Part I in a series.
The meeting room for the Rankin-Hinds Pearl Flood and Drainage Control District Levee Board in Flowood filled with rancor Monday, Feb. 8, after the board learned that the state Legislature may vote to dilute its authority to make flood-control decisions for the metro area, clearing the way for the controversial Two Lakes development plan to come back to life.
The majority--the mayors of Jackson, Pearl, Flowood and Richland, along with Chairman Billy Orr--voted to send a letter of protest to the Legislature, as Two Lakes proponent Leland Speed protested and businessman Socrates Garrett sat quietly. Garrett is also on record for Two Lakes, although it was unclear what he thought about the board being re-engineered for a tailor-made vote in favor of Two Lakes. He abstained.
The Jackson mayor wasn't so reticent. "This is an effort to anticipate involvement and to involve the state, when it should be at a local level right now," Mayor Harvey Johnson Jr. said of the bill sponsored by Rep. Mary Coleman, D-Jackson. "If the state is forthcoming with money, then I agree with you: There should be representation. But until that time, it's a local matter, and I don't think the governor or the lieutenant governor should have appointees on this board."
The attempted realignment may be the result of the Levee Board moving late last year to follow the U.S. Army Corps of Engineer's advice on flood control, thus ensuring $133 million in federal funds about to go away if the foot-dragging continued. Late in 2009, the Levee Board voted to support the Corps' choice of a more basic, and expedient, levees-only plan instead of a lake-development plan.
The Corps received a Jan. 5, 2010, letter from the board expressing its support for pursuing a comprehensive levee plan "contingent upon various conditions being met." According to mayors, those include a recreation component and a future impoundment if needed. For instance, Johnson really wants a river walk downtown, and the Flowood mayor wouldn't mind one in Flowood as well.
Johnson said at a January editorial meeting with the JFP that he and others on the Levee Board want to work with the Corps to update the levee plan because the cost of the alternative is prohibitive. The Corps estimates that environmental mitigation alone on the Two Lakes plan would cost upward of a billion dollars, even though Lakes supporters routinely downplay those costs.
"They've done a great job of focusing the debate away from the cost of these other options to the cost of levees," Johnson said. "Any option will be expensive, and I don't buy that the private sector can come up with $400 million or $600 million to pay for an option."
The board is now moving to iron out details on beginning the drawdown of federal money in preparation for a final report on levee construction, which the Corps estimated would cost about $1 million.
Johnson said he has met with the Corps and hopes that the levee plan on the books--developed in 1996 with no update due to political pressure on the Corps by then-Rep. Chip Pickering, a friend of Two Lakes--can be greened and made more attractive.
While the board is working to fund the next phase of the levee project, members are exploring possible upgrades to what essentially is a 10-year-old plan, which many levee and Two Lakes critics consider minimalistic at best, an environmental nightmare at worst.
Damn Rotten Ugly
Face it: Levees are damn ugly. The Levee Board is only now coming to full grips with the apparent unsightliness of the old levee plan because members spent the majority of the last decade coming to terms with the impossibility of McGowan's lake plan for flood control. McGowan for years sold to the levee board (with varying degrees of success and varying versions of the plan) the possibility of a lake or lakes to hold floodwater. Constant rain north of the city of Jackson in 1979 resulted in more than $200 million in damage as floodwater backed up over and around the incomplete levee system partially protecting the city of Jackson and Rankin County.
Without acknowledging that the plan could be updated, McGowan argues that the 1996 levee plan, "is one of the ugliest proposals the city of Jackson could face."
"The people of Jackson aren't going to pay for an ugly, bare pile of dirt cutting northward. They've got to have something for their money," McGowan said at a Levee Board meeting in September. That "something" is more than 100 miles of shoreline that Two Lakes proponents ambitiously predict would be worth $2,000 per square foot (making 1,000 feet of shorefront worth $2 million, and raising taxes accordingly for land owners).
McGowan has pledged some of his own property to the government, but his family and business associates and related LLCs own many acres of land in the Two Lakes footprint, much of which would become lakefront.
Since the Levee Board voted to kill his plan in December by pursuing levees, McGowan has focused a public-relations assault against those levees. Looking past the irony that the old plan might have been reworked long ago had it not been for the strength of McGowan's lobby, his criticism of the now-dated levees plan hits its target.
Levees, nothing more than a trapezoidal pile of dirt, sure would be uglier than a big, happy lake. The Corps plan currently contains no scenic additions.
Downtown Jackson Partners President Ben Allen argues that the levee plan has too many flaws to be acceptable to local voters, who will have to approve a referendum to carry the new taxes to help pay for it.
"A 100-yard swath on each side of all of the levees will be scorched earth forever to assist water flow in the flooded area. Adding this to the width of the levees will equate into a 300-yard-wide scorched earth area throughout the entire levee system," Allen wrote on the Downtown Jackson blog.
"[T]here will be no development within the confines of the proposed Pearl River levees, unless one wishes to invest with cash. No bank will loan money in an area prone to flooding," he added.
Insured by Taxpayers, So Far
Insurance agent Hank Aiken owns a business on Dunbarton Drive just south of Lakeland with its backside dipping into the chill waters of the Pearl swamp. He says his father purchased the flood-prone land in 1978. The incomplete levee system offering equally incomplete protection to the downtown section of Jackson in 1979 does not extend to Aiken's business.
The owners of R.W. Aiken Insurance Agency--at least for a very brief time--were OK with setting up shop slap-dab in the middle of a floodplain. Insurance was cheap, and a flood seemed a distant threat.
"When my dad bought this land, he knew he was adjacent to the Pearl River swamp, but he also knew he was above the 100-year flood plain. When he finished building this building in 1978, he bought federal flood insurance," Aiken said. "It hadn't flooded prior to 1979 because the land was created in 1978. They made an earthen dam and pumped silt into it for about a quarter of the year, back before it was against the law to do that, I guess."
But the 1979 flood proved the developer wrong, and easily conquered the Aiken foundation, filling the interior of his business suite with at least five feet of water.
Levees are no improvement, from Aiken's standpoint. The design of the 1996 Corps levee plan will leave his business in the veritable bottle-neck of an expanded levee system, making his business too prone to flooding to be usable. The plan sets aside about $17 million for the relocation of businesses build in the floodplain. Aiken would likely be one of them--and he's not happy with it.
"I don't want them to take my land by eminent domain and pay me 10 cents on the dollar," Aiken said.
"Yes, it goes against common sense to build in a floodplain, but my Dad thought he was no longer prone to flood because of the raised land. They had one of the highest traffic roads, you're close to the best part of town, and you can rest assured that nobody's going to build behind you, so you'll be looking at the wooded nature area back there for the rest of time. The area has its advantages."
McGowan said the businesses in Aiken's corridor would suffer no eminent-domain problems under his lake plan, however, even though unoccupied land will. "In fact, it helps them," McGowan said in December. "That flood-prone property of theirs will become beautiful lakefront property with virtually no chance of flooding. The value of their land will go up. You can't tell me that somebody getting that kind of benefit wouldn't be willing to pay a little extra to have it." McGowan's most recent Two Lakes blueprint shows that he has drawn his shoreline around existing businesses, creating islands along Lakeland to contain those built in the floodplain (and, in some cases, land owned by LLCs managed by his business associates).
Ward 1 Councilman Jeff Weill also has had his law office in the flood plain on Lelia Drive since he bought it in 1990 (across the street from the planned Two Lakes shoreline). Unlike Aiken's family and like many other business owners in the area, he bought the flood-prone property after the 1979 flood--a decision that can seem odd on its face.
He says it made sense. "They're talking about this being a multi-hundred year flood (zone), and since I bought this building about 11 years after the last one, I figured my great-great grandchildren would have to worry about it, but I don't," Weill said this week.
"It's a great location, a perfect building for a small law practice, and I'm insured against the possibility of flooding." Weill said the flood insurance has been "extremely inexpensive" due to federal subsidy. "If the building floods, then Uncle Sam will come and pay for that," he said.
'What Do They Care?'
Just as Mayor Johnson warns that Two Lakes supporters vastly downplay the cost of their plan and are over-confident that banks will buy into a plan with uncertain payoffs far in the future, Two Lakes supporters warn that the old levee plan does not include additional local charges with which the city of Jackson will have to contend.
The Corps estimates the cost of the levees to be about $206 million, but that figure does not include McGowan's estimated price of $90 million worth of backwater pumps to drain two Jackson creeks over the levee floodgates in the event of a heavy rain over Jackson.
The levee plan, as is, includes floodgates to prevent the rising river from flowing back into town creeks and engulfing creek banks and the homes and businesses on top of them.
The Corps is willing to settle for a levee plan without pumps because they point to a scientific unlikelihood of heavy local rains coinciding with a rush of southbound floodwaters. The 1979 tragedy, for example, happened with only modest local rain, with the brunt of the water emanating from northern storms, the Corps says.
U.S. Army Corps of Engineers Chief of Project Management Doug Kamien told the Levee Board last September that the Corps estimated the chances of the double-whammy to be low, but nevertheless adjusted the degree of flood protection offered by the levees to only 79 percent because of the possibility. As a result, McGowan expounds at length that the levee plan is only 79 percent effective.
Levee Board member Leland Speed, a businessman and former Mississippi Development Authority head, argues that pumps are absolutely necessary, however.
"They're leaving the folks of Jackson to the floodwater," Speed said in December. "They don't care what happens here in Jackson. The people over there running the Corps don't live here. They're only there for a few months before they move on and leave the problem with somebody else who also doesn't have a real stake in Jackson. They come and go, so what do they care for my city?"
Some fellow Levee Board members, however, are openly critical of Speed's role on the board, supposedly representing the State Fairgrounds rather than landowners in Eastover who could make a lot of money off new waterfront property. Flowood Mayor Gary Rhoads this week told Speed he should step down because his family owns a small-but-well-situated piece of property that Two Lakes maps indicates could be adjacent to water.
Speed was offended at the suggestion that he had a conflict of interest that should preclude him sitting on the Levee Board. "Look fella, you work your butt off as long as I have, and some jerk wants to come in here and start maligning me--I don't take that lightly. And I mean it," he told the Jackson Free Press, as well as Rhoads, at the meeting.
Neither Speed or other Two Lakes partisans, such as Allen, believe that the city can get away with not paying for the pumps, even if they aren't included in the levees construction. Allen argues on his blog that Jackson would have to cover a total share of about $162 million for the project.
"This local share would have to be raised with taxes in Hinds and Rankin counties. A voter referendum would be needed for an increase in property taxes (to fund the levees), a legislatively approved sales-tax increase vote, or some other citizen-approved tax increase, and 60 percent of the voters in both counties would be necessary for approval," Allen wrote.
"From Puckett to Pisgah, Edwards to Flora, Jackson to Pearl and on," (the tax increase would need) 60 percent approval. ... This will never happen."
Allen has made clear that he will oppose any attempt to move toward levees and has proposed several public-private options for paying for Two Lakes instead--a route Johnson finds unrealistic for such a large and risky investment.
"The biggest problem, I expect, would be finding enough people willing to invest in the stock," the mayor said wryly.
Levees v. the Environment
The concerns over the levees do not begin or end with lakes advocates. Environmental engineer Pleas McNeel, a long-time opponent to McGowan's lake plan for several reasons, emphasizes he has little love for the 1996 levee plan, either. "If you're an opponent of a levees plan, you couldn't pick a better proposal to be the only alternative to McGowan's Two Lakes. It's not a pretty picture. It's filled with flaws and not an easy sell. Frankly, we need to re-engage the Corps and try to figure out if we can get flood control back on track," McNeel said.
When McNeel says "flood control," he means options Two Lakes supporters have shot down out of hand, and through political means, for years, such as dry dams, buy-outs, impoundments, or a smart combination of some or all of those with levees.
McNeel, who wants to put the wetlands area bordering the Pearl River to better, and greener, use as a local tourist attraction, has long warned that the levees would damage some of the more vibrant sections of valuable wetland. "Looking at the levee plan, it's hard to believe that it's actually more environmentally benign than the lake plan," McNeel said.
Retired water engineer and Two Lakes opponent Tom Pullen noted that the current design in the levee plan cuts through a portion of the LeFleur's Bluff State Park, particularly some wetland areas backing up against Eubanks Creek. "The problem with the way the levees currently look is they'll mess up the wetlands behind the levee," Pullen said. Wetlands derived from the rhythmical flooding of the Pearl River every spring depend upon the drainage of the river to maintain the quality of the water.
Without the flow of the Pearl carrying away whatever obnoxious chemicals the local populace dumps into their rain gutters (cans of paint, motor oil and assorted jugs of who-knows-what, etc.) the water becomes low-grade and stagnant, similar in quality to some of the levee-impounded wetlands on the Rankin side of Old Brandon Road.
"There will still be a wetland area there, but it wouldn't function like a natural wetland anymore. What it would become is a tap for run-off from the surrounding developed areas. It would be polluted. Some of that is fairly viable," Pullen said. "Maybe with a little design change, they could make the levee a little longer and go further up the valley of Eubanks Creek."
Corps spokesman Kavanaugh Breazeale said the Corps would not be willing to address "hypothetical questions" concerning added costs to levee alteration at this point.
"If the sponsor makes a specific request, we will study that on a case-by-case basis," Breazeale said last week.
Other issues with the levee lie with its narrow bottleneck design. The 1996 map shows that the levees nearly hug the river in every section with the exception of the fairgrounds.
"When the Corps designed the levee, it factored everything around environmental mitigation and costs," Kamien told the Jackson Free Press in September. "The levee plan is designed to achieve the greatest cost-benefit."
But Pullen said a design change that expanded the territory inside the levees could mean the levees would not have to be so high.
"If new levees are to be built upstream from Lakeland Drive, according to the plans I've seen, they wouldn't be located as far from the river as I'd like to see them," Pullen said. "I'd like to see the levees as far upland as possible, so the amount of land that's left in the floodplain in a natural state is naturalized. It could be done. The design currently has a straight-line levee, but the Corps can modify it to go around something like that. It depends on how many feet of levees it adds."
Crystal Lake Park, on the Rankin side of the river, would benefit from moving the levees back, keeping the water viable for fishing and tourism. The park would be subject to occasional flooding with the levees pushed back, but the water would hardly do damage to a park designed to experience floods. The nearby land is undeveloped and not subject to flood insurance requirements, so putting the park back in front of the levees, according to Pullen, would enliven it.
But the costs incurred in levee construction don't stop at height. Builders have to move considerably more than just an extra foot of dirt to add a foot to the top of a levee. The rule-of-thumb approach to raising the levee another foot is that designers must also add a foot of dirt at the bottom of the levee, because the structure has to be wide enough to accommodate a taller top. Lowering the height of levees would compensate for a portion of the cost of moving the levees back, but the savings would likely be minimal.
Breazeale said the next step in the levee process--a review jointly financed by the Levee Board and the Corps--would review the currently proposed alignment, as well as options for reducing costs. Breazeale would not say if cost reductions could include reduced levee height as a result of expanding any bottlenecks.
Pearl River Basin Development District Executive Director Mike Davis, who helped design the 1996 levee plan, said the old plan did contain bike paths and walking trails.
"Back in 1996, there were proposed recreational projects that would create places for people to go and exercise and beautification, for parking areas, trees and landscaping. That's a project we recommended to the Corps in 1996, but unfortunately it hasn't gone anywhere since that time because of all the focus on the lakes," Davis said. The current plan does not yet contain any recreational features.
Federal law already requires beneficiaries to bear part of the costs of installing and all of the costs for managing recreation developments at federal water resources projects. Construction costs for eligible recreational facilities on federal levee projects normally are cost shared 50/50 with the local sponsor, which also must provide all lands, easements, and rights-of-way and must pay for relocations, operation and maintenance.
It is the policy of federal construction agencies to restrict cost sharing to those types of recreational facilities that promote general public use and enjoyment of the project. (The construction of high-end business suites, apparently, don't count). Breazeale said any recreation features of the levees would be cost-shared 50-50 between the Corps and the local sponsor. "The current study does not yet contain a recreation feature," he said. "The rules for cost share have not changed since 1996."
Johnson expressed optimism that a new, friendlier attitude toward the Corps out of the Levee Board and the metro community can result in an upgrade of the 1996 plan that includes economic-development components.
Critics say the levees need a lot more than walking trails, however. Johnson told the JFP that he wants to "bring the river to the city," and advocates heavily for beautification that make the levees more of an asset to development, particularly in the downtown area.
The proposed levee at Lakeland Drive will be running alongside high-end real estate at Eastover and adjacent neighborhoods--areas that probably would not appreciate a bald grassy wall of dirt cutting across the lawn. Johnson suggests a levee design that includes scenic foliage and walking trails directly connected to paths and sidewalks behind the levee. But the Corps does not approve of much foliage growing on the levees. Even low-growing shrubbery gets mowed. Vegetation roots, while great for holding soil in place on a mountainside, can tear a levee to bits.
Some levees can accommodate limited vegetation, but only if the levee is of significant enough size to withstand the intrepid tendrils of plant roots. Expanding the size of the levee naturally comes with cost increases. Johnson has not yet revealed how additional beautification could be financed.
With all the issues, and no-matter-what opposition, piling up against the 1996 plan, the Levee Board undoubtedly will have a hard time selling the concept to the voting populace. Of course, the alternative could be, as Aiken puts it, "a little social Darwinism."
"If people can't buy flood insurance because the federal government says the National Flood Insurance Program has already paid you for three total losses so we're just not going to insure you anymore, then the home-owners and businesses will have no choice but to move out of the floodplain on their own," Aiken said, adding that there is no guarantee that either the residents or the business owners will relocate in Jackson.
For now, at least some of the businesses in the floodplain seem as far behind on getting information about flood-control options and dangers (beyond Two Lakes, anyway) as the rest of the populace. Over on Lelia Drive, Councilman Weill said he is not sure if he is in Ben Allen's feared "scorched-earth zone."
"Am I in it? I haven't seen the proposed levee locations. ... I don't suppose you could tell me where they are, can you?"
Additional reporting by Ward Schaefer.
Also see: Pearl-Related Bills This Session
Read more about this issue in this week's print edition and online. For the JFP's full coverage of Two Lakes and Levees, visit the The Pearl River Archive
Why is increasing the value of Jackson a bad thing? This editorial mentions several plots that would be worth more if we successfully pursue the lakes development option for flood control. Wouldn't increased property values, and increased tax revenue, be a good thing?
Wouldn't increased property values, and increased tax revenue, be a good thing?
As an ideological statement, increasing property values is a good thing; but it doesn't always play that way in the real world. As Madison residents will remind us, huge jumps in property value assessments -- that result in steep increases on your tax bill -- are not always a good thing, particularly if those assessments result in higher taxes but don't translate into real-world increases in the prices people are able to get for their homes.
So, the first problem is that you crank up taxes on current landowners, homeowners and businesses, pushing them out because the assessed value goes up so much that they can't afford the property taxes. (Such folks are, in fact, the most vocal critics of Two Lakes from within the floodplain.)
Second, the recent proposal I've seen for funding the Lakes project would create an quasi-governmental Authority that would gather the land -- often by eminent domain -- in order to clear the acreage needed to make the Lakes feasible.
This Authority would then own some of the high-value land (the parts not flooded) and would, presumably, re-sell it to developers once the lakes are created and the waterfront property reaches its high-dollar value. (This is in contrast to the Reservoir, for instance, where land is offered on long-term leases.) How that land is *priced* once it's collected, flooded and resold to developers, could mean that, at the end of the day, people's existing land was acquired at eminent domain prices, and, later, others profit from the property's increased value.
Third, the Authority proposal creates what looks to be one of the largest TIF districts (Tax Increment Financing) in the U.S., whereby hundreds of millions in funding would be borrowed against the future property tax receipts -- that are, of course, expected to rise precipitously because of the increase in land value.
TIF districts are often created as "infrastructure credit cards" for development projects (such as Renaissance and Colony Park in Ridgeland) where a private developer pays for the roads, lights, bridges and whatnot that get people to his or her new mall or "township" built in a field. You then tax people who benefit from that infrastructure, recognizing that the taxes collected first have to go to pay the bonds borrowed by the district to pay back the developers. (Note that because of that obligation, fewer of those dollars -- were the investments purely private -- go to schools and existing infrastructure.)
So what isn't clear about the "public-private" approach to building the Lakes is:
(a.) Who covers the TIF obligations if the Lakes don't work and we dig a $250 million hole?
(b.) If the Lakes DO get completed, then do property tax assessments go up regardless of the real value added to that property because of the TIF bond obligations? and
(c.) What sort of bonds will we need to float AFTER construction of the Lakes in order to build out the infrastructure that actually makes that land worth something to developers? (Which is the point where, IMO, a TIF might actually make sense.)
As we've seen recently in Madison on a small scale, when expected tax revenues don't match the $$ required to pay back the bonds, the government entity ends up reaching into other budget areas to pay for it.
So, in the case of Two Lakes, when you're looking at an initial $200-500 million in bonds that have to be repaid, if those property tax increases aren't realized, the money will need to come from somewhere else...like the taxpayers of surrounding cities and counties.
- Todd Stauffer
On the TIF/financing front, I just saw this in the Greater Jackson business interview with John McGowan. Verbatim; read closely:
GJB: How does the Two Lakes Foundation propose that the T wo Lakes plan be financed?
McGowan: "The Two Lakes project is estimated to cost $336 million. The economic development generated by the project will pay for a position of it. In 2007, Congress authorized $133 million to construct either levees or Two Lakes. The remaining construction costs can be secured through the issuance of bonds, to be repaid by a combination of ad valorem taxes generated by increased land value on the islands and lake periphery, leasehold rental income from waterfront property, developer fees and assessments. The Corps levees plan will require significant tax increases on the local property owners and state taxpayers, with no economic return."
Of course, one of the many things this article doesn't say is that it is Mr. McGowan who estimates that pricetag for Two Lakes; the official pricetag is more than a billion dollars by the time all the environmental mitigation comes into play. That's a lot of property taxes and bonds. Todd says it would be one of the biggest TIFs in history, and the other big ones have had costly (to taxpayer) problems with them. See his comment above. Read what I just posted in conjunction with what Todd posed above about the problem with TIFs. There is no wonder they're not putting this stuff in plain language.
Speed, McGowan, Allen, et al c 2 lakes as a revelation. Its an idea from God 2 save the City of Jackson. Biggest TIF & economic development plan in the state's history. It is a public-private partnership 2 benefit everyone but it has a very strong ideological and private interest basis. The prophets of the 2 lakes have not persuaded the Corps of its engineering merit or the Lord Mayor of its political viability. The state, the city, and the general government r dead broke but these developers have money parked somewhere in the Caymans 2 pony up. We need old fashioned levees and the path of education and sobriety to uplift Jaxon.