Neighbors upset over Cargill dirt mounds in the Flats

CEDAR RAPIDS — Landowners who remain in an old, nearly abandoned neighborhood known as the Flats say their biggest neighbor, Cargill, is getting preferential treatment from the city as the global agroprocessing titan and large employer has bought and converted much of the land into storage for dirt and other flood protection material.

Cargill, which operates a sprawling industrial campus nearby, now owns the majority of land in the Flats and struck a deal with the city for a no-cost, 20-year lease with an option to buy most of the rest.

Since the September 2016 flood, Cargill has dumped mounds of gravel and dirt on the lots here, which still are zoned for residential. One pile is level with the roofline of an adjacent house, which had been rented until earlier this year. Another pile dwarfs a nearby garage. Cargill's earthen levee crosses two public streets — Hull Avenue and 17th Avenue SE.

'Just look at it. It's a mess,' said Curtis Belden, 49, whose garage on Hull is one of just four structures in the Flats not yet bulldozed. 'It's a giant sandpit.'

The neighborhood has a long history in Cedar Rapids dating to before the Civil War. Housing grew to 150 or so units by the 1980s, populated by workers from nearby factories or plants. In the decades since, and largely due to the 2008 flood washing over the low-lying area near the Cedar River, the Flats has been all but wiped off the map.

Aside from the dirt piles and levees, patches of grass intersperse with bare ground. Muck lines crumbling streets and sidewalks. An abandoned house with broken windows stands near 10th Street SE. Cargill acquired that property in June 2016 for $125,000.

City officials have given Cargill the OK.

'It's a result of the flood event and the flood event of 2008, too,' said Cedar Rapids City Engineer Nate Kampman. 'There's the fact not as many residents are there, if any are there anymore. Generally, we wouldn't allow a bunch of sand piles in the middle of a residential area, but this is not a normal situation.'

The roads see little activity beyond Cargill traffic and motorists still can gain access through other roads, Kampman said. The situation is not long-term, Kampman said, adding that the city is accommodating a business that spent heavily to protect itself from the flood and employs many.

The Gazette has reported Cargill has 250 direct employees and another 80 on contract in Cedar Rapids. The Minnetonka, Minn.-based Cargill reports its annual revenue exceeds $100 billion and it has 153,000 employees worldwide. According to Forbes, it is the largest privately-held company in America.

The city and Cargill verbally agreed to allow the material to remain at least until spring when the flood risk is higher, Kampman said.

Kelly Sheehan, Cargill's external communications lead for starches and sweeteners North America, declined to speak directly but responded to a few questions by email. She said Cargill plans to leave the material there until the Sinclair levee is in place.

Completion of that flood levee at the site of the former Sinclair meatpacking plant is slated for fall 2017. It is designed to protect the area from a flood with a river elevation of 20 feet.

'Cargill has been working collaboratively with the City of Cedar Rapids on its plans to temporarily store the flood material and keep the earthen berm along 10th Street until the City's Sinclair berm project is complete,' Sheehan said in the email.

Belden is crying foul because he spent years dealing with city warnings about his property, such as lawn upkeep and the condition of his house, which he demolished, and his garage, which still stands. He maintains a small garden there during the season.

'It's against the law what they are doing,' Belden said.

Alice Glick, 50, whose mother owns three of the remaining six lots not controlled by Cargill, sees it as the city tilting the scale in favor of company efforts to take over the Flats.

'Cargill just thinks they own it all,' Glick said. 'You can't build because the city took the gas lines out. Basically our property is useless, so they think you will sell it for nothing. I can't do anything with it, but they can come do whatever they want.'

In the 1990s, Cargill acquired several parcels immediately surrounding the plant, swallowed up a few public streets and turned much of that land into parking lots. At the time, neighbors pushed back, contending Cargill was trying to take over the neighborhood.

Dale Todd was on the Cedar Rapids City Council at the time of the acquisitions in the late 1990s and early 2000s and today is president of the Southside Investment Board, of which Cargill is a member. He remembers the discussions as contentious.

'The neighborhood mobilized,' Todd said. 'We were caught somewhat off guard, but out of the discussions a compromise that future industrial expansion would only go so far was reached. The problem today is that it was never a formal agreement. No one around today remembers it, and the flood washed away the line that was drawn.'

The buyouts had primarily been contained east of 16th Avenue SE, but the flood of 2008 changed the game. Afterward, some property owners sold to the city through a voluntary acquisition program sponsored by the Federal Emergency Management Agency, but more sold to Cargill. A few rebuilt, but Cargill eventually bought those, too.

Cargill went on a buying spree after the 2008 flood in an area generally framed by Ninth Street SE to the Cargill plant and from Hull Avenue to 16th Avenue SE.

Since 2009, Cargill has purchased 34 properties for more than $2.2 million. Some owners sold for as little as $10,000. Others struck a deal for as much as $235,800.

Earlier this month, the last occupying resident in the area, on 16th Avenue SE, sold his property where he and his young family lived, and a vacant rental property across the street for $225,000.

'Nobody lives here any more,' said Maitham Herz, 40. He doesn't begrudge Cargill, and thinks he got a fair price. 'I'm leaving my way, so I can't complain.'

In 2014, the City Council approved a deal with Cargill for 10 properties in the Flats, which the city acquired post-flood. The terms were for a 20-year lease at $1 per year. Since the land was city-owned, it was not taxed.

Per the agreement, Cargill was expected to maintain the area as 'green space,' although the city allowed Cargill flexibility, which the company is exercising.

As part of the deal, Cargill has the exclusive right to buy the 10 properties, and can refuse any lots if they have environmental concerns. The property is deed restricted because it is in a flood plain, meaning Cargill can't build on the land until a full flood protection system is in place, possibly in the early 2030s.

In requesting the land deal, Cargill briefly described its intent for the Flats, which is to purchase all 10 lots en mass and develop them within the 20-year lease window. The land could be used for any number of things such as office buildings, operations, parking, third party vendors or support. The City Council would need to approve rezoning and a site master plan before any construction occurs, said Jennifer Pratt, community development director for Cedar Rapids.

Pratt said the city benefits because it doesn't have to pay for upkeep such as mowing or snow removal on the land.

The Southside Investment Board has helped rebuild the nearby New Bohemia District with condos and apartments, retail, bars and restaurants, night life and walking and biking trails. As NewBo continues to expand, it will come even closer to the Flats. Meanwhile, Cargill is landlocked by the river and railroad tracks, so its path for expansion is west into the Flats.

Future growth needs to be done in a way that protects and preserves the integrity of stakeholders, Todd said.

'We would love to see an office building instead of a sea of parking lots,' Todd said. 'Whatever happens in the Flats, there needs to be a buffer there.'

Cargill's Sheehan said the company doesn't yet have plans for the land.

'In regards to Cargill purchasing several properties in that area, Cargill has no immediate plans for the properties it has purchased,' she said.

l Comments: (319) 339-3177; brian.morelli@thegazette.com