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Meeting Leaves Unanswered Questions

By Staff | Mar 19, 2009

EXPLAINING THE CASE – Palo Alto County Drainage Attorney James C. Hudson explains the facts of two recent court cases involving Drainage District 80 during an informational meeting Tuesday at the county’s Election Center in Emmetsburg. Over 80 landowners in the district were on hand to ask questions about the litigation and levies on the lands in the district. -- Dan Voigt photo

The annexation of 45,000 acres, including Five Island Lake continues to create problems for Palo Alto County Drainage District 80, nearly four years after the annexation took place. A pair of court challenges tied up an initial levy on the district, and decisions on those cases were discussed Tuesday afternoon in a meeting of the district landowners and officials at the Palo Alto County Election Center.

But, after some two hours of explanations, definitive answers to several basic questions continued to elude those in attendance.

When the annexation of lands into DD80 was carried out in 2005, a group of seven individuals, known as the Upper Cylinder Creek Watershed, filed written objections during the annexation hearing, requesting to be let out of the district on the basis that their lands, totaling some 18,000 acres, received no benefit through the annexation. The Palo Alto County Board of Supervisors, acting as trustees of the drainage district, overruled the objections at that time.

Following the public hearing in 2005, an additional 124 landowners also signed an objection to the annexation. In accordance with Iowa Drainage law, the initial seven objectors took their dispute to the district court where the objectors lost their case. An appeal was filed and a second bench trial overturned the original verdict, and ruled the other 124 objectors should be let out of the district along with the original seven objectors.

The Iowa Court of Appeals then heard the case late last year and upheld the second district court verdict, releasing the objectors from the district.

The second issue for the district included the addition of Five Island Lake into the district.

However, the Iowa Department of Natural Resources, which claims ownership of lakes, filed an appeal of the assessment on Five Island Lake, claiming that legal notice of the annexation was not properly presented to the DNR. In a bench trial on that issue, the DNR won, negating the levy and leaving DD80 holding a $96,000 levy that would not be paid.

The dilemma facing the district and its trustees concerns the outstanding bills against the district due to the annexation and reclassification work on the district. An initial levy was placed on the annexed district, and several landowners, including some of those in the litigation, paid the assessment.

While no actual construction was done, engineering and legal fees for the annexation, public notices, hearings and the subsequent court challenges now add up to $85,000 and continue to grow, with interest.

In Tuesday’s meeting, Drainage Engineer Don Etler explained the history of the district and the annexation, but many people in the crowd kept asking the same question, why wasn’t the lake being considered as part of the district?

“The water from my land drains to the lake,” noted Jim Hobart. “According to the court, since the lake doesn’t have to pay to drain into DD80, then why do I have to?”

The county’s drainage attorney, James C. Hudson of Pocahontas couldn’t answer that question.

“This isn’t an issue of whether the lake drains into DD80, it is an issue where the DNR claims they did not get proper notice of the annexation. We provided all of the notices and procedures we have used for years as evidence and we believe we did provide proper notice.” Hudson said. “I find it interesting that you have 120 days to object to an annexation under drainage law, but the state finally objected to it 18 months later.”

Hudson told the group that it is his belief, along with the supervisors, that they will have the opportunity to annex the lake in the future.

“We have visited with State Senator Jack Kibbie and State Representative Marcie Frevert, and they are on board with us and in agreement that the state needs to pay its assessment on the lake, but they are also being pressured the other way by the DNR,” Hudson noted.

Palo Alto County Supervisor Keith Wirtz noted that State Representative Delores Mertz of Ottosen is also following the issue closely. “Delores Mertz feels very strongly that the DNR needs to pay this assessment and she is not happy about them trying to get out of it. Personally, I feel very strongly that the lake should pay. They’re paying at Rush Lake on a deal just like this, so why shouldn’t they do it here?”

Board Chair Ed Noonan agreed. “The board is pretty much in agreement that we’re going to pursue this issue with the lake. We’re going to go after them on this.”

Regarding the second litigation over the Upper Cylinder Creek Watershed, a question was asked whether the original seven objectors would get their initial levy payments refunded due to the court ruling.

Hudson replied that would be the case, with Palo Alto County Auditor Gary Leonard pointing out that the refunds would be paid through stamped drainage warrants earning six and a half percent interest.

“But what about the other 124 objectors?” an audience member asked.

Hudson stated that it was the district’s opinion that the ruling for summary judgment in the original court case, excluding the 124 additional objectors, was final and binding.

Attorney Robert Goodwin of Ames, counsel for the original seven objectors, disagreed with Hudson’s opinion.

“Our contention is that all 131 objectors are out of the district, because the original notice of the annexation did not advise of the consequences of failure to timely object,” Goodwin stated. “And, the Court of Appeals ruled there was not a material benefit to these folks, so they should be entitled to refunds if the paid their levies as well. I’m convinced all 131 people are proper plaintiffs in this case.”

“So we have two differing opinions on this issue,” observed Terry Neary of Emmetsburg.

“The Court of Appeals is the ultimate authority,” Goodwin answered.

“We feel otherwise,” Hudson said.

“This seems to be a pretty black and white deal to me,” stated Cylinder farmer Jim Kuecker. “It went before the high court.”

“I would recommend that Mr. Goodman and I discuss this more and try to come to some form of an agreement,” Hudson said.

“How about we get the judges in this to come here and explain their reasoning?” Linus Solberg suggested.

“That will never happen,” Hudson said, as the audience chuckled.