The U.S. Court of Federal Claims (CFC) recently decided two cases related to flood events during Hurricane Harvey in Southeast Texas in 2017—one finding a taking by the United States Army Corps of Engineers (USACE) for flood control management and allowing landowner recovery, with the other holding that no taking occurred during the same event. As the incidence of flooding events may become more prevalent and unpredictable in a changing climate, these two decisions provide guidance for dam operators, including hydroelectric project operators, that conduct flood management activities in cooperation with, and sometimes at the direction of, USACE or other governmental entities.
The CFC is a special court that only hears monetary cases against the federal government, including cases that involve a “taking” under the Fifth Amendment of the U.S. Constitution. A successful takings claim requires a valid property interest and a government infringement upon that valid property interest.
Following devastating flooding that occurred during Hurricane Harvey, a series of lawsuits were filed with the CFC by numerous property owners in Houston, Texas, against USACE. These lawsuits claimed that USACE’s management of two dams during Hurricane Harvey (Barker and Addicks, which were originally constructed for flood control) caused the unlawful inundation of the landowners’ properties without compensation. The dams are managed during emergency flood events by a USACE manual, which dictates that the dams are to remain closed until a certain water elevation is reached and then the water is released downstream. The result of the downpour from Harvey was that upstream properties were damaged by rising water behind the closed dams, and the downstream properties were damaged by flowage once the dams were eventually opened. The lawsuits were bifurcated into two separate litigations—the upstream property owners and the downstream property owners. In its rulings, the CFC held that while USACE’s actions in response to Hurricane Harvey caused a taking of properties upstream of Barker and Addicks, its downstream releases did not.
Upstream Landowners–Dam Management Activities Caused a Taking
On December 17, 2019, the CFC held that the upstream flooding constituted a Fifth Amendment taking since the flooding resulted from USACE’s dam design and decision to keep the flood gates closed in order to protect properties downstream at the expense of the upstream properties.
The Barker and Addicks dams were constructed in the 1940s, and, according to the factual findings of the CFC, USACE knew since at least the 1970s that the reservoirs could swell beyond federal lands acquired behind these dams for purposes of flood control. USACE had analyzed this issue over time, thus not only “believed flooding beyond the extent of government-owned land was probable, it is unreasonable to contend otherwise.” As a result, the CFC found that the flooding was an intentional outcome and caused by USACE, which constituted an unlawful taking under the Fifth Amendment of the U.S. Constitution.
Downstream Landowners—No Right to Perfect Flood Control and No Taking
On February 18, 2020, the CFC held that the flooding downstream of these same Barker and Addicks facilities did not constitute a taking because downstream property owners were not entitled to the right of “perfect” flood control during such an extreme weather event. The downstream plaintiffs did not allege that the design and decisional operation of the reservoirs caused the flooding of their property, but rather that the water passing through USACE’s dams belonged to the federal government (and was therefore not flood water) and that USACE had no right to store its water on the downstream property owners’ lands.
In rejecting these arguments, the CFC explained that a valid property interest is created by state law or federal common law, and that neither Texas state law nor federal common law recognizes a right to perfect flood control in the wake of an Act of God. The CFC stated that “the government’s construction of the Reservoirs and the resulting benefit of flood control does not, by its nature, affirmatively create a cognizable property interest in perfect flood control. . . There is a fundamental difference between property rights and the benefits a government provides to its citizens.”
The CFC then turned to an explanation of USACE’s immunity for flood control procedures. Section 702c of the Flood Control Act of 1928 (FCA) provides that “[n]o liability of any kind shall attach to or rest upon the United States for any damage from or by floods or flood waters at any place.” 33 U.S.C. § 702c (2018). The CFC explained that since the FCA’s enactment, courts have attempted to distinguish between what is and is not floodwater, quoting the Supreme Court’s precedent in Central Green Co. v. United States:
the text of the [FCA] directs us to determine the scope of the immunity conferred, not by the character of the federal project or the purpose it serves, but by the character of the waters that caused the relevant damage and the purpose behind their release. . . It is relatively easy to determine that a particular release of water that has reached flood stage is ‘flood water’ . . . or that a release directed by a power company for the commercial purpose of generating electricity is not . . . It is, however, not such a simple matter when damage may have been caused over a period of time in part by flood waters and in part by the routine use of the canal when it contained little more than a trickle.
531 U.S. 425, 434-436 (2001) (citations omitted).
With regard to the claims of downstream landowners, the CFC concluded that USACE was not storing government water on the downstream property owners’ property, but that the impounded and then released waters constituted flood water beyond what USACE could control.
These two cases highlight the highly fact-dependent nature of takings claims, and that even in identical events involving the same facilities, actions taken by the United States may or may not cause a taking under the Fifth Amendment.