Local Infrastructure Projects and Railroads
Overview
I am continuing the journey through what I view as the “Top 10” developments in agricultural law and taxation during 2025. With this article I take a look at number nine – a key case from Iowa involving local infrastructure projects and railroads.
The Iowa Northern Railway Case
For decades, railroad companies have used federal law as a “blanket veto” to block local infrastructure projects. Whether it’s a new water main, a fiber optic cable, or a drainage culvert, railroads often claim that any work on their right-of-way is “preempted” by federal authority.
In a landmark victory for rural landowners and local governments, the Iowa Supreme Court recently pushed back. Its decision in Iowa Northern Railway Co. v. Floyd County Board of Supervisors, No. 24-0509, 2025 Iowa Sup. LEXIS 102 (Iowa Sup. Ct. Dec. 19, 2025). clarifies that railroads are not sovereign territories exempt from state responsibility.
Facts of the case. The dispute centered on Joint Drainage District Nos. 6 and 56. To prevent upstream flooding on productive Iowa farmland, the District needed to replace a deteriorating 1870s stone culvert with a modern 66-inch steel pipe.
To minimize disruption, the District planned to use “jack and bore” technology—a trenchless method that installs pipe deep underground without stopping trains or cutting the tracks. Despite this, Iowa Northern Railway sued, arguing that the Interstate Commerce Commission Termination Act (ICCTA) gave the federal government exclusive jurisdiction, meaning the county had no power to order the work.
Court’s holding. The Iowa Supreme Court reversed lower court findings, establishing a high bar for railroads to block local projects. The Court held that the ICCTA does not “categorically” preempt state drainage laws. State “police power” – the duty to manage public health and infrastructure – still applies to railroad property. A project is only preempted if it “unreasonably burdens” rail operations. Since the District used industry-standard trenchless methods, any delay was merely “incidental.” Thus, railroads can no longer just say a project is “inherently unsafe” to stop it. They must provide concrete evidence of significant operational disruption.
Relevance of the Court’s Decision
In the Midwest, drainage is economic life. If a railroad embankment acts as a “dam,” it can destroy the value of thousands of acres of private property. Drainage districts and Boards of Supervisors now have a clear legal path to compel railroads to maintain or upgrade culverts under Iowa Code § 468.109. But the court’s opinion isn’t just about water the court’s approval of trenchless “jack and bore” methods provides a legal roadmap for expanding high-speed fiber, water mains, and gas lines across the state. The ruling also aligns Iowa with federal circuits that protect state laws of “general application.” It prevents the ICCTA from being “stretched” to cover every minor pipe or property dispute.
Observation: Interestingly, Court’s decision creates a distinction between subsurface infrastructure and train operations. While courts generally strike state laws that fine railroads for blocked crossings (because telling a railroad when to stop a train directly regulates “core operations”), the Iowa Supreme Court ruled that a drainage pipe is different. A pipe doesn’t dictate how a railroad runs its business; it simply requires the railroad to be a responsible neighbor.
Conclusion
The Iowa Supreme Court has sent a clear message: Federal law was intended to protect interstate commerce, not to turn railroad tracks into dams that flood private property. For rural Iowa, this is a major win for property rights and modern infrastructure.