Tuesday, August 9, 2022

Unable to reach agreement with homeowners, Wilmington eyes eminent domain for stormwater improvements

Wilmington City Council will consider the eminent domain vote on Tuesday this week. (Port City Daily photo / File)

WILMINGTON — City Council will vote on whether or not to use eminent domain to take easements on five private properties for its $11-million project to improve drainage of Clear Run Branch in midtown.

The drainage improvements, part of the largest stormwater project ever untaken by the city, will help reduce severe flooding around New Centre Drive and the area north of UNCW.

While the city has reached voluntary easement agreements with the majority of properties in the path of the project, staff have been unable to agree on “the amount and/or the specific terms of the easement agreements to complete the negotiations” with five property owners.

While city staff members are still working on negotiations with these property owners, the city feels “it will be necessary to file condemnation claims in order for the City to timely obtain the property rights needed to complete this capital improvement project.”

The city has assessed the value of four of the five properties, and has an estimate on the fifth property, and expects the total cost of the condemnation will be around $300,000. However, it’s worth noting the city has underestimated the cost of eminent domain in the past.

Related: Wilmington pays $300,000 in River Place eminent domain settlement, over tenfold the estimated cost

City Council went into closed session during Monday’s agenda briefing meeting to discuss the issue, but no action will be taken until Tuesday night, when council will vote on whether or not to condemn the easements.

Stormwater issues

From the 2015 meeting between the city and property owners affected by the drainage project. BEHI: Bank Erosion Hazard Index. (Port City Daily photo / City of Wilmington)

Drainage on Clear Run Branch, a tributary of Bradley Creek, has been a problem for over a decade. A 2010 study found the Clear Run watershed was near or completely built out, with considerable upstream development and considerable impervious area (i.e. roofs, pavement, and other surfaces that don’t absorb water and thus generate runoff).

The resulting stormwater has been overwhelming the Clear Run drainage area and causing flooding on New Centre Drive and in the region to the north of UNCW’s campus, with the upstream part of Clear Run considered “unstable and eroding.”

The $11-million Clear Run Branch Drainage Improvement project “is the largest stormwater capital improvement project that the City of Wilmington has undertaken to reduce chronic flooding, improve water quality, and enhance natural habitat,” according to the city.

The project’s first phase involves installing large box culverts (pipes) to channel stormwater under College Acres Drive and Mallard Street. The phase also includes stream restoration and floodplain creation to increase the flood capacity of Clear Run Branch.

Expanding the floodplain, however, will require easements from around 50 properties, primarily from the backyards of properties along Clear Run Drive, on the north side of the floodplain.

Settlements, holdouts

Four of the five properties slated for condemnation if City Council approves the motion on Tuesday. (Port City Daily photo / City of Wilmington)

The city mailed notices of the planned project to property owners in 2013 and met with property owners in October 2015 to discuss the project, why it was important, and how it would impact surrounding properties.

According to the city, 22 easement agreements have already closed and four additional closings are scheduled. Another 24 property owners have tentatively agreed to settle, but those agreements have not had a closing scheduled yet.

After “extensive efforts” to resolve the issue, the city attorney’s office mailed two letters to the five holdouts, notifying them that the city was considering condemnation; the first letter was mailed on July 30, the second was mailed on August 26.

Eminent domain: Estimated vs. final costs

Under state and federal law, governments can use eminent domain to condemn or ‘take’ property for projects that benefit the general public, but only if they provide adequate compensation.

In North Carolina, when a government body like Wilmington condemns property — taking part or all of a parcel of land — the owner must be given 30 days’ notice. Then, the city files a condemnation action in Superior Court and pays the appraised value of the land into a fund held by the court.

At that point, the city has access to the land.

For voluntary easements, this process isn’t necessary, because the property owners have agreed to the city’s compensation offer in order to use their property. In the case of the five holdouts, the city will have to condemn the property because such an agreement couldn’t be reached. It’s likely, then, that at least some of the five property owners will contest the city’s assessment of the portion of their property that’s being taken.

It’s doubtful this would derail the stormwater project, but it could increase the price.

Property owners can contest eminent domain, but they must essentially prove that project doesn’t qualify as ‘public use.’ Victories in these cases are rare — but owners who successfully contest the evaluation of their land are more common.

When the city took land for its public-private River Place project, several property owners along North Front Street contested the city’s assessment of the value of their land. For various reasons, owners felt that the portions of their property being taken (temporarily or permanently) were more valuable. According to court records, the initial estimate for the contested Front Street eminent domain condemnations was $92,464 but the settlements eventually totaled $442,990.

Of course, every eminent domain case is different, and the River Place taking was particularly complex. But it’s fair to say, the initial deposit in a condemnation action is not a set-in-stone line item cost.

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