Iowa Supreme Court allows flood victims’ case against state to go forward

Property owners in the Northeast Iowa city of Denver who were flooded out in 1999 following the construction of a highway bridge will soon have their day in court.

The Iowa Supreme Court ruled Friday that although lower courts had granted the state immunity to the tort claim brought by several property owners, the state could be held liable in part because it violated state and federal mandates that require prior environmental approval before new construction can be done in a floodway.

The core of the case brought by the landowners is the 1994 construction of a bridge as a part of the relocation of State Hwy 63 to bypass the city of Denver, located in Bremer County. The plan called for the construction of a four-lane, divided road along the west side of the city and a bridge that would span Quarter Section Run Creek, which flowed through the city.

A flood insurance study commissioned by the city in 1990 had designated the creek as a “regulatory floodway,” which required both the creek and adjacent flood plain to be kept free of encroachment “so that [a] 100-year flood can be carried without substantial increases in flood heights.” Due to the designation, Iowa law prohibits the erection of a structure or obstruction unless a permit is first granted by the Iowa Department of Natural Resources.

Working without such a permit and allegedly without knowledge of the floodway designation, the Iowa Department of Transportation constructed a bridge that was designed only to accommodate a 50-year flood event, according to court documents. The structure, which was begun in 1993, was completed in 1994.

Five years later, the region experienced heavy rains and floods, which damaged 35 homes and 34 businesses. It is estimated that the magnitude of the flooding was consistent with a 250-year flood, an a federal assessment concluded that the embankment constructed for the bypass “cut off a large portion of the floodway,” causing water to “back up.”  According to court documents, flood waters increased by as much as three feet in certain areas of the city, and waters entered certain portions of the city because of the obstruction caused by the bypass.

Following the flood and with the DNR’s blessing, in 2004, the state redesigned and reconstructed the bridge to allow for water flow compliant with a 100-year flood level.

Several property owners who suffered damage in the floods brought a suit alleging the state negligently designed and constructed the bridge, which obstructed the floodway and worsened the 1999 flood. The state argued for a dismissal of the case based on certain immunity defenses, and was originally granted summary judgment by the district and appeals court.

On review, however, the Iowa Supreme Court noted that, because the state was required by law to first win DNR approval prior to building in the floodway, discretionary immunity did not apply.

This statutory prohibition of floodway encroachments advances the General Assembly’s policy determination that “the protection of life and property from floods … is of paramount importance to the welfare and prosperity of the people of the state.” … In furtherance of this broad statement of policy, certain activities are expressly prohibited in a floodway or flood plain. A civil penalty of $500 per day may be imposed against those who erect, use, or maintain structures adversely affecting the efficiency, or unduly restricting the capacity, of a floodway without the permission of the DNR.

The property owners also claimed that construction of the bridge brought about a “permanent devaluation” of their land. While Supreme Court ruled that the redesign of the bridge satisfied design standards and tossed aside most of the argument, it left open arguments from two specific plaintiffs that “sold properties and suffered the economic loss occasioned by the flood-related dimunition in value prior to the reconstruction.”

Iowa Supreme Court, 07-0887