Rare oak savannas, century farms and a property on the National Register of Historic Places would be destroyed in a controversial lake project near the little Madison County town of Peru. Under the plan, taxpayers would be asked to shell out tens of millions to build a lake that would flood people's homes, while creating a personal lakefront retreat for Doug Gross.

By Brenda Fullick

After Mike and Kristi Schirm bought a particularly rugged piece of timber west of Peru in the 1980s, Mike soon noticed the strangest thing: There wasn't a single thistle on the place.

Thistles are common throughout rural Iowa, everywhere that immigrants tromped with heavy boots and wrestled the wilderness to the ground, making way for fencerow-to-fencerow farming. Mike Schirm - a lifelong outdoorsman who's been bow hunting since the age of 9 - had never seen a thistle-free piece of land in his life.

When Mike Schirm told neighbor and native-plant enthusiast Roslea Johnson about it, she was intrigued. She checked out the property and soon realized that the Schirms had an unusually large piece of native oak savanna, an unspoiled natural spot (and with more cream gentian than she had ever seen growing before in one place).

Environmentalists believe that less than one-tenth of 1 percent of Iowa's native prairie remains. But savanna is even rarer, because it was uncommon to begin with. Under the dappled shade of oaks that survived prairie fires, completely unique plant communities once grew.

Savannas are rare throughout the world, Johnson explains, because in most places, humans either clear trees to farm, or they do nothing - allowing trees to grow too thick for the endangered little savanna plants to survive. And even if a savanna does get regular burning to thin the trees (from lightning strikes, or more recently, conservation practices), grazing livestock can wipe out the native plant species.

Although just 45 minutes from Des Moines' western suburbs, the remote Clanton Creek area has pockets of native plants because of its rugged terrain, which through the generations has proven both a blessing and a curse. When the area was first settled, farmers were unable to clear the rough hills for row crops; yet that wildness is now a coveted commodity in a culture where so little remains unpaved, and Peru land values are on the rise as developers begin to take notice.

Meanwhile, for the past 17 years or so, Johnson has been harvesting seeds from the Schirms' timber for savanna restoration projects at the Neal Smith National Wildlife Refuge and Chichaqua Bottoms greenbelt. Volunteers had to experiment with the best way to propagate these native plants because they were so rare, botanists simply had no experience with them.

It's Iowa's horticultural version of the California condor story. A few other native oak savannas remained scattered around Iowa, but there may be none as large as the Schirm property.

However, the Schirm land may soon be lost forever, flooded as part of a controversial lake project proposed for southern Madison County.

A consortium of government and business interests have been meeting for more than a year to talk about building a lake in Iowa's second-fastest growing county. Members of the Madison County Lake Commission talk about a lake that could provide drinking water as well as outdoor recreation, with private lakefront development to draw money into the area.

One of the key people involved in the process has been top Republican and former gubernatorial candidate Doug Gross - who, incidentally, owns 1,086 acres of land in the Peru area. With his wife, Gross holds four large parcels in that township through a limited liability corporation, Hickory Hill Hereford Farms.

In July, the National Resources Conservation Service produced a report listing nine potential lake sites that the Lake Commission was considering. This was the first time that most rural Peru residents had heard any discussions of a new lake.

But by September - just two months later - the Lake Commission had decided that their top choice for a lake location would be the Clanton Creek area west of Peru. The rare oak savanna and about 25 homes (many of them century farms) would be flooded for a 2,500-acre lake expected to cost the public at least $30 million.

Neighbors find it curious that when they look at the topographical map for the proposed Peru Lake, they see that three of the four parcels that Gross owns in Madison County would suddenly become valuable lakefront property, including the land where his upscale country home sits.

Gross bought two of those four pieces of land in the Clanton Creek area after the Lake Commission began holding talks - but before the public knew what was in the works. Neighbors also find it odd that Gross was buying land near the future lake site, but, curiously, sold off low-lying land that would later be flooded, at least on the map.

"That's insider trading, to my way of thinking," Johnson says.

However, Gross explains that he simply had no way of knowing which location the Lake Commission was going to choose.

"I wish I was that smart," Gross says, jokingly.

All this talk about a new lake in Madison County can be traced to Iowa's last run for governor. Gross, a long-time Republican power broker who had worked for Govs. Bob Ray and Terry Brandstad, lost the 2002 race to Democratic incumbent Tom Vilsack.

Gross (who was the Iowa finance chairman for the Bush-Cheney campaign) says he decided to take what was left of his war chest after the governor's race and form the "Committee of 82," so named for Iowa's 82 rural counties. Through his Committee of 82, Gross commissioned Iowa State University researchers to study the relationships between rural economic vitality and certain other factors, such as the wage levels, in the rural Midwest. (The study found, for instance, that higher local wages typically mean better economic health for a rural area.)

Gross says one unexpected finding from the study was the fact that outdoor recreation is related to economic growth in rural areas. "We stumbled across it," he says.

Gross says he also discovered through the study that areas with recreational lakes tend to provide more of an economic stimulus when at least part of the lakefront property is privately developed. He thinks Iowa could learn a lesson from that statistical correlation.

"We have a lot of lakes around the state, but in almost every case, those are almost totally public," Gross says. He says allowing for private lakefront development would help Iowa's rural counties grow.

Based on that Committee of 82 report, the Madison County Chamber and Development Group decided to host what it called "The Big Think," a brainstorming session for community leaders to talk about the county's future, says chamber Director Chris Nolte.

They decided to create a lake consortium, partly to provide Winterset with a new water source and partly to spur economic development and create new recreational opportunites, Nolte says.

Gross says he volunteered to draw up the legal paperwork to form that consortium pro bono, for the same reasons that he formed the Committee of 82.

"I believe in what I'm doing," Gross says. "I did this study because I really care about the rural parts of the state."

Madison County Lake Commission board members include Nolte, as well as long-time Democratic politician Cy McDonald from the Madison County Board of Supervisors; Jim Liechty, representing the Madison County Conservation Board; Keith Sparks of the Madison County Soil and Water Conservation District; Winterset Mayor Jim Olson; Scott Wesselman, Manager of the Winterset Utility Board; and Dan McIntosh of the Southern Iowa Rural Water Association.

Nolte says the consortium chose Clanton Creek as its favored lake site over the objections of the very lawyer who had helped get the whole ball rolling.

Gross "did not like that location, the Clanton Creek location," Nolte says. "It was his recommendation that we put it anyplace but there."

The Lake Commission followed objective criteria when choosing the site, Nolte says. "We spent a lot of hours looking at those maps and going out there and talking to people."

Gross also says he had nothing to do with the selection process.

"I would have preferred it go a different place, between you and me, but that's where they put it," Gross says.

Though he had taken an active interest in the project and typically sent a representative to the Lake Commission meetings when he couldn't attend, Gross officially bowed out after they voted for the Clanton Creek site in September.

"I don't want people thinking I'm on both sides of the transaction," Gross says.

According to Nolte, the consortium board narrowed its potential lake sites from nine possibilities to one favored location at the request of Dave Beck of the Natural Resource Conservation Service (who did not return Cityview's calls). "They can only look at one site," Nolte says. "They have X number of staff."

However, Marty Adkins, assistant state conservation director for water resources at NRCS, says it's far too early in the process to narrow the options to one site. If Madison County gets $100,000 for a technical NRCS lake study, the agency will consider multiple issues at several locations, Adkins says - adding that NRCS might advise against any lake at all.

The NRCS would look at the geology as well as natural and cultural resources that could be destroyed, such as the oak savanna, century farms, property on the National Register of Historic Places, and the Indian burial grounds, he says.

The NRCS will provide technically accurate information based on objective criteria, and Congress probably wouldn't approve federal funding for a Clanton Creek project if another location gets a better evaluation based on objective criteria, Adkins says.

"We're going to be following the rules," Adkins says. "We're going to be as open with people as we can possibly be and try to make sure the process is transparent."

Gross bought his first property in the Clanton Creek area in 1989. That's where he built his upscale cabin retreat. An NRCS map of the proposed Peru Lake shows his cabin as future lakefront real estate, though Gross says those lake borders on the map may not be quite right and his cabin could end up underwater.

Gross bought another 260 acres on the other side of Peru in the 1990s. "I'm in the cow-calf business," Gross says. He says he needs land to raise his purebred Angus and Hereford cattle, and his Berkshire hogs.

In April of 2004, two weeks after Madison County's "Big Think," Gross bought another 550 acres of land in the Clanton Creek area from farmer T.J. Hamilton for $495,000, which comes to $900 an acre.

"I frankly wasn't even looking to buy at the time, but I needed some row-crop land," Gross says.

Seven months later, in November of 2004, Gross sold off 222 acres of the former Hamilton land for $332,475, at $1,498 an acre.

Gross took that money and reinvested it in another 323 acres in the Clanton Creek area for $387,475, at $1,200 an acre. He bought the land from William Reames, as in Reames Noodles, who used to let his family, employees and friends hunt and play on the property.

Gross asks why, if he were part of some inside trading scheme, he would sell the Hamilton land right on Clanton Creek and use the proceeds to buy the Reames land that sits just off the creek.

But neighbors contend that Gross knew exactly which land would become lakefront property and which would end up in the drink.

"It's absolutely not true," Gross says."I didn't even want the lake to go there."
Lake Commission Chairman Liechty confirms that Gross was not a part of the site selection process. Liechty also guesses that parts of the Gross property might end up underwater, too.

Gross has had representatives attending the Lake Commission meetings, and Gross was involved in drawing up the consortium document, Liechty says. But "he's not involved in the planning process or the NRCS part of this process in any manner."

"People like to think there's some conspiracy going on. It's absolutely, totally untrue," Gross says. "That couldn't be further from the truth. ... I, in no way, thought they were going to put this thing in Clanton Creek."

When lake proponents talk about the project, the first thing they mention is the need for a new water source in Madison County.

Madison County is growing, and Winterset's existing Cedar Lake has been plagued by nitrate problems.

Liechty says he knows of 80 new rural subdivisions in Madison County built in the past four years, and the trend has been moving toward larger and larger subdivisions. Liechty says he personally was interested in Clanton Creek because the area is less intensively farmed, which means less agricultural run-off and fewer nitrates.

But Wesselmann, Winterset's utility manager and a member of the Lake Commission, says the city should have its nitrate problem solved long before a lake could be built in Peru 10 to 12 years from now.

Nitrates are a problem because they have been linked to Blue Baby Syndrome, an inability of infants fewer than 6 months old to draw oxygen from their blood.

"Wetlands work the best for taking nitrates out of water," Wesselmann says. Winterset has been trying to work with landowners in the Cedar Lake watershed to create natural filters, but it's a time-consuming process. The city is now researching the technology options for a nitrate removal system at the treatment plant. He says the solution should be available for roughly $1 million.

"We're going to solve our nitrate problems within the next several years," Wesselmann predicts. "We want to solve the problem soon."

In addition to the nitrate issue is the issue of water volume. Dirt has been washing into Cedar Lake, meaning that the lake has less space to hold water. Wesselmann says he isn't worried about running out of water, but that the city also is wise not to put all its eggs in one muddy basket.

Winterset could create additional water holding space by either dredging the lake or moving the dam so Cedar Lake could cover a larger area, Wesselmann says.

The fly in that ointment is the fact that either dredging or moving the dam could cost $8 million, roughly speaking. And although a lake in Clanton Creek is estimated to cost somewhere between $30 million and $40 million - and that's before the government spends money to move roads, water mains, power lines, fiber-optic cable and a gas pipeline - the federal government offers matching financial assistance for certain new lake projects where recreation is allowed.

"The federal government has no money available to rehabilitate an existing lake," Wesselmann says.

The city of Winterset is participating in the Lake Commission to maximize its water options, he says, just to be safe. "We're looking out for our consumers ... Everybody wants a backup system."

He says hooking on to the Warren Water system really isn't an option because their rural water main in the area is too small.

But representatives of the neighboring Warren Water District insist that they haven't been consulted.

"It would not be all that difficult to bring a pipeline from the treatment plant at Maffitt [Lake] to Winterset," states a letter signed by Warren Water Board members James Mumford, Clair Waugh and Doyle Mapes - all residents of Madison County. Des Moines and several other metro communities already draw water from Maffitt, where there is a treatment system to remove nitrates. "It seems unreasonable for Winterset to ignore at least investigating what opportunities joining those efforts might provide," they wrote.

Clanton Creek neighbor Rick Tuttle also received a Nov. 15 letter from Peggy Crabbs, system manager at the Warren Water District, which states, "...[W]e believe we are a viable option for the city of Winterset."

"Water's not the issue here. I'm convinced of that," says Tuttle, who has been active in the lake's opposition. "What do I think? Doug Gross, that's what I think."
Ironically, the proposed Peru Lake might not hold water. Literally. According to Wayne Shafer at the NRCS, area farmers often have trouble building ponds to hold water for their cattle.

"Geologically, we are a very old, weathered part of the state," Shafer says. Other parts of Iowa have gotten new topsoil when glaciers moved through, but the last five glacial advances have bypassed this area.

That means the topsoil has been exposed to the elements for millions of years, wearing away to expose permeable limestone, sand and soft layers of shale.
To make up for those soil conditions, the Clanton Creek area might well need some form of blanket, possibly clay or concrete, to keep a 2,500-acre lake from leaking.

Many people, like the Schirms, living in that area west of Peru are farmers and hunters, often living modestly and close to the land. It's a place where coyotes are likely to run through the fields; barn cats scatter when hawks pass overhead.

Like their neighbors, the Schirms know that the area's land prices are going up because other people are starting to want what they've got. Urban people like the idea of a nice country home in the woods, surrounded by trees and wild turkeys.

If they're hunters, people like that idea even more.

But the Schirms don't want to sell their timber, not at any price.
"We can't replace it because you can't find it anymore," Kristi Schirm says. "It's a really unique piece of land."

Mike Schirm's dream was to own land for bowhunting. He's living his dream now, sitting for hours up in his tree stands and marveling at the beauty of his own property. He taught his daughter to plant food plots of turnips and clover for the deer. He personally makes the arrows that he and his friends use when they hunt for the food on their tables.

Yet Schirm feels like his own government is preparing to rip his land out from his fingers. "How do you justify stealing people's land to sell it to developers?"
Madison County could get federal financing for half of the lake project if it comes up with the rest of the money from state or local sources.

One of the things the Lake Commission has talked about - one thing that's got residents so angry - is the idea of allowing developers to sell people's land in the Clanton Creek area to raise money toward the local match.

If private developers can come up with 10 to 20 percent of the financing by selling people's land in the area at a profit, that's money the local taxpayers wouldn't have to come up with, says chairman Liechty.

"That is a means to save taxpayer dollars," Liechty says. "Obviously, the area's going to be developed anyway."

Liechty says he's not exactly sure how this creative financing would work.
"We're looking at all different possibilities right now," Liechty says. "With or without the lake, the development is gradually going to occur."

The idea isn't to rob people of their land, Nolte insists. "One of the things that has been discussed is, we may look at the development of partnerships [between landowners and developers] to come up with a win-win."

Neighbors fear that their land will be taken through eminent domain.

"Eminent domain has not been a topic of conversation," Nolte says. "We want this to be a friendly thing, where everybody works together."

But most of the neighbors say they don't want to sell. The properties are people's homes, their livelihoods, the places where their grandparents hunted and farmed.

"It's not just dirt," Kristi Schirm says. "It's their heart. They're just ripping their hearts out of them."

Once upon a time, governments couldn't take people's land without at least claiming that it was for the highest public good.

But since the controversial Kelo v. New London ruling by the U.S. Supreme Court this year, everything has shifted. The high court set legal precedent by allowing a government to take people's land simply so someone else could make money from it.

In the past, developers who wanted to take private land so they could profit had to find a government to go along with them and come up with a public-use rationale, says Sam Staley, director of urban land-use and growth at the Los Angeles-based Reason Foundation. "Because of Kelo, it's no longer even a constraint."

Reason operates an Eminent Domain Resource Center, which is sympathetic to landowner concerns.

It may be that in the Clanton Creek case, the Lake Commission is talking about a public water source at least in the early stages of the project because they recognize that taking the land simply for economic development wouldn't be popular, Staley says.

Without the perceived need for an additional water supply, "it may be more difficult for them to get the approval because of the groundswell of opposition."

Ironically (or not), the Committee of 82 study that Gross produced could help local government take people's private property and hand it over to developers, since the land taken by eminent domain for private development must be taken within the context of a "well-considered planning process."

The way to determine whether a process is "well-considered," Staley says, is to find out whether a study has been done.

The Gross report "would be evidence that would be used to show that this was a well-considered plan," Staley says.

Nationwide, most of the attention in the eminent domain debate has shifted to the state legislatures, where several governments are considering laws to strengthen private property rights.

State Rep. Jodi Tymeson (R-Winterset) has heard from worried constituents in the Clanton Creek area, and she's worried, too. As far as she's concerned, it's unconstitutional to take one person's land and give it to somebody else.

She predicts the Iowa Legislature will consider a stronger law in this next session, and she predicts that it will have bipartisan support.

"The U.S. Constitution is clear that eminent domain is for public use," Tymeson says. "Even though I think the law is clear that eminent domain is only for public use, I certainly am going to support a law that makes it even more clear."

Legislators are working on bills to introduce in the next session, Tymeson says. "I do think there is a sense of urgency about this. Nobody's safe, I think."

Clanton Creek neighbors have been holding their own organizational meetings since mid-October. At one meeting, more than 60 residents showed up, and every single person was against the lake.

The neighbors estimate that at least 25 houses would be underwater, and possibly 26 or 27. Another 12 landowners and six renters also would be affected.

"Pretty much everyone's opposed," says Cindy Tuttle, one of the organizers. Many have properties where they raised their kids, or farms they inherited from Grandpa. They like living in the country, seeing wildlife out their picture windows.

"It's not about money," Cindy Tuttle says. "We do not want to sell."

Meanwhile, the neighbors watch as land prices rise like floodwaters around them. In May of this year, Reames sold 516 acres with a hunting lodge in the Clanton Creek area for $625,000 to WK2D Investments, a hunting group out of Missouri. In October, WK2D sold the same property for $830,000 - at a $205,000 profit in five months.

That investor, Kreuder Farms of Illinois, has just turned over the land a third time in a six-month period to a private family, who paid $1.15 million for those same 516 acres.

Personally, Peru native Dean Decker likes the idea of a lake over Clanton Creek, even though his family's century farm would be underwater. "I think it's the best thing that happened to Madison County," Decker says. He envisions himself in a boat floating above land he used to own. "They need water, and just think of the recreation. I like to fish. I'll get me a big pontoon boat and I'll be sitting down there."

But Decker also understands that he's in the minority.

Rick Tuttle says neighbors are realizing what they've got, how much their land is worth, and how hard it would be to replace. The Tuttles bought 30 acres of timber behind their house to guarantee they'd always be surrounded by nature. "It's so rare to find places like this anymore," he says. Timber ground has suddenly become more valuable that flat farm ground. "You couldn't hardly give it away 15 years ago."

Johnson is worried about the oak savannas and native prairie remnants, some of which could be flooded before anyone sees them and recognizes their value as part of Iowa's environmental heritage.

She's also worried about the old Schoenenberger stone house and European-style cattle barn that she owns with her husband, Bob. The house was built in roughly 1857 right on Clanton Creek, built into a hillside slope for winter protection, with south-facing windows overlooking the creek and within line of sight to the cliff where the limestone was quarried.

Johnson worked long hours as a volunteer cataloging the stone houses of Madison County and trying to win them protection through the National Register of Historic Places. Of all of the limestone buildings in Madison County, the Schoenenberger house may be the most historically significant.

But regardless of the historical significance, it could end up underwater.

According to the preliminary map, Johnson says, "all the houses [along Clanton Creek] except Doug Gross' would be flooded." CV

Comment on this story | Return to top