Cost to settle landowner lawsuits could cost NCDOT more than $1 billion

Three years ago, the state Supreme Court ruled that a 30-year-old law that let the Department of Transportation reserve land for future roads without actually buying it amounted to an unconstitutional taking of private property. The ruling on the Map Act opened the way for hundreds of landowners to seek compensation for property the NCDOT had locked up for years.

Now the bills are starting to come due. As of Friday, the state has reached settlements in about 360 Map Act cases, totaling $290 million. With another 260 cases still pending and others yet to be filed, NCDOT’s chief operating officer, Bobby Lewis, told the Board of Transportation last month that the cost of settling Map Act cases could exceed $1 billion.

“I said a billion just to give gravity to the situation,” Lewis said in an interview. “We don’t know until we know how many are going to be filed.”

Much of that money is going to buy land that the state needs to build more than a dozen roads across the state, including the Triangle Expressway across southern Wake County and loop roads around Greensboro and Winston-Salem. But legal fees and additional compensation for the lost use of the property over the years has inflated what the state is paying for the land by 62 percent on average, Lewis said.

Lewis said the department, which has a $5 billion annual budget, will have to absorb that added cost. He said it’s not clear yet whether it will result in delays in these or other road projects.

“It’s certainly going to have an impact on our program,” he said. “It’s just hard to say what that’s going to be.”

The cost of the Map Act settlements doesn’t surprise Matthew Bryant, whose law firm in Winston-Salem represents about 90 percent of the landowners who have sued the state over the law.

“We always understood that there was a significant financial downside for the state and a corresponding upside for the owners who had basically donated their property to the state for years,” Bryant said.

He added that now that the NCDOT has shifted from defending the Map Act to settling with landowners, the department has been “cooperative and fair.”

“They have a very difficult job,” he said. “And they need to be commended for how they’re responded, once they decided to get at it.”

Weather costs, too

The added costs for the Map Act come as the NCDOT has also spent hundreds of millions of dollars cleaning up and repairing roads after storms.

In more than a decade leading up to 2016, NCDOT averaged about $65 million a year in weather-related expenses, due to hurricanes, flash floods, rock slides and snow and ice, Lewis said. In the last three years, that number has ballooned to $225 million a year, he said.

Two major hurricanes — Matthew in 2016 and Florence last year — caused much of the damage. But Lewis said there’s also been an uptick in other kinds of storms, such as the flash flooding in early June that washed out roads across the state, including U.S. 401 in southern Franklin County.

“That itself is just shy of $1 million,” he said of the repairs to U.S. 401, which were completed Friday. “And we still have 20 roads closed across the state because of that June weather event.”

Gov. Roy Cooper has pointed to climate change as a factor in the severe weather the state has experienced in recent years, indicating that NCDOT will face more storm-related costs in the future.

“This weekend was part of our new normal when it comes to weather,” Cooper said in June, after thunderstorms dumped up to a foot of rain in parts of the state. “Sudden and severe weather can strike at any time, and we have seen already significant flooding events that should occur every 500 years or 1,000 years are occurring frequently.”

Map Act repealed

The NCDOT was already looking to delay dozens of big-ticket construction projects in the Triangle, including the widening of Wade Avenue near PNC Arena and the conversion of U.S. 1 into a freeway between Interstate 540 and Wake Forest. The department says several factors forced those delays, including overly optimistic cost estimates that haven’t panned out.

Higher-than-expected storm cleanup costs and the Map Act settlements could exacerbate those delays.

The General Assembly voted unanimously this year to formally strike the Map Act from state law. Constitutional issues aside, NCDOT officials say changes in the way the state plans future highways mean the department doesn’t need a law that lets it set aside land for highways that may not be built for decades.

Lewis declined to say whether he wished the state had abandoned the Map Act years ago and avoided having to settle so many landowner lawsuits in such a short period of time.

“I just follow whatever the law and court decisions say and make sure I can manage the department like a business and continue to make those adjustments,” he said.

For his part, Bryant, the attorney representing landowners harmed by the Map Act, said that as long as legislators kept the law in place, the court battle had to play itself out. He doesn’t blame NCDOT for defending the law all the way to the Supreme Court.

“I think they had to do that. I don’t think they had any choice,” he said. “The legislature passed the law, and the legislature tasked them with defending it.”

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Richard Stradling covers transportation for The News & Observer. Planes, trains and automobiles, plus ferries, bicycles, scooters and just plain walking. Also, #census2020. He’s been a reporter or editor for 32 years, including the last 20 at The N&O. 919-829-4739, rstradling@newsobserver.com.