposedly non-profit Mayo clinic is allowed to use its unlimited, tax-free resources to attack a project that has the overwhelming support of the states affected. Given that their latest claims pretend to be made on behalf of taxpayers, perhaps it's time to look more closely at who is paying for what here." The DM&E project is supported by 55 of the 56 communities served by DM&E, and the overwhelming majority of agriculture and economic development organizations in Minnesota and South Dakota. Mayo and Rochester are trying to kill the project with taxpayer money and tax exempt donations.