3 BR, 2 Baths, With a Spectacular View of the Northwest Ordinance

Posted on July 21, 2014 by Linda Benfield

In Wisconsin, the desire to develop prime Milwaukee lakefront property is running head on into the Public Trust Doctrine and fueling interest in the state’s earliest history.  The lands that are now Wisconsin, Ohio, Indiana, Michigan and Illinois were initially included in the Northwest Ordinance of 1787 which established that navigable waters are “common highways” and are “forever free” to all citizens of the United States.  This language was incorporated into the state Constitution in 1848, and the Public Trust Doctrine is an integral part of Wisconsin’s environmental identity. The doctrine has been interpreted over the years to ensure that beaches have public access, that the public can swim, boat or walk in any water body as long as they “keep their feet wet,” and that restaurants located along Lake Michigan offer at least one cheap meal.   

Now a developer wants to replace an ill-suited County bus garage along the lake front with a high rise development that would include a hotel and high end apartments with lovely lake views.  The problem:  under the Public Trust Doctrine, title to the Lake Michigan lake bed (as it existed in 1848) off the shores of Milwaukee rests with the state, which is required to “preserve” and “promote” the public trust. A scramble to the history books and maps ensued, and an initial memorandum from the Wisconsin Department of Natural Resources “determining” that the land in question was not part of the lake bed in 1848 was rescinded when historical maps were found showing that approximately 2/3 of the property was in the lake bed at that time.  Proponents next argued that the property in question had accreted naturally, thus exempting it under a narrow exception to the Public Trust doctrine.  When historical documents showed that any structures that would have led to accretion were placed after the property was filled (and soil borings identified fill material), these parties turned to a 1913 deal with the Chicago Northwestern Railway.  The arguments that the city conveyed this property to the railroad, and that it would have become upland by the process of accretion, and in any event was for a public purpose and did not materially affect the rights of the public, did not gain independent traction, over similar public trust concerns.  

Enter the legislature. A budget bill was initially passed, whereby the legislature, as “Trustee,” approved the 1913 transaction. However, because Wisconsin law does not allow the legislature to include private bills in budget bills, a second bill was introduced and Act 140 was signed into law on March 17, 2014.  Act 140 sets the boundary of the lake bed at the line of the 1913 transaction, bars the Wisconsin Department of Natural Resources from taking a position on the determination, and declares that the legislature’s findings are “in lieu of, and have the same effect as,” a quiet title action entered by a court. 

The new law could have a profound impact on Milwaukee’s lake front.  This month, another company offered to purchase the county parking garage in the same area; this land was also part of the lake bed in 1848 and was included in the 1913 transaction.  The private company will pay off existing debt and commit to immediate, much-needed repairs to the parking garage.  It remains to be seen whether Act 140 will survive a judicial challenge, and whether judicial confirmation of the statute will be necessary to entice any necessary funding and title insurance for the developments.



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