CARTER LAKE – The area we know as Carter Lake was once called Cut-Off Island – a fitting name for a place torn between two cities and two states, yet connected to neither.
Iowa and Nebraska constantly battled for the city bordered by the new oxbow lake after the Missouri River changed its course in 1877. But to the stranded community on the west side of the river, neither Council Bluffs nor Omaha wanted Carter Lake for anything more than its tax revenue.
Residents of Carter Lake pleaded with leaders of both cities, yet neither extended utilities and services into what was a literal and figurative island in the middle of everything.
Finally, in 1930, Carter Lake was incorporated as a city in the state of Iowa, a status it has retained ever since.
The city has enjoyed a colorful, confusing history both before and after its incorporation. Carter Lake’s legal status has run the gamut from secession from Council Bluffs to the subject of at least two Supreme Court rulings. To nearby residents, the town served as everything from a family-friendly amusement park to one of the Midwest’s largest illegal gambling hotspots.
Now, Carter Lake Mayor Russ Kramer is trying to gather much more of his community’s story. Many of the original documents relating to the city’s early days were washed away in the Flood of 1952, and much of what is known about that time comes from people’s memories.
“The whole town was under three or four feet of water, and any paper records were shot,” said Kramer, a self-admitted “history nut” about his hometown since 1961. “ … Now when you’re reading history on websites, you could find five different stories on one topic.”
Carter Lake is often seen today as nothing more than a geographic outlier – one of many small pieces of land tossed back and forth between Iowa and Nebraska by the Missouri River’s fickle flow. But that status fails to do justice to what is known about the tug-of-war that resulted in its birth and shaped its history.
Murky waters along the Missouri
As it so often did in the 1800s, the Missouri River changed its course during an ice jam in 1877 that dug a new river channel near Saratoga Bend. When the waters shifted, a crescent-shaped body of water called Cut-Off Lake was all that remained of the river’s previous channel.
Alongside the lake, which still had the Missouri River lapping into it from the east, was a small slice of land owned by Council Bluffs resident Thomas Jefferis that had been on the Iowa side of the river before the flood.
Nebraska developers eager to build upon what they thought was Nebraska land in the late 1880s began constructing homes and neighborhoods for workers in the nearby factories in North Omaha and East Omaha.
“When the area was formed, they called it East Omaha Island,” Kramer said. “They thought it was theirs.”
One of the plants was the Carter White Lead Works – which later evolved into Dutch Boy Paint – owned by a man named Levi Carter.
The lake and the town itself assumed the name Carter Lake in 1909 after his widow donated much of their land along the shoreline to the city of Omaha. However, despite Carter’s influence, Kramer has yet to find a picture of Levi Carter, which is vital to his hopes of honoring one of the city’s early industrialists.
“The way his name is throughout this area,” Kramer said, “I’d love to have a bronze of him somewhere in town.”
Council Bluffs officials, however, saw Omaha’s intrusion as a brazen attempt to snatch land that rightfully belonged on their tax rolls. The ensuing legal battle over whether Iowa or Nebraska had jurisdiction over Cut-Off Island went to the Supreme Court.
In its 1892 ruling, the court sided with Iowa on the basis that state lines remain the same when a river avulsed, or dramatically altered, its path in 1877. Therefore, the land had never left Iowa, despite its position on the Nebraska side of the river.
However, The New York Times predicted issues would linger with the murkiness of the ruling, reporting that the decision was one “no one, not even the lawyers, has been able to understand.”
And, as the newspaper foresaw, that uncertainty was ripe for exploitation.
A get-away in the city
Throughout its existence, Carter Lake has been a recreational area – an escape capable of providing a good time under the shadows of the Omaha skyline.
Two entertainment interests capitalized on the 1877 flood in attempts to draw people to the Carter Lake shoreline: family amusement parks along the beach and illicit underground gambling operations attracted to the gray area of confusing legal jurisdictions.
On the northern tip of Carter Lake was Courtland Beach, a swimming hole turned into an amusement park. Former Pottawattamie County Historical Society President Ryan Roenfeld said the park was highlighted by one of the first roller coasters in the Midwest.
“It usually gets overshadowed by Lake Manawa,” he said, “but it was big for its day.”
Other attractions at Carter Lake’s most popular resort, which opened in 1895, included a merry-go-round and shows ranging from parachutists jumping from hot-air balloons to mind readers.
However, Courtland Beach and the other resorts would eventually fade, receding into history under pressure from new outdoor parks. Remnants of its wooden boardwalk are still occasionally found in the lake.
What took control of entertainment next in Carter Lake was a less socially acceptable manner of recreation.
“It was really a no-man’s land: Dogfighting, cockfighting, boxing matches,” Roenfeld said. “Some unsavory things went on there.”
What began with one man’s idea of building a floating bar in the lake to flout laws of both states eventually grew into a border town rife with vice: From alcohol, especially after Iowa repealed Prohibition before its western neighbor, to gambling of all sorts.
Not surprisingly, details of this shadowy underworld are, well, shadowy. Little more than rumors and memories tell this portion of Carter Lake’s story.
“All kinds of branches go off there,” Kramer said. “The research I’ve gotten is kind of sketchy. It was kind of a lawless area.”
Kramer said he’s heard of one enterprising gambling hall owner who built his establishment on the state line, represented by a stripe painted down the middle of the room, on the west side of Carter Lake.
When Nebraska officials came to raid the building for illegal gambling, spotters would inform the players, who then pushed all the tables to the Iowa side of the room. If Iowa officials made an appearance, the tables would all be on the Nebraska side before they arrived.
At the center of the Carter Lake’s notoriety was what Roenfeld called the “swanky” Chez Paree nightclub, which brought the glamour of gambling to Omaha’s doorstep. Rumors described it as one of the largest casinos between Illinois and Nevada.
Although the Chez Paree was closed down in a 1949 sting against illegal gambling, casinos returned to the area – this time, on the east side of the Missouri River – when Iowa legalized casino gambling 40 years later.
An island surrounded by everything
Growing between the hubbub on the shorelines and unclear state lines was a small but hardy community.
For many years, the lake that surrounded the city was still fed on one side by the Missouri River. Given its proximity to the river in those days and its low-lying topography, Carter Lake flooded on a regular basis.
Yet after each summer of high waters, the few hundred local residents waded back into their town to recapture and rebuild the island.
“They were really a plucky sort of people,” Roenfeld said.
However, despite being trapped between two cities, citizens of Carter Lake were on an isolated island. Council Bluffs, which exercised jurisdiction over the area, wouldn’t extend the necessary utilities into town during the 1920s.
Carter Lake residents became livid with how the city was exploited for its tax dollars, paying the same amount as a Council Bluffs resident without the comforts of running water and electricity. The city attorney noted that Carter Lake was “cut off for all purpose except that of collecting taxes.”
From that grew the rumblings of Carter Lake’s secession from Iowa.
“When you’re in Council Bluffs, you have lights, water and a sewer system,” Roenfeld said. “In Carter Lake, it’s 1920, and you have a dirt street that floods every year and an outhouse – but you pay the same taxes as someone in Council Bluffs.”
The island eventually seceded from Council Bluffs in 1927. Though secessionists in Carter Lake wanted to be absorbed by Omaha and into Nebraska, Omaha wouldn’t provide the services residents needed.
Divorced from one city and spurned by another, residents decided on another course of action: Founding their own city.
And in March 1930, by a margin of 171 to 124, voters approved Carter Lake’s incorporation as a municipality in the state of Iowa, giving birth to the geographical oddity of an Iowa city now accessible only by Nebraska roads.
Carter Lake’s ultimate statehood, however, would not be put to bed that easily.
“Carter Lake was like a badminton birdie or tennis ball,” Kramer said. “Omaha wanted us, and Council Bluffs wanted us.”
Starting in the 1940s, several Nebraska lawmakers began to champion ideas the reclamation of Carter Lake from Iowa as the city began to grow and prosper – over the objections of the young municipality.
Although Nebraska’s attempts never materialized into a true threat, the Iowa Legislature voted in 1961 to keep Carter Lake in Iowa – a place it never legally left, despite numerous attempts to bring it to Nebraska.
At home and at peace
Even in its relatively brief 82-year history as an incorporated municipality in Iowa, Carter Lake’s unique position on Nebraska’s side of the river has created its fair share of confusion.
Travelers heading from Omaha to Eppley Airfield on Abbott Drive – Iowa Highway 165, the state’s shortest at a half a mile in length – encounter “Welcome to Iowa!” signs between them and Nebraska’s largest airport.
Property owners on the northeast tip of Carter Lake – now a town of 3,785 – pay taxes to two states, as the state line cuts through a handful of backyards that back up to the lake.
But unlike so often in the history Kramer hopes to gather and expand, Carter Lake seems quite content with its current location.
No longer is Carter Lake cut off and isolated between the metropolitan area’s principal cities of Omaha and Council Bluffs. Rather, the community enjoys the small, horseshoe-shaped niche it forged out of the uncertainty between its roots in Iowa and constant geographical pull toward Nebraska.