A flowage easement is an agreement between a landowner and one of the member entities of the MFDA (either the Cass County Joint Water Resource District in North Dakota or the Moorhead-Clay County Joint Powers Authority in Minnesota) that allows the MFDA to store floodwater on the property in exchange for a payment to the landowner. The area where water is retained during project operation is called the upstream mitigation area, or UMA.
The MFDA has contracted with Crown Appraisals Inc. to provide research regarding property values to develop the value of the necessary flowage easements.
Questions on flowage easements?
Prepared in 2018 by Crown Appraisals Inc., the Phase 1 Report focused on researching comparable sales data and building a regression model to analyze market value changes due to similar flood risk in other areas across the nation. Findings were presented to the MFDA Land Management Committee in December 2018. Phase 1B was prepared in 2020 and focused on including market data from recent years.
To understand flowage easement appraisals, it is helpful to look at the property rights before and after the project:
|Property Rights Before Project||Property Rights After Project|
|Farming the property||Farming the property|
|Leasing the property||Leasing the property|
|Installing drainage||Installing drainage|
Typically for farmland, the loss of development rights is calculated at 8 percent to 10 percent of land value, depending on the upstream mitigation zone. Meanwhile, the increased flood risk can range from 7 to 30 percent. The total reduction in value for agriculture land is 15 to 40 percent.
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Flowage easements will be customized to each specific property and will be recorded. Understand more about the agreements using the sample documents below.
One of the biggest considerations in flowage easements is how often and for how long floodwater will need to be stored on a certain property. The table below has water level data for 20-, 50-, 100- and 500-year flood events, both before and after the project based on each owner identification number (OIN).