The Iowa Supreme Court ruled Friday that county officials failed to follow state law when preparing to condemn more than 2,000 acres of farmland to build a lake, a decision that puts government agencies on notice that mistakes in eminent domain cases could be costly.
Owners of the farmland near Osceola challenged the Clarke County Reservoir Commission’s plan to condemn the property to build the 800-acre lake to provide a new drinking-water source for the area.
The high court’s ruling sends the case back to district court, where a farming family will continue its challenge of the project and perhaps insist that the commission start the process from the beginning with notifications and public hearings.
David Brown, an attorney for a family trust that owns part of the land, said the case is important because major crude-oil pipeline and wind-energy transmission line projects are pending before the Iowa Utilities Board, which has yet to determine whether eminent domain may be used to force landowners to sell farmland for the projects.
“The rules matter because it’s the little guy against city hall,” he said. “You’ve got to follow procedures to a “t” because it’s an enormous use of government power.”
The reservoir commission initially included several city governments, the county, local water associations and the Clarke County Development Corp., a private economic development group, which does not have eminent domain authority. The commission in 2012 sent required notices to property owners, held public hearings and began the process of condemning land.
The family trust set up by Edwin and Deloris Robins sued, saying the commission could not lawfully exercise eminent domain because it consisted of a private agency that did not have the authority under Iowa law to do so. The commission later reorganized without the economic development group.
The family also challenged whether the reservoir was a legitimate public use. As originally designed, the lake, which is expected to cost more than $37 million, was to provide drinking water and serve as an area recreational attraction. The trust alleged the lake was primarily being built for recreational use and its stated purpose as a drinking-water source was false. The commission later removed the recreational use portions of the project and a judge ruled the lake was a legitimate public use project and qualified for eminent domain.
The trust’s attorney, Brown, asked the court to throw out the entire process, make the commission start over again, and allow the trust to again challenge the legitimacy of the public purpose. The high court agreed.
“We’re dealing with a very fundamental right here, taking property from people,” Chief Justice Mark Cady said during arguments in February.
“When we’re dealing with a right of this nature isn’t it important for the public to see government work the way it’s supposed to work?” he said.
Ivan Webber, the attorney for the commission, did not immediately return messages.
During February arguments he asked the justices to allow the project to move forward without starting over. He said all commission members now have eminent domain authority, curing the problem and rendering the challenge moot.
“It’s been fully litigated and fully decided,” he said. “We have a county here already out of water. Let’s get rid of the problem and move forward.”
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