Editor’s note: Flatwater Explains is an occasional series during which FFP reporters explain the people, places and things that make Nebraska what it is, while answering questions that both longtime residents and first-time visitors might have.
It’s a quintessential Omaha experience: You’re driving to the airport, and all of a sudden, you’re in Iowa. A half-mile later, you’re back in Nebraska.
The well-traversed stretch of road is part of Carter Lake, a geographical oddity created by a course-altering flood along the Missouri River. Once a disputed territory, the Iowa exclave lies at the heart of a historic interstate rivalry pitting Huskers against Hawkeyes.
How did Carter Lake form?
During a cold snap in March 1877, enormous chunks of ice jammed the Missouri River at a sharp bend north of Omaha.
The major flood that ensued carved a new channel for the river, quickly creating a horseshoe-shaped lake along the old bend and severing a 1,200-acre piece of land from the rest of Iowa.
Locals called the new body of water Cut-Off Lake or Lake Nakoma until it was renamed in 1909 to honor Levi Carter, a prominent businessman who founded an Omaha lead plant that caused massive environmental contamination in the area. As Omaha grew, the lake became a hub for sailboating and other genteel water recreation.
The land, known today as the city of Carter Lake, sparked cross-border bickering almost immediately after the flood.
An 1877 article in the Omaha Bee claimed the tract for Nebraska since it now sat west of the Missouri River, historically the legal boundary between the states.
Iowans argued the river’s rerouting didn’t change anything: This land was theirs.
Why is it in Iowa?
Nebraska v. Iowa had two meanings in 1891: the first football game ever played between the states’ top college teams, and the name of a lawsuit contesting ownership of modern-day Carter Lake.
Iowa won on the gridiron, and months later, in the courtroom, too.
The U.S. Supreme Court ruled that since the Missouri River’s channel changed swiftly rather than gradually, the old border remained in place.
The decision solidified the area as a detached fragment of Council Bluffs, but residents voted to secede from the city because they were sick of paying local taxes without receiving public services like fire stations and public schools.
“God took us out of Council Bluffs when the good old Missouri cut us off,” said attorney W.C. Fraser, a namesake partner of the Fraser Stryker law firm, in 1926. “And speaking of cutoffs, that’s what we are. A cut-off territory — cut off for all purposes except paying taxes.”
In 1930, Carter Lake incorporated, becoming the only Iowa municipality west of the Missouri River.
Since then, the city has existed in a gray area between its two bigger neighbors.
Growing up in the 1960s, Keebie Kessler remembers Carter Lake having an Omaha ZIP code despite being part of Iowa. The phone company charged long-distance rates for calls to Council Bluffs, where locals attended high school.
”We’re still the forgotten city,” Kessler said. “We kind of get left out of a lot of things.”
Still, the former Carter Lake councilman said he’s glad the city belongs to Iowa and not Nebraska. Something deep within him identifies with the Hawkeye State, he said.
Why does it matter?
Carter Lake’s unique status as independent and in-between has made it a well-suited host for revelry — or debauchery — depending on who you ask.
In the mid-1900s, the city held a reputation as a hotbed of gambling, prostitution and bootlegging.
Kessler remembers hearing stories about illegal poker games at an infamous Locust Street nightclub called the Shangri-La.
“If the Iowa cops came, they’d move over to the Nebraska side, and if the Nebraska cops came they’d move over to the Iowa side,” Kessler said.
Today, Carter Lake’s gambling scene is above board, though not without controversy.
In 2018, the Ponca Tribe opened a casino in the city, spurring lawsuits from Nebraska, Iowa and Council Bluffs. At the time, Nebraska prohibited most casinos, and state attorneys argued having one physically attached to Omaha would afflict the city with “the negative effects of gambling.”
Carter Lake and the tribe prevailed in court, and the casino recently expanded to include more than 600 slot machines, electronic table games and a new sportsbook.
8 Comments
I love Nebraska history, even its about Omaha…
Well done!!
Correct me if I wrong, besides pieces of nefarious history…
Wasn’t Carter lake also home to Omaha’s famous board track speed drome? This would’ve been late teens early 20’s.
I found that looking at old Omaha maps on www.
The track supposed to have been one of the better tracks nationwide.
That’s correct! It was very short-lived but burned brightly. Here’s historian Adam Fletcher Sasse’s write-up about it: https://northomahahistory.com/2017/01/08/omaha-auto-speedway/
Shangri-la? The chez paree was run by Omaha businessmen like Maxie abramson as gambling, steak dinner, and swanky floor show made it the place when Las Vegas was a couple up employees and Mormons. It moved a few times and with the riviera and stork club on the south Omaha bridge road there was plenty of envelopes for the Pott. County sheriff’s dept. but then kc muscle tried to move in until Charlie binaggio got whacked, likely on orders from Meyer lansky. An interesting and wild era. Chickie berman? Sam ziegman? Let me know if ever want more and ask yourself where those dealers in late 40s Vegas learned those games. Ernst lied and Jackie gaughen weren’t the only ones who headed to that water stop on the up line to la where a former Omaha cop kept gambling legal and that skimmed money needed whitewashed
Hi Ryan, good to hear from an Iowa/Omaha historian of your stature. These are some fascinating insights on the Carter Lake gambling scene, and if I’m ever writing about this again, I’ll be sure to reach out. I came across the Chez Paree while digging around newspaper archives — that certainly seemed like the premier club in the area while it was open.
I mentioned the Shangri-La because that’s what my source Keebie Kessler remembered hearing stories about growing up in the 1960s. It was run by the perpetually embattled Leo Kubik, raided by police in 1963 and shut down later in the decade. Definitely didn’t have the run or the influence of the Chez Paree, but I had to leave a lot out of this story to meet my word count. Thanks for reading!
Oh, and see the attempt by the east Omaha land company to duplicate the success of south Omaha as to why Iowa wanted the taxes
Why isn’t some of the land around Lake Manawa part of Nebraska? It seems like it would have been the same situation.
It was. The south shore was considered part of Nebraska with the same sort of dubious legal status into the early 20th century. It was less an issue of the cops showing up to bust anyone because they were paid off not to do that and more where would a skimmed mark file their lawsuit over getting flim flammed? The swamps south of manawa might be Iowa or Nebraska and might be in Douglas or sarpy or mills or pottawattamie counties.
Assuming those maps are to scale, they sure destroyed a lot of the river over the years 🙁 Then again, it was probably just ‘us’ diverting the water elsewhere leaving us with more mud/empty banks to develop on, like what happened with the original loop.