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Contentious Drainage Issue Comes To A Close On Split Vote

By Staff | Apr 28, 2009

The split vote of the Palo Alto County Board of Supervisors on April 21 brought a final closure to a contentious drainage annexation dating back to 2005. The vote closes a long, difficult chapter pockmarked with court challenges that ended up in the Iowa Court of Appeals last year.

After a public meeting a month ago at the Palo Alto County Election Center, the supervisors have been discussing and weighing their options in regards to the appeals court ruling in the case of Drainage District 80 and the Upper Cylinder Creek Watershed objectors. The litigation in the case dates back to the annexation of lands into DD80 in 2005. At that time, a group of eight 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.

After the conclusion of that original public hearing in 2005, an additional 124 landowners signed a petition requesting that they too be allowed out of the annexation. In accordance with Iowa Drainage law, the initial eight 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 also ruled the other 124 petitioners should be let out of the district along with the original eight objectors. Palo Alto County appealed that ruling, which then sent the case to the Iowa Court of Appears, who heard the case late last year and upheld the findings of the second district court verdict, which released all 132 objectors from the district.

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 involved the litigation, paid the assessments. Along with the costs of the annexation and reclassification, legal expenses for the three court challenges have brought the total indebtedness of the district to around $85,000.

With the county’s legal counsel, Attorney James Hudson, Jr., agreeing that the initial eight objectors who paid their assessments should be refunded those payments, Hudson and his father, who tried the original appeals, did not feel that those landowners in the group of 124 petitioners should be refunded their payments, as they did not agree that the 124 petitioners were excused from the district.

For the supervisors, the discussion on Tuesday revolved on bringing the issue to a close, once and for all.

Board Chair Ed Noonan opened the discussion by asking the board’s feelings. The board was in agreement that the initial eight objectors who had paid their assessments should have those payments refunded.

Discussion then moved to what rate of interest to pay on stamped warrants that would be used to make the refunds. Supervisor Ron Graettinger questioned leaving the interest rate at the current six and half percent. “Do we have to stay at the six and a half percent? Interest rates on everything else are way down.”

“I agree with Ron,” noted Noonan.

“I’d move we issue stamped warrants at three percent interest for these stamped warrants,” Graettinger moved. Supervisor Leo Goeders seconded the motion, which received unanimous approval from the board.

Supervisor Jerry Hofstad then moved to issue stamped warrants to the original eight objectors in DD80 who had paid their assessments. Noonan seconded the motion, which received unanimous approval from the board.

Discussion then turned to the other 124 petitioners.

“It has been decreed by a judge and by the Court of Appeals,” Hofstad said. “We have no choice.”

“I have no problem with the original eight, but the others didn’t file their objections correctly, that’s how I feel,” Graettinger spoke up.

“If you don’t pay those people back, you could be held in contempt of court,” County Auditor Gary Leonard warned the board members.

“Or we could be sued by the others again,” Noonan added.

County Treasurer Mary Hilfiker spoke up. “Our feelings are not the determining factor here. You have an appellate court ruling that you have to abide by.”

After a few moments of silence, Goeders moved to make refund payments to those of the additional 124 objectors through stamped warrants at three percent interest, based on the Dec. 17, 2008 Iowa Court of Appeals ruling. Hofstad offered a second to the motion, and Noonan called for a roll call vote.

Hofstad voted aye, but Graettinger cast a nay vote, adding, “Those folks belong in the district. I can’t go along with letting them out.”

Goeders cast an aye vote, but Supervisor Keith Wirtz also cast a nay vote. “They belong in the district.”

With the vote tied at 2-2, Noonan, as the chair, cast the final deciding vote. “They belong in the district, but I vote aye to try and avoid any future lawsuits over this.”

With the 3-2 vote recorded, Noonan declared the motion passed, bringing the issue to a conclusion.